Warehouse lending comes of age: automation is bringing new efficiencies and transparency to the business of warehouse lending.
Mortgage Banking › Vol. 66 Nbr. 6, March 2006 ›
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Cover Report: Technology - Report
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Warehouse lending comes of age: automation is bringing new efficiencies and transparency to the business of warehouse lending.
Warehouse lenders provide short-term financing to mortgage lenders selling loans into the secondary market. Characterized as short-term lines of real estate-secured credit, warehouse lines allow mortgage bankers to fund loans in the secondary market until purchased by institutional investors. [??] Initially this was a niche market representing a small number of lenders, funders and investors. However, the demand for warehouse lenders and advanced warehouse-lending platforms has rapidly increased in recent years due to the continued strength and growth of the mortgage industry and the increasing interest of investors in mortgage-backed securities (MBS). Additionally, mortgage bankers are relying more on warehouse lines to significantly impact profitability and increase their agility in the marketplace. [??] According to the Reynolds Group, Summit, New Jersey, a consulting firm that specializes in mortgage banking advisory services and provides data for evaluating warehouse business processes, warehouse lending...
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