Rocket Mortgage posts $709 million Q3 profit as revenue nearly doubles
Rocket Companies, the Detroit-based mortgage lender, posted a $709 million Q3 profit.
The short version
- That reversed a year-ago loss as net revenue rose to $3.28 billion.
- Closed loan volume fell to $43.6 billion amid higher rates.
- Higher rates mean tighter mortgage markets for home buyers and refinancers.
Rocket Companies, the Detroit-based mortgage lender, reported a third-quarter net income of $709 million on Thursday, reversing a loss from a year ago. According to HousingWire, net total revenue nearly doubled year over year to $3.28 billion, up from $1.7 billion. The surge came even as closed origination volume fell to $43.6 billion, down from $49.1 billion in the second quarter.
Mortgage rates above 6.8% and rising inflation expectations created key challenges for the industry. "Rocket gained market share in both purchase and refinance, quarter over quarter and year over year, and delivered our highest profitability margin in nearly five years, even as mortgage rates climbed to a three-year high," CEO Varun Krishna said in a statement.
The company estimated its purchase market share approached 6.5% in Q3, up from 6.2% in Q2, while its refinance share reached 15.5%. Rocket's mortgage servicing portfolio remained steady at about $2 trillion in unpaid principal balance across 9.1 million loans. Total liquidity rose to $11.4 billion at the end of the quarter, including $2.7 billion in cash.
The Detroit lender also expanded its use of artificial intelligence, with AI voice technology handling 65% of inbound servicing calls. For your own mortgage shopping or refinancing plans, higher lender profits and tighter origination volumes show that banks are squeezing more margin out of every loan while rates stay elevated.
