A proposal that would allow Ginnie Mae to give some type of assistance to the warehouse lending sector is moving closer to fruition, according to industry sources.
At press time, it was still unclear what role Ginnie Mae would play in the market but it's anticipated that it might provide certain guarantees on lines made to already approved Ginnie Mae issuers.
The agency could not be reached for comment at press time. The Mortgage Bankers Association (MBA) and other industry lobbyists have been working on the warehouse issue for months.
One MBA official said "we are closer" on a proposal that would be sent to the Treasury and the White House.
The official declined to give details. Non-banks that depend on warehouse lines have been starved for credit because many Wall Street lenders and banks have exited the market. Those that are left have been restrained in their lending because of high capital charges against outstanding warehouse lines. There are roughly 10 active warehouse lenders compared to 30 two years ago.