Ohio Sues United Wholesale Mortgage Over Alleged Broker Collusion

The state of Ohio has launched a legal battle against one of the nation’s top mortgage lenders, accusing United Wholesale Mortgage LLC (UWM) of orchestrating an anticompetitive scheme that violated state consumer protection laws and allegedly cost Ohio homebuyers millions in inflated fees and interest rates.

According to a statement from the Ohio Attorney General’s office, the Michigan-based lender misled thousands of Ohio residents into believing they were securing competitive mortgage deals through independent brokers. Instead, the lawsuit claims, UWM maintained an undisclosed stranglehold on the process—colluding with brokers to steer nearly all loan business back to itself.

Between 2021 and 2023, UWM allegedly originated around $605 million in home loans across Ohio under the guise of a broker-led market comparison, per a statement from the Attorney General. But investigators say the reality was far from transparent: roughly 99% of those transactions were funneled through brokers allegedly operating under UWM’s influence, raising serious concerns of collusion and market manipulation.

The legal complaint cites violations of Ohio’s Residential Mortgage Lending Act and the state’s Corrupt Practices Act, alleging deceptive conduct that hindered fair market competition and misled consumers. State officials contend that UWM’s practices directly contradicted their promise of saving borrowers money by offering access to multiple lenders.

In response, a spokesperson for United Wholesale Mortgage dismissed the lawsuit as politically motivated and without merit. “We had no prior knowledge or warning of this lawsuit filed by the Ohio Attorney General, which is in and of itself suspicious,” the company stated. UWM also noted that the allegations largely mirror those from a separate lawsuit filed previously by a law firm tied to a hedge fund, adding that they are pursuing sanctions in that case and plan to take similar action here.

Despite the company’s denials, Ohio officials say the alleged scheme had far-reaching effects on the state’s housing market, claiming it deprived consumers of true choice and fair pricing in mortgage lending. The state is now seeking restitution for affected borrowers, civil penalties, and a court order mandating future compliance with Ohio law.

Source: WKYC