A Star LO’s Ultimatum Sparks Ugly Legal Fight

Benchmark Mortgage just dropped a lawsuit that reads like a comp negotiation gone completely off the rails, accusing a longtime manager & a top-producing branch manager of leveraging the company’s own financial playbook against it.

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Here's the tea ☕: Benchmark says Marty Preston—who had access to the company's sensitive data by virtue of his leadership role—and Texas branch manager Denise “Mortgage Nerd” Donoghue allegedly spent weeks cooking up a scheme to use confidential P&Ls, branch-level margins, staffing costs & profitability data as leverage to squeeze Benchmark into a sweeter comp deal for Donoghue.

The alleged climax came at a March 18 meeting where Donoghue reportedly accused Benchmark of exploiting her & then showed them a slide deck of financials from 23 Benchmark branches. She allegedly admitted she'd already shopped that data to competitors & pledged to leave if she didn’t get what she was seeking. The lawsuit claims Preston was silent during the meeting.

Both Preston & Donoghue were terminated & Benchmark raced to the courthouse, arguing the leaked intel is some kind of secret sauce. Per legal filings, Benchmark is concerned a competitor could reverse engineer their whole model using the branch economics, pricing strategy, margins, staffing allocation to eat its proverbial lunch. Benchmark wants north of $1M in damages & wants the “secrets” to stop spreading.

Preston, the national business development director, had worked for Benchmark since ‘01. Donoghue, who joined Benchmark in ‘23 after a stint at Thrive, has done $107M in volume over the last year, per RETR. Neither immediately got back to me…

As for Donoghue’s next stop, The Scoop hears she’s joining Khai Nguyen’s AML. They both were at Thrive back in the day… 

For more on LO recruiting wars, check out our feature from a couple months back.

Several managers at Guaranteed Rate Affinity have been let go over the last month, sources told The Scoop. The group included growth managers & regional managers. Branch managers said they don’t escalate the files to them, so it shouldn’t change their day-to-day much.

A spokesperson did not get back to me on Monday.

I reported a few weeks ago that despite the big headlines, brass at GRA remains unbothered at the prospect of Compass’s MSA w/ Rocket/Redfin hurting business.

“You think they’re going to send a client to a call center in Ohio?” he said. “The OriginPoint/GRA people are still in the sales meetings, in the offices. They're on the ground doing networking events w/ Realtors, doing open houses & the Rocket people are in a call center far away."

In Q4 '25, 1,691 loans representing $563.2M in unpaid principal balance ("UPB") were repurchased from Fannie Mae and Freddie Mac, down 3.1% from Q3' 25.

Repurchases from Fannie Mae made up 52.6% of UPB compared to 51.1% in the prior quarter. Fannie Mae issued 655 new demands in Q4 '25 (a 21% reduction from Q3 '25) while Freddie Mac issued 705 new demands (a 28% reduction).

The overwhelming percentage of Fannie Mae resolutions continue to result in repurchase. Of total resolved repurchase demands (repurchased loans + withdrawn demands) in the quarter, 83% of Fannie Mae demands resulted in a repurchase, while 59% of Freddie Mac resolved demands resulted in a repurchase.

Repurchases in Q4 '25 were heavily concentrated in the Q1 '25 and Q2 '25 issuance vintages, which together accounted for 38.6% of total activity.

UWM, Rocket & Fairway had the largest share of repurchases in the quarter, at 6.9%, 6.0%, and 3.2% of total repurchases, respectively. Those three originators accounted for 8.8%, 8.6%, and 1.9% of new issuance in Q1 '25 and Q2'25 (the issuance vintages with the most repurchase activity in Q4 '25), respectively. This implies that UWM and Rocket have repurchase rates below the industry average while Fairway’s repurchase rates are above industry average.

This report is brought to you by Milliman. Milliman provides strategic and quantitative consulting services across the mortgage market with expertise in origination, servicing and capital investment.

Source: SEC; Note: includes loans originated since 2020 and excludes multifamily repurchase activity

UWM is quite unhappy w/ Two Harbors’ decision to blow up its agreement. It sounds like the lawyers are going to be plenty busy over the next few quarters. 

“The same team that had to settle a $375M lawsuit this past summer is at it again,” UWM said in a statement. “Two Harbors' decision appears to be driven more by ego, than by sound judgment.”

UWM added that it will look for other ways to grow its servicing book now that Two Harbors has decided to partner up w/ CrossCountry Mortgage. 

“The deal for us was a strategy to acquire their servicing book, not their operations, as ultimately there are no operational efficiencies to gain — UWM's operations are best in class,” UWM said. “Unlike Two Harbors’ business, which is effectively a melting ice cube, we are in growth mode & will continue to be the market leader for the wholesale channel in support of our broker clients and team members.”

If UWM were to grow its book via M&A, only a few big servicers would appear to be remotely available for purchase. In Friday’s paid edition, I shared which ones might fit the profile…

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