SoFi Buys Wyndham for Mortgage Loans

SoFi has acquired Wyndham Capital Mortgage to broaden its offerings to prospective homeowners.

The all-cash purchase, announced in a Monday (April 3) press release, lets SoFi enhance customers’ digital mortgage experience while reducing the company’s use of third-party partners and processes.

“Several macro- and socioeconomic factors — high inflation and rising mortgage rates, the new world of work and others — have ushered in a new era across the U.S. real estate market,” said SoFi CEO Anthony Noto in the release. “These changing conditions mean it’s more important than ever that borrowers have a trusted partner they can look to as they go through the process of obtaining a mortgage for a home.”

The conditions Noto cited have left consumers with dwindling hope that homeownership is within reach, according to the PYMNTS report, “Consumer Inflation Sentiment: Rising Housing Costs Deflate Economic Optimism.”

That study found a 7% decrease in consumers’ belief that buying a home is possible, with Generation Z being hit the hardest. Whereas 35% of that group believed homeownership was within reach in January 2021, the number had fallen to 29% in January 2023.

“The reality of owning a home may take longer than many first-time buyers hoped,” PYMNTS wrote last month. “However, there may be some comfort in remembering that like other economic cycles, historically the housing market evens itself out and rates will return to normal.”

SoFi said in the release its purchase of Wyndham — no dollar amount was listed — “is not expected to be material to the company’s 2023 financial outlook,” although “it is expected to be accretive within six months.”

SoFi earlier this year reported positive earnings results in the face of macroeconomic headwinds thanks to demand for personal loans, direct deposit accounts and “cross-buy” opportunities.

Total deposits at SoFi Bank rose 46% sequentially during the fourth quarter to $7.3 billion, with 88% of SoFi Money deposits — across checking, savings and SoFi Money cash management — coming from direct deposit customers.

More recently, the company said it was working with a number of banks to offer SoFi Checking and Savings members up to $2 million of FDIC insurance on their deposits in the wake of last month’s banking failures.

“By offering access to up to $2 million in FDIC insurance, we are making sure our members have peace of mind about their money at SoFi,” Noto said in a March 22 news release. “We know the last few weeks have been unnerving for many consumers, and we hope this helps.”