Home Point Capital is the latest mortgage company to apply for an IPO, continuing the activities of non-banks seeking to capitalize on investors' interest in the sector.
After Rocket Cos. And United Wholesale Mortgage, which is expected to start trading on Jan. 22 following the completion of its merger with Gores Holdings IV, will become the third Michigan-based independent mortgage banker to go public in recent months.
Home Point Capital would like to list on the Nasdaq Global Select Market with the ticker symbol HMPT.
Goldman Sachs & Co., Wells Fargo Securities, Morgan Stanley and UBS Investment Bank are the lead bookrunning managers, while Credit Suisse, JPMorgan and BofA Securities also serve in this role. JMP Securities, Piper Sandler & Co., R. Seelaus & Co., SPC Capital Markets, Wedbush Securities and Zelman Partners are co-managers for the proposed offering.
The Ann Arbor, Michigan-based company renamed its operating unit Homepoint in December. It was founded in 2015 by President and CEO Willie Newman after leaving Cole Taylor Bank, where he headed that bank's mortgage division. Previously, he was Executive Vice President of the ABN Amro Mortgage Group.
Newman took steps to expand the company starting in 2017 when Homepoint acquired Stonegate Mortgage. In April 2019, the company acquired the wholesale operations of Platinum Mortgage.
In addition, Home Point Capital owns 49.7% of the reverse mortgage lender Longbridge Financial.
In the first nine months of 2020, Home Point Capital earned $ 442.6 million, compared to a loss of $ 45.3 million for the same period in 2019, the prospectus indicated.
For the nine months ended September 30, 2020, it was estimated at $ 38.05 billion, with a profit margin of 253.1 basis points. In the same period of 2019, it generated nearly $ 14 billion, with a profit margin of 96.8 basis points.
Of that total 2020 production, $ 23.8 billion was from wholesale, $ 12.7 billion from correspondence credit purchases, and $ 1.6 billion from a direct consumer channel focused on customer loyalty .
As of September 30th, Homepoint had seven warehouse lines with a total volume of $ 3.1 billion. With the exception of one evergreen line, these facilities currently expire between May and September.
Homepoint serviced approximately $ 74 billion as of the end of the third quarter, up from $ 52.6 billion on December 31, 2019. The fair value of its mortgage service rights decreased by $ 98.3 million in the first nine months of the year a reduction of $ 84.9 million for the same period in 2019.