loanDepot (NYSE:LDI) executives said the company made early progress on efforts to increase scale and market penetration, highlighting its highest quarterly origination volume since 2022, market share gains, and a 71% recapture rate from its in-house servicing platform during the fourth quarter of 2025.
Founder and CEO Anthony Hsieh said the results reflected a “return to core competencies” that previously enabled the company to scale quickly, and he emphasized loanDepot’s focus on being a large, customer-facing originator in a retail mortgage market he described as “highly fragmented and inefficient.” Hsieh added that the company expects continued digital migration among customers—particularly purchase borrowers—and believes its technology and customer acquisition strategy can help it benefit as the market consolidates.
Fourth-quarter performance and product mix
Pull-through weighted lock volume was $7.3 billion, up 4% from $7.0 billion in the prior quarter and within the company’s prior guidance range of $6.0 billion to $8.0 billion. Adjusted total revenue was $316 million, compared with $325 million in the third quarter.
Gain-on-sale margin (pull-through weighted) was 324 basis points, at the high end of the company’s guidance range of 300 to 325 basis points, but down from 339 basis points in the prior quarter. Hayes said the margin decline primarily reflected product and loan-purpose mix. During the quarter, loanDepot originated relatively fewer higher-margin second trust deeds and FHA/VA loans compared with the third quarter as part of a strategy to capture more refinance volume, which also contributed to larger average loan balances and lower margin percentage.
Loan origination volume was $8.0 billion, an increase of 23% from $6.5 billion in the prior quarter and the highest level since 2022. That result was within the company’s prior guidance of $6.5 billion to $8.5 billion.
Servicing trends, MSR hedging, and recapture
Servicing fee income increased to $113 million from $112 million in the third quarter, which Hayes said primarily reflected increased collections due to growth in the unpaid principal balance of the servicing portfolio. He also noted that loanDepot hedges its servicing portfolio and therefore does not record the full impact of fair value changes in operating results, describing the approach as a way to help protect against volatility in earnings and liquidity.
During the Q&A, management addressed MSR amortization expense, which an analyst noted rose to $52 million in the quarter. Hayes said the quarter included a pickup related to higher refinance volumes, and that amortization could moderate in the first quarter, though it would depend on interest rate conditions.
Asked about recapture, Hsieh said the company expects to remain “around that level” following the 71% figure and suggested it could improve with technology and AI better predicting which customers may be in the market for another refinance. He added that he believes the company is “pretty much at the top of the house” in terms of recapture percentages.
Costs, hiring, and technology investments
Total expenses increased by $8 million, or 3%, from the third quarter. Hayes said the primary driver was higher personnel costs, with commissions rising on higher funded volume and salaries increasing mainly due to loan officer hiring and related operations staff. He added that remaining volume-related marketing and direct origination expenses were lower quarter-over-quarter despite higher volume, reflecting benefits from process improvements and technology initiatives.
Hsieh said the company has been focused on reducing unit costs through operating leverage and automation while continuing to invest in its marketing engine. He pointed to initiatives led by the digital team that introduced AI capabilities to repeatable functions intended to improve lead acquisition and conversion, loan officer CRM management, and underwriting processes. Hsieh said these initiatives were seeing wide user acceptance and should help drive operating efficiencies as volume increases.
In response to a question about 2026 operating leverage and non-volume-related expense growth, Hayes said the company expects “some modest investment” in technology and innovation initiatives. He said the rest of the expense growth would be volume-related, including loan officer additions and supporting operations staff. Hsieh added that as the company scales, most costs will be variable, while much of the fixed cost is “already baked into the year.”
Outlook and strategic initiatives, including wholesale
For the first quarter, Hayes guided to pull-through weighted lock volume of $7.75 billion to $8.75 billion and origination volume of $6.75 billion to $7.75 billion. The company expects pull-through weighted gain-on-sale margin of 270 to 300 basis points. Hayes said the outlook reflects market volatility, seasonality in purchase volume, housing affordability and availability, mortgage rate levels, and the company’s strategy of targeting larger average refinance loan balances. Total expenses are expected to increase in the first quarter, primarily driven by personnel and G&A expenses associated with investments in automation and innovation, partially offset by lower volume-related expenses.
In the Q&A, management discussed loanDepot’s distribution model, describing three channels: a digital-first direct lending business, in-market retail, and a builder business. Hsieh called the builder channel “predictable and stable,” with steady growth, and described in-market retail growth as driven by hiring local loan officers. He said the company sees significant opportunity in direct lending and is rebuilding its marketing funnel, lead management systems, CRM, and lead scoring, including efforts to “completely rebuild” the lead funnel engine using AI. Hsieh said the company is seeing “early wins” as volume and market share in the direct lending channel begin to improve.
Management also addressed the decision to re-enter the wholesale lending channel. Hsieh said wholesale would allow loanDepot to achieve greater scale, though it is a third-party origination channel where the company does not control the customer experience. He said additional volume could support operating efficiency, and that as the company anticipates volume growth and a potential return of refinance activity, it expects margins to expand, making the wholesale model more attractive. He called the current period “ideal timing” to return to wholesale.
On product dynamics, Hsieh said customers tend to shift toward cash-out refinances rather than HELOCs or closed-end seconds when rates drop, and he emphasized that loanDepot has the optionality to offer both. He said volumes can be similar because closed-end seconds carry higher margins in basis points but lower loan amounts, and that product mix shifts as mortgage rates move.
Liquidity and balance sheet notes
Hayes said the company ended the quarter with $337 million in cash, down $222 million from the prior quarter, reflecting investment in loan inventory and the full repayment of outstanding 2025 unsecured notes. He also summarized full-year 2025 progress, stating the company increased adjusted revenue by 10% year-over-year while limiting expense growth to less than 1%, which he said helped shrink the adjusted net loss by 31%.
In closing remarks, Hsieh reiterated four objectives: investing in growth and operational efficiency, becoming a “best-in-class mortgage banker,” growing profitable market share by expanding sales capacity across channels, and returning to profitability through customer acquisition, servicing portfolio growth, recapture, brand and marketing, and operating leverage. He said management believes the company can return to consistent profitability.
About loanDepot (NYSE:LDI)
loanDepot, Inc (NYSE: LDI) is a leading non-bank consumer lender that provides a broad range of home and personal financing products through a digitally enabled platform. The company specializes in originating and servicing purchase and refinance mortgage loans, home equity lines of credit (HELOCs), and personal loans. Through its proprietary mello™ technology suite, loanDepot streamlines the application, underwriting, and closing processes for borrowers and real estate professionals, emphasizing speed, transparency, and a seamless digital experience.
Founded in 2010 by Anthony Hsieh, loanDepot has grown rapidly to become one of the largest independent mortgage lenders in the United States.
