Warehouse Lending in Today's Changing Market

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Presentation transcript:

Warehouse Lending in Today's Changing Market Presented by Stanley M. Street Consulting. Technology. Information. Expertise for Warehouse Lenders

Warehouse Lending in Today's Changing Market Emerging from Chaos At no time in the history of mortgage banker finance has the industry seen such an upheaval in the supply of warehouse funds or such a radical change in interim mortgage financing terms and conditions.

Warehouse Lending in Today's Changing Market Emerging from Chaos Continued Shrinking of the Warehouse Marketplace 25% Fewer Suppliers 40% Decline in Commitments 44% Decline in Balances Outstanding

Warehouse Lending in Today's Changing Market Emerging from Chaos Tremendous Redistribution of Warehouse Customers Elimination of Single Large Lender Lines Multiple Mid-Tier Lender Replacement Lines

Warehouse Lending in Today's Changing Market Emerging from Chaos Severe Adjustment in the Overall Business Model Company Approval and Renewal Process Risk Management Requirements Guidelines and Conditions Haircut Percentages Risk-Based Pricing

Warehouse Lending in Today's Changing Market Emerging from Chaos Continued Worries About Covenant Compliance Increased Investor Repurchase and Delivery Risk Falling Secondary Marketing Profits Reliable Collateral Valuation Regulatory Involvement

Critical Continuity of Funds Warehouse Lending in Today's Changing Market Critical Continuity of Funds Access to reliable mortgage warehouse financing from multiple suppliers is critical for both survival and success. "No cash, no credit, no business" is still a valid mortgage banking mantra - warehouse lines are a necessity of the secondary market process.

Warehouse Lending Trends Warehouse Lending in Today's Changing Market Warehouse Lending Trends Embracing Newer Technologies eMortgage Capable Real-Time Processing and Communication Integrated Validation and Risk Management Services Access to Key Analytical Originator and Investor Data

Warehouse Lending Trends Warehouse Lending in Today's Changing Market Warehouse Lending Trends Re-Engineering Business Processes Electronic Workflow Increased Efficiencies Improved Business Intelligence Automated Decision Trigger Points

Warehouse Lending Trends Warehouse Lending in Today's Changing Market Warehouse Lending Trends Reverting to Rational Pricing Adapting to New Pricing Models Fees Interest Rates Risk Based Pricing Portfolio Product Mix

Warehouse Lending Trends Warehouse Lending in Today's Changing Market Warehouse Lending Trends Standardizing Business Practices Warehouse Information Networksm Uniformity eMortgage Dataflow and Funding Process

Your Most Important Strategic Relationship Warehouse Lending in Today's Changing Market Your Most Important Strategic Relationship Avoid irrational pricing and burdensome operational changes that compensate for legacy portfolio problems Align with future-oriented, multi-service warehouse providers that adopt innovative technologies Monitor financial strength and management commitment to warehouse lending as an ongoing business unit

Thank You! Stanley M. Street sstreet@streetresource.com 770-390-3000 Warehouse Lending in Today's Changing Market Thank You! Stanley M. Street sstreet@streetresource.com 770-390-3000 Expertise for Mortgage Warehouse Lenders