San Diego, CA — (SBWIRE) — 07/08/2021 — An investor, who purchased NASDAQ: HMPT shares, filed a lawsuit over alleged violations of Federal Securities Laws by Home Point Capital Inc. in connection with the company’s January 29, 2021 initial public offering (the “IPO”).
Investors who purchased shares of Home Point Capital Inc. (NASDAQ: HMPT) have certain options and for certain investors are short and strict deadlines running. Deadline: August 20, 2021. NASDAQ: HMPT investors should contact the Shareholders Foundation at email@example.com or call +1(858) 779 – 1554.
Ann Arbor, MI based Home Point Capital Inc., together with its subsidiaries, operates as a residential mortgage originator and service provider. The Origination segment sources loans through direct, wholesale, and correspondent channels. The Servicing segment offers collecting loan payments; remitting principal and interest payments to investors; managing escrow funds for the payment of mortgage-related expenses, such as taxes and insurance; and performing loss mitigation activities on behalf of investors and administering mortgage loans. From 2018 to 2020, Home Point Capital Inc undertook an aggressive expansion of its Broker Partner network, increasing the network from 1,623 as of December 31, 2018 to nearly 5,000 as of September 30, 2020, which represents an annualized growth rate of 88%.
In the fourth quarter of 2020, mortgage lenders industry-wide began predicting decreased gain-on-sale margins, the difference between the retail and wholesale cost of a mortgage, for the succeeding three months. According to the Fannie Mae Q4 2020 Mortgage Lender Sentiment Survey, only 19% of lenders foresaw a spike in profit margins compared to 48% in the prior quarter, 33% believed profits would hold steady, while 48% expected a decrease in profits.
On January 8, 2021, Home Point Capital Inc filed a registration statement on Form S-1 with the SEC in connection with the IPO, which, after amendment, was declared effective on January 28, 2021 (the “Registration Statement”).
On January 29, 2021, Home Point Capital Inc conducted the IPO, issuing 7.25 million shares of the Company’s common stock to the public at the Offering price of $13.00 per share for proceeds of $88,123,750 to the selling stockholders before expenses and after applicable underwriting discounts and commissions.
On February 1, 2021, Home Point Capital Inc filed a prospectus on Form 424B4 with the SEC in connection with the IPO, which incorporated and formed part of the Registration Statement (the “Prospectus” and, together with the Registration Statement, the “Offering Documents”).
On May 6, 2021, Home Point announced the Company’s financial results for the first quarter of 2021. Among other results, Home Point reported revenue of $324.2 million, missing consensus estimates by $41.72 million.
The plaintiff claims that Offering Documents that were filed in connection with the company’s IPO made false and/or misleading statements and/or failed to disclose that Home Point’s aggressive expansion of its broker partners would dramatically increase the Company’s expenses, that the mortgage industry was anticipating industry-wide decreased gain-on-sale margins as a result of rising interest rates in 2021 and Home Point would be subject to the same competitive pressures, that accordingly, the Company had overstated its business and financial prospects, and that as a result, the Offering Documents were materially false and/or misleading and failed to state information required to be stated therein.
Those who purchased shares of Home Point Capital Inc. (NASDAQ: HMPT) have certain options and should contact the Shareholders Foundation.
Shareholders Foundation, Inc.
3111 Camino Del Rio North – Suite 423
92108 San Diego
About Shareholders Foundation, Inc.
The Shareholders Foundation, Inc. is a professional portfolio monitoring and settlement claim filing service, , which does research related to shareholder issues and informs investors of securities class actions, settlements, judgments, and other legal related news to the stock/financial market. Shareholders Foundation, Inc. is in contact with a large number of shareholders and offers help, support, and assistance for every shareholder. The Shareholders Foundation, Inc. is not a law firm. Referenced cases, investigation, and/or settlements are not filed/reached and/or related to Shareholders Foundation. The information is provided as a public service. It is not intended as legal advice and should not be relied upon.