Planet Home Lending acquires Axia Home Loans

Planet Home Lending has acquired Axia Home Loans, supplementing its correspondent and retail operations with the West Coast-based lender’s retail footprint. 

A Planet Home Lending representative Tuesday confirmed the announcement shared in Rob Chrisman’s daily newsletter. The Connecticut-based lender and servicer originated $1.8 billion in loan volume last year according to Home Mortgage Disclosure Act data, double that of Bellevue, Washington-based Axia’s $900 million in origination volume in 2023. 

The acquisition would boost the company’s retail run rate to more than $240 million per month, a Planet Home Lending representative said. It’s unclear how Axia’s assets will integrate into Planet Home Lending’s operations, although Tuesday’s announcement said the move will expand the buyer’s branch footprint. 

Axia, according to Nationwide Multistate Licensing System records, has 55 active branches mostly based in the Western U.S. and 68 sponsored loan officers. Planet Home Lending meanwhile spans 40 branches coast-to-coast and has 177 sponsored LOs. 

Representatives for Axia didn’t respond to requests for comment Tuesday. 

Planet Home Lending last summer also expanded its West Coast footprint in acquiring assets from Illinois-based Platinum Home Mortgage. In 2022, the firm also purchased the correspondent line of since-shuttered HomePoint Capital. 

Axia is an employee-owned company and was founded in 2007. Chairman and CEO Alex Rosenblum has led the company since 2018.

Stratmor Group served as Planet Home Lending’s advisor for the transaction. Planet Home Lending paid a premium for Axia, but Garth Graham, senior partner at Stratmor, declined to discuss the price or how operations will be settled. 

“A lot of people will simply just assume that in many of these [merger and acquisition] transactions, there is no premium for the book, and there was a premium paid [in this case],” he said. 

As home sales and refinances have slowed down, there’s been roughly 125 transactions in the past three years, Graham said. Around 80% of those deals have been a larger independent mortgage banker scooping up a smaller firm to access branches, salespeople or origination channels during the market’s slowdown. 

However there’s been just 15 mergers and acquisitions through July, down 20% from last year’s pace, according to Stratmor. This number of transactions this year could fall well behind a busy 2022, when industry players completed 38 deals. 

Moves this year include Guild Mortgage’s acquisition of Utah-based Academy Mortgage; CMG Mortgage’s spring purchase of Norcom Mortgage’s retail division; and Stratmor’s own merger agreement with competing advisory firm Teraverde.

While over 80% of companies were still losing money in the first quarter, a stronger second quarter has brought the industry to a breakeven point, Stratmor said. Graham shared a cautionary word for mortgage lenders who are losing money quarter after quarter, who may still be within their covenants with warehouse lenders. 

“While we feel better that interest rates are beginning to come down and the second quarter is better than the first quarter … that doesn’t mean the warehouse bank will continue to be as patient going forward as it was in the past,” he said.