Florida broker sues UWM over policy banning work with Rocket, Fairway

A Florida mortgage broker is suing United Wholesale Mortgage, claiming the wholesaler's policy regarding doing business with Rocket Cos. and Fairway Independent Mortgage is anticompetitive and a restraint of trade.

The suit seeks class action status and was filed in the U.S. District Court for the Middle District of Florida. The Okavage Group is the named plaintiff but reportedly other firms are involved as well.

"UWM is committed to and focused on the growth and success of over 10,000 independent mortgage brokers across America who chose to be 'All In' for the broker channel," a statement from a company spokesperson said. "We are not focused on the roughly 600 who declined to move forward as a partner. We do not comment on legal matters that are currently pending, especially those that have no merit or substance."

Okavage's suit alleges violations of the Sherman Antitrust Act, the Florida Antitrust Act, Tortious Interference with Business Relationships and Florida's Deceptive and Unfair Trade Practices Act.

This case is "the first strike," with more to come, including from mortgage brokers in California, said Okavage's attorney Robert Goodman of Parrish & Goodman in Fort Myers, Fla.

These mortgage brokers are upset that UWM is "limiting the ability to provide certain loans to their customers that might be better suited for their customers," Goodman said in an interview.

"There are times where Rocket's offering a better rate than UWM and that client, the end user, the borrower, the consumer is the one that is really injured; the broker is going to be injured as well," he added.

It detracts from the mortgage broker finding the best fit for the consumer and then doing more business with them down the road, Goodman continued.

"They're not just expecting to do this one and done, they expect to build a relationship with the customer," he said. "They may lose that customer that customer for life, just because of the inability to place a loan."

Interference with freedom of choice is why mortgage broker Okavage Group joined the lawsuit.

"I am fighting back against UWM because my freedom and independence, the reason my clients choose to work with me, has been stripped away," said Dan O'Kavage, president of the company, which is headquartered in St. Augustine, Fla. "If I didn't want to operate in an independent fashion, I would work on the retail side of the industry and work in-shop for one of the major lenders."