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UWM Sues Mortgage Solutions And Its Owner Over EPOs, Trademark Infringement

United Wholesale Mortgage (UWM) has accused California-based brokerage and correspondent lender Mortgage Solutions FCS, dba Client Direct Mortgage, of breaching its early payoff (EPO) provision and its owner, Ramon Walker, of trademark infringement.

UWM filed a lawsuit in a U.S. district court in Michigan on Wednesday.

The legal battle follows the creation of a Facebook group called “Rocket Pro TPO vs UWM,” which UWM says Walker founded on Oct. 28, 2023.

Per the lawsuit, the group “blatantly” displays UWM’s trademark, but Walker advertises the goods and services of his company and apparent partner, Rocket Pro TPO.

“Moreover, while the Facebook group is entitled ‘Rocket Pro TPO vs. UWM’ and its ‘About’ section describes the group as a ‘place where honest and uninfluenced conversations can take place,’ the main prerogative of the group seems to be to undermine UWM’s business, which Walker condones,” the lawsuit states.

Walker does not have authorization to use UWM’s trademark, which can cause confusion for customers, the company stated in the lawsuit.

Walker did not immediately respond to multiple requests for comment from HousingWire.

A spokesperson for UWM said the company had no comment.

UWM is the largest U.S. mortgage lender, originating about $108 billion in 2023, per Inside Mortgage Finance estimates. In 2021, the company imposed a controversial ultimatum, engaging in legal battles with its broker partners that sell loans to rivals Rocket Mortgage and Fairway Independent Mortgage Corp.

A visit to the Facebook page on Thursday morning revealed that the UWM logo is no longer being used. Instead, it has been replaced by a photo featuring Mat Ishbia, UWM’s CEO and president, and Dan Gilbert, the chairman of Rocket Companies.

Mortgage Solutions is a nondelegated correspondent lender with five branches nationwide and 138 licensed loan officers, according to the Nationwide Multistate Licensing System (NMLS).

The lawsuit states that Mortgage Solutions entered UWM’s wholesale broker agreement in January 2012. It agreed to offer several products such as FHA, VA, conventional and bond program mortgages.

In March 2020, the parties entered into a delegate correspondent agreement, which brought an early payoff provision indicating that Mortgage Solutions would reimburse UWM if a loan were paid off within 180 days.

But the lawsuit also states that at least 12 loans delivered by Mortgage Solutions were paid off within 180 days from June 2020 through May 2023, and UWM has not been reimbursed.

These mortgages allegedly represent a balance of $124,011.37 as of December 1, 2023.

UWM’s breach of EPO provision claim requests the payment of the balance, attorneys fees and other costs. It also asks for damages related to the use of its logo. 

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