Rocket Companies shares jumped on Tuesday after CEO Varun Krishna told CNBC the company was writing a larger amount of mortgage loans.
“We’re getting ready for our earnings call here in just a couple of weeks, and I will share with this group that we’re on track to produce the highest mortgage loan production in terms of volume that we’ve had in four years, and the highest gain on sale that we’ve had in four years as well,” Krishna said on CNBC’s “Squawk Box.”
Rocket shares were last up about 6.3%, jumping as Krishna shared the news. Rocket reports on February 19.
Rocket Cos., 1 day
The rate on a 30-year mortgage dropped 22 basis points to 5.99% last month, matching the low from Feb. 2, 2023, according to Mortgage News Daily. The decline came after President Donald Trump said on social media that he is instructing mortgage giants Fannie Mae and Freddie Mac to buy $200 billion in mortgage bonds.
Rocket’s advantage stems from its ability to retain customers by tightly linking mortgage servicing and origination, the CEO said. Rocket keeps relationships intact through its servicing platform, allowing it to recapture borrowers when they return to the market for a home purchase or cash out refinance, he added.
“When they’re ready for their next purchase, when they’re ready for a cash out refinance, Rocket is there with a great experience, powered by AI. And because of that, we’re able to retain our clients, whereas other players simply lose the asset,” he said.
Krishna said Rocket is optimistic about the broader housing outlook. Industry forecasts point to mortgage market growth of as much as 25% through 2026, while existing home sales could rise by up to 10% as affordability improves and pent-up demand returns, he noted.
