MarketWise Commentary
Week of Ending September 15, 2007
This week marked a death blow to two important warehouse lenders. Both First Collateral and Washington Mutual reportedly exited the business. Countrywide established an additional line of credit for 12B while at the same time announcing that it is trimming its staff by up to 20%.
This is further evidence that the days of the independent mortgage banker are getting more difficult as access to warehouse credit to close loans becomes more difficult to obtain. On the positive side, origination volume continues to move along at a brisk pace with many depository institutions seizing the opportunity to fill the vacuum. Congress is picking up the heat to reform the mortgage industry and MarketWise expects significant reform that will reshape the landscape requiring all mortgage originators to be licensed. Clearly, all government sponsored agencies including Fannie Mae, Freddie Mac, Ginnie Mae and the Federal Home Loan Bank’s are all under pressure to help stem issues within the mortgage industry.
On a separate front, the very crowded field of mortgage origination technology vendors is starting to crack. Portellus and Arc Systems announced publicly this week that they were seeking to strategically place their intellectual property. Events this week are likely to balance upon how the actions of the Fed on interest rates
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