Loan originations increased 7% year over year as company posts record quarter in home equity loans
Mortgage giant Rocket Companies reported $1.3 billion in adjusted revenue for 2025’s first quarter, with closed loan origination volume jumping thanks in part to a surge in home equity loans.
The company had $21.6 billion in closed loan origination volume in Q1, a 7% bump over the previous year. Net rate lock volume was $21.6 billion, a 17% increase year over year.
Varun Krishna, CEO and director of Rocket Companies, touted the strength of the company’s platform and increased integration as driving forces in the first quarter.
“We entered 2025 with strength, delivering $1.3 billion in adjusted revenue, at the high end of our guidance range in the first quarter. This demonstrates the power of the Rocket platform and our ability to execute in any market," Krishna said. "With Redfin and Mr. Cooper, we are accelerating our mission to ‘Help Everyone Home.’ By integrating home search, origination, and servicing into one platform, Rocket is building the future of homeownership."
However, like competitor UWM, Rocket reported an overall loss of $212 million for the first quarter. The adjusted net showed an income of $80 million in the quarter. As was the case for UWM, a large portion of the loss was attributed to the change in fair value of mortgage servicing rights (MSRs). This accounted for a $449 million loss on the balance sheet.
The gain on sales margin in the quarter was 2.89%, a 22 basis point decrease year over year. Total liquidity was $8.1 billion as of March 31, 2025.
The company expects adjusted revenue to fall between $1.175 billion and $1.325 billion in the second quarter.
Acquisitions a huge portion of Q1
Two major acquisitions drove the headlines for Rocket in the first quarter. On March 10, the company announced an all-stock acquisition of Redfin for $1.75 billion in equity. Just 21 days later, Rocket announced the purchase of Mr. Cooper for $9.4 billion in equity.
Rocket Companies is transforming homebuying with its $9.4B acquisition of Mr. Cooper Group and $1.75B offer for Redfin. CEO Varun Krishna aims to create a seamless homeownership experience from search to servicing.
— Mortgage Professional America Magazine (@MPAMagazineUS) April 1, 2025
https://t.co/pRLnoBoEoK
“Servicing is a critical pillar of homeownership, alongside home search and mortgage origination,” Krishna said. “With the right data and AI infrastructure, we will deliver the right products at the right time. That’s how we build lifelong relationships, by proactively unlocking benefits and meeting needs before they arise.”
These two acquisitions are the latest steps by the company to continue building an all-encompassing mortgage platform that works with customers from the time they consider a loan through to when the loan is paid off. Jay Bray, Mr. Cooper Group chairman and CEO, echoed Krishna's thoughts.
“Mr. Cooper has been on a journey to transform the homeownership experience, and we have built the most advanced servicing platform in the mortgage industry,” Bray said. “By combining Mr. Cooper and Rocket, we will form the strongest mortgage company in the industry, offering an end-to-end homeownership experience backed by leading technology and grounded in customer care.”
To help support these acquisitions, the company secured a $1.15 billion revolving credit facility, which could increase to $2.25 billion once the Mr. Cooper acquisition closes.
Loan volume increases year over year
In direct-to-consumer loans, Rocket outpaced Q1 2024. In the first quarter, sold loan volume was $11.3 billion, an increase from $9.05 billion last year. Total net revenue dropped from $1.09 billion last year to $758 million this year, although adjusted revenue increased from $873 million to $1.02 billion.
Loan volume in the partner network also increased year over year. This year, the volume was $9.2 billion compared to $7.8 billion in Q1 2024. Net and adjusted revenue in this sector dropped from $170 million last year to $114 million this year.
Other highlights noted by the company in the first quarter included new API integrations to help streamline the loan process. They also completed integration with loan origination platform ARIVE, used by more than 20,000 brokers nationwide.
In February, the company launched a program offering a 10% promotion credit of their annual rent, up to $5,000, to support a path to homeownership. They also announced a rate break buy down in February and launched an improved AI tool to help determine the party responsible for paying the transfer tax fee.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
