Mortgage Industry News

Titan’s Ruth Lee was featured in this month’s Secondary Marketing Executive explaining what the mortgage industry needs to do to solve the current warehouse lending liquidity crisis (“Market Insight: A DIY Approach to the Crisis”):

 ”Another new company in the warehouse sector is Titan Lenders Corp., based in Denver. Ruth Lee, vice president of sales, echoed [Jerry] Davis’ concerns by calling for a “grassroots” effort to unplug the warehouse lending logjam.

“The 2006-2007 market is very much gone,” she said. “If we, as an industry, are going to wait for glacial response from Congress or the Fed, I think we’ll be missing the boat. I think that we, as an industry, have a responsibility to fix the problem, because it doesn’t seem like there is any big watershed of interest coming about.”

Lee added that time is not the industry’s ally. “We are watching companies that are desperate today,” she said. “They need the warehouse line – it is a business-ending event. Right now, there’s not much out there.”

We will stay on the forefront of the discussions and keep pushing for necessary, intelligent action in this area. More updates coming!

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“