Rocket’s ‘Apple of homeownership’ flywheel is getting more complex

The deal, which is expected to close in the fourth quarter of 2025, integrates the largest servicer in the country into Rocket’s flywheel. It’s presumably the next step in Krishna’s quest to make Rocket the Apple of homeownership.

“We want to build an integrated homeownership platform, and there’s three pieces to that,” Krishna said. “There’s interacting with the consumer at the top of the funnel as they go through the experience of searching for a home or selling a home. There’s the origination process, which is all of the financing, title closing, and then servicing, where they essentially develop a lifetime relationship. And then there’s recapture, which allows for repeat transactions.

“As Jay and I started talking, we found a shared view of what’s possible when origination and servicing come together. Mr. Cooper is an amazing company. They’ve built great technology on a massive scale. And when we think about just the ability for that business to be complementary to Rocket to create a more balanced company against rate cycles, the amount of data that comes into the ecosystem to power better AI-driven experiences — and then just the recapture potential of being able to serve those clients with new products and services — it just made sense.”

Bray echoed Krishna’s expectations for recapture opportunities.

“If you think about what Rocket’s created as the most iconic brand in the industry and the greatest recapture capability in the market, and then you marry that with our 7 million customers, it’s pretty magical,” Bray said. “We think we can deliver a great experience for those customers and that retention is going to be a critical piece of the flywheel that’s going to get turbo-charged with this transaction.” 

Krishna said that a strong, shared vision between him and Bray led to talks about their companies taking a big step together. As the two executives built a relationship and recognized synergies between Rocket and Mr. Cooper, a deal fell into place.

Krishna believes this deal, along with Rocket’s purchase of Redfin and other landmark announcements made this year, significantly changes the landscape of the mortgage industry.

“It’s time for modernization,” Krishna said. “And fundamentally, that’s one of the reasons I joined the space. I saw a process that I felt was broken, riddled with friction and ultimately not benefiting the person who matters most — and that’s the client.”

Krishna also hinted that Rocket is still open to future partnerships.

“We think that this is the ideal state of where the industry should be going, and we hope that this inspires others. … We’re happy to work with those players as well as they want to join.

“I just think that the industry has been antiquated for a long time. We now have the opportunity to change that, and that’s going to require partnership. That’s going to require technology. It’s going to require fortitude, and we are proud to champion that.” 

Marrying tech stacks and culture

A deal of this magnitude doesn’t just involve the marrying of company cultures. Rocket and Mr. Cooper, which each have their own technology platforms, need to be integrated and also mesh with Redfin’s technology (assuming that both deals close).

Mr. Cooper controls a reported 20% stake in mortgage servicing platform Sagent, while Rocket uses ICE Mortgage Technology’s MSP servicing platform. Rocket plans to transfer its MSR portfolio to Sagent, according to an investor note from Keefe Bruyette Woods.

Krishna and Bray said they’re not worried about combining each company’s technology stacks, values and visions. 

“From the Mr. Cooper perspective and the Rocket perspective — as well as the Redfin perspective — we’ve done this before,” Krishna said. “We’ve worked on deals, we’ve done integrations, and I’ll let Jay speak to it, but I think his track record of success speaks for itself.

“Ultimately, I think you have to be clear about your principles. You need to operate with rigor, you need to have the right team and you need to follow a playbook.”

Bray said that Mr. Cooper is highly confident it can complete an integration without any disruption. Both executives said it helps that each platform is AI-focused. 

“Rocket has built a world-class loan origination platform, and Mr. Cooper has built a world-class servicing platform. These technology stacks are very complimentary to each other, and they’re both AI-driven at the core,” Krishna said.

“Rocket is a good example of where AI has given us tremendous benefits. We’re on track to save our team members a million hours in efficiency on the origination side of the business, just by simply investing in better data, better models, more automation, more personalization, and just making our team members more productive.

“I think what’s also pretty cool is when you look at the combined dataset between these companies collectively — across Rocket, Redfin and Mr. Cooper — it will triple from where Rocket was before these deals.”

“If you look at where we’ve invested the most, where our AI tools are making the biggest impact, it is in the servicing platform,” Bray added. “We onboarded the Flagstar acquisition, $300 billion-plus, and we didn’t add any team members because of the scale capacity and, candidly, because of the investments we’ve made in tech.

“And so it’s a perfect marriage because you have a remarkable origination platform, and then we have the servicing piece of that.”