Titan Lenders Corp President Mary Kladde was featured this week in an extensive article in the Credit Union Times, speaking as an expert resource concerning the current need for warehouse funding lines, warehouse funding options and strategies for credit unions, the current liquidity crisis, TARP funds and more.
In addition to giving a detailed overview of the current liquidity crisis and its causes, Kladde also provided insider perspective into how the current need for warehouse lending options is an advantage for credit unions:
“For the warehouse lender, the lack of competition has created a market climate that is risk averse, which definitely works in credit unions’ favor,” Kladde said.
Warehouse lines of credit may be among the safest entries because of the 15 to 30 day turnaround, Kladde said. She touts backing from the Federal Housing Administration and Ginnie Mae and “tightened” underwriting guidelines as selling points. With banks getting TARP funds, there is discussion that Ginnie Mae may even insure the credit lines “and that may also be good for credit unions.”
Meanwhile, credit unions may be leery of venturing out because of takeout risks. Kladde said warehouse lenders, once permissive of aging loans, can no longer afford the risk of loans not purchased in a timely manner. Takeout risk can be managed in this market through due diligence with regards to compliance, fraud and quality loan production, she explained.
“Titan often requires its correspondent partners to employ its closing and post-closing services to mitigate takeout loss, ensure swift salability and leverage Titan’s reps and warrants,” Kladde said. “Should lenders refuse to purchase or fail to honor a commitment to purchase, Titan has a broad base of experience in quickly repackaging loans for sale within the current market or as ‘scratch and dent.’”
Read the full article: “Door Opens for CU Warehouse Lending“.
