At least one dozen — and perhaps more — of Ally Financial’s nonbank warehouse lending customers are searching for back-up lines of credit, fearing the government-owned lender may soon cut back, according to interviews conducted by National Mortgage News this week.
“We have received multiple inquiries and a handful of applications [from Ally customers],” said one East Coast-based warehouse executive. “The confidence level of Ally’s warehouse customers is not very high at the moment.”
A warehouse official based in the Southwest added, “I don’t know anything specific, but people are preparing for the worst.”
Five different warehouse managers provided information to NMN under the condition their names not be used. A spokeswoman for Ally declined to comment on the matter.
Warehouse executives said at this point in time they have no solid information suggesting that Ally will pull out of the sector, but the bank’s somewhat recent decision to severely trim its correspondent purchases is fueling the fear.
Many (but not all) correspondent buyers of home mortgages cross-market their business in tandem with offering warehouse lines. Ally falls into that category.
In the first quarter Ally’s Residential Capital Corp./GMAC division earned $217 million, but its residential originations plummeted by 53%. The bank blamed the steep decline on its near-exit from the correspondent channel.
About a week ago ResCap missed a scheduled bond payment.