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Questions about Warehouse Lines of Credit
What types of Warehouse Lines of Credit are there?
Affinity lines are essentially Warehouse programs that investors provide to their key originators. There are basically two types of Warehouse lines; Affinity lines and Non direct lines. Affinity lines may have slightly lower costs and provide ways to pass on rebates. The MBS Group with warehouse lending specializes in providing warehouse lines of credit to existing and emerging mortgage bankers nationwide. A warehouse line of credit is a revolving line of credit. Money is borrowed on the line and added to your bottom line with a warehouse line of credit. Learn more about the warehouse lines of credit provied by MBS. We have the cash flow and credibility needed to make the leap. These Affinity lines provide for the funding of loans to that particular Investor and generally only a handful of other Investors. You may be charged a premium if you are allowed to place other loans on your line to be sold to other Investors, which limits your flexibility for a warehouse line of credit. However, you may be limited to the product types allowed on the line and you may be required to place a certain percentage of business with the provider of the line or be subject to additional fees. Most of these warehouse line have a 1 to 5% haircut that requires you to have to come up with some of your own funds in order to close each loan. These Non-directed lines tend to operate with greater flexibility. Non direct lines are pure warehouse lines of credit facilities. You may have the ability to do third party origination’s (wholesale) and bulk loans on certain types of lines. You generally have more choices with the investors used, the time spent on the line and the number of product types available to fund on the line. Non-directed lines tend to operate more efficiently, although they may cost slightly more. This ability is very important to originators of Sub Prime product.
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The MBS Group offers numerous programs on warehouse lines of credit, contact us today.
