Titan Lender’s Corp. President Mary Kladde discussed extending warehouse line capacity with Tony Garritano for the feature article of Mortgage Technology magazine’s May issue:
”Traditional warehouse lenders aside, for new entities looking to provide warehouse lines and make a profit, like private equity funds for example, business process outsourcing firm Titan Lenders Corp. sees the lack of liquidity as an opportunity. Earlier in the year, Titan launched a warehouse lending operations service platform that can speed private equity fund entry into a structured investment that collects interest at approximately 3 to 5 basis points per diem for a 15- to 30-day duration. GMI Home Loans, a New Jersey retail mortgage banker originating approximately $500 million per annum in conventional, FHA and reverse mortgages, encountered liquidity challenges soon after its launch in 2007 when access to warehouse line facilities began shrinking industry wide. GMI turned to NVC Premier Fund LLC, an entity managed by New Vision Capital Partners LLC, for its funds, and worked with Titan to develop a warehouse line process management platform.
“Our customers are small and midsized lenders,” said Titan founder and president Mary Kladde. “They’ve seen a huge reduction in warehouse lines. As a result, they were contacting us to see what lines were still open. We also received calls from community banks and private equity groups that were looking to provide buddy lines, especially at the end of the month when lenders need that bump.
“We signed an independent mortgage banker that reached out to their contacts and brought a private equity group onboard. However, the private equity didn’t just want to turn over the funds, they wanted diligence. We were selected to do that on their behalf. The capital investment to build the technology to diligence a loan would be prohibitive for a private equity firm, which is why we got involved. I don’t think Wall Street is going to pull us out of this, but there is opportunity for other institutions. Will they all come in? I don’t know if companies are willing to come in and do something news, but some are. I think there’s a lot of interest out there.”
Read the full article here: “Extending Warehouse Line Capacity“
