Guild Mortgage sees 69% increase in mortgage volume in Q2

Guild Mortgage is seeing benefits from its efforts to gain market share, more than doubling its loan volume and posting a 32% increase in net income in the second quarter. And after several acquisitions in recent years, it is still looking more expansion opportunitiesthe directors said.

Mortgage and servicer volume rose to $6.5 billion, up from $3.9 billion in the first quarter of this year, up 69%. Purchases made up the majority of that volume (92%), the company said.

Net income as of June 30 increased to $37.6 million compared to $28.5 million in the previous quarterGross profit margin fell 10%, from 364 basis points to 326 basis points, the earnings report showed.

“Our second-quarter results demonstrate Guild’s highly successful strategy to expand market share by investing in people and technology to drive growth in our origination and servicing portfolio,” said Terry Schmidt, Guild’s CEO, in a written statement. “We are also pleased to deliver strong adjusted net income of $30.7 million as we continued to grow and integrate the acquisition of Academy Mortgage.”

Guild’s service segment net income fell 17% to $69.5 million from $83.9 million in the prior-year quarter. The unpaid capital balance of the service portfolio increased to $89.1 billion, up 3% from $86.3 billion at the end of March.

The mortgage lender expects to see an increase in business opportunities across its portfolio as “homeowners look to refinance or purchase new homes as housing market dynamics and interest rates stabilize,” said David Neylan, Guild’s president and chief operating officer, during Thursday’s earnings conference call.

“We have identified a significant portion of our loan portfolio that will be able to benefit from new funding opportunities as interest rates decline,” Neylan said.

Another bright spot for the company is its drive for innovation in internal technologies, Schmidt emphasized. The lender and servicer recently launched an internal AI chatbot called GuildGPT to help your loan officers instantly search the company’s database.

“Our continued investment in technology, strong product offerings, broad customer base and continued commitment to local relationships through origination and service position Guild’s platform to continue to drive organic growth as market conditions improve,” the company’s CEO added in a written statement.

Since GuildGPT launched in June, about 2,000 employees have tested it. The tool has helped answer more than 20,000 questions from team members, the company said in a recent press release.

Guild’s desire to expand remains, and Schmidt emphasized that the company “will continue our pursuit of selective acquisitions that align with our model and culture as we seek to deliver significant growth and value to our shareholders over time.”

Over the past year, Guild Mortgage has been pushing to grow its market share nationwide, acquiring five mortgage lenders starting in 2022. The company was able to make these acquisitions because of its service model, which it calls “the cornerstone of (its) success.”

Guild employs 2,863 sponsored loan origination workers, according to the National Multi-State Licensing System.