After a five-year run, Rocket Cos. announced plans to shutter its Canadian mortgage business.
The U.S. lending giant, which offers mortgage brokerage services north of the border, will cease operations in Canada on June 27, it said. The company assured customers that transactions in process would be fulfilled with support provided throughout the transition.
“While this means stepping away from our lending business in Canada, we thank our team members who have helped us expand over the last five years. Their hard work and passion have helped thousands of Canadians achieve the dream of homeownership and we appreciate all their contributions,” Rocket Mortgage Canada said in a statement.
Rocket’s other Canadian subsidiaries, technology development firms Lendesk and Rocket Innovation Studio, would not be affected, it said.
The decision to close shop in Canada comes as Rocket realigns its home lending strategy to focus exclusively on the U.S. housing market, the company added. Rocket initially entered the Canadian market in 2020 under prior leadership through its investment in mortgage brokerage Edison Financial, eventually serving customers in every province.
With offices located in Windsor, Ontario, directly across the river from the parent company’s home base of Detroit, Edison later rebranded to Rocket Mortgage Canada in 2022. At that time, the company employed 140 staff and said it intended to offer direct lending in the country.
Edison’s founder is current Rocket Mortgage Canada President Hash Aboulhosn, who launched the company in 2017 before later taking a leadership position at Lendesk.
Global economic challenges and surging interest rates placed obstacles in its ambitions, however, and Rocket Cos. ended 2024 with a U.S. $21.5 million pre-tax loss from operations in Canada, according to its latest annual report. The number was one of the few blemishes in Rocket’s full-year earnings, with company-wide pre-tax profits across all divisions coming in at more than $668 million.
Dismissed employees will receive a severance package that includes three to six months of salary, extension of health coverage and career-transition assistance. Some staff will be able to find positions at Lendesk or Rocket Innovation Studio.
Since current CEO Varun Krishna took over the helm at Rocket in 2023, the company has embarked on a noticeable marketing and strategy shift, emphasizing growth in artificial intelligence investments. The company is attempting to position itself as the top innovator in technology development for the entire home finance ecosystem without sacrificing its position as one of the mortgage industry’s leading lenders in the U.S.
Moves made by Krishna to support the company’s tech-focused strategy is evident in top personnel hires. Instead of drawing from the home lending community, Krishna, a former executive at Paypal, has frequently looked toward the fintech space when adding new leaders during his tenure, including former managers at the likes of Airbnb and Venmo.
This year, the company also moved forward on efforts to combine all Rocket businesses, including wholesale lending, title and personal finance companies, under a single unifying theme and logo, with subsidiaries rebranded to reflect the new marketing.
