Warehouse Lending
Definition of 'Warehouse Lending'A line of credit extended by a financial institution to a loan originator to fund a mortgage that a borrower initially used to buy a property. The loan typically lasts from the time it is originated to when the loan is sold into the secondary market, whether directly or through a securitization. |
|
Investopedia explains 'Warehouse Lending'Loan originators depend on the eventual sale of a loan to repay the warehouse lender; therefore, warehouse lenders closely monitor each loan's progression with the originator toward its eventual sale. To ensure the repayment of warehouse lines of credit, warehouse lenders typically require a small charge for each transaction as well as for when the originators post collateral. |
Related Definitions
Articles Of Interest
-
Profit From Mortgage Debt With MBS
Mortgage-backed securities can offer monthly income, a fixed interest rate and even government backing. -
Behind The Scenes Of Your Mortgage
Four major players slice and dice your mortgage in the secondary market. -
How Mortgage Refinancing Affects Your Net Worth
Find out how to determine whether refinancing will put you ahead or even more behind. -
What is a tranche?
"Tranche" is actually a French word meaning "slice" or "portion". In the world of investing, it is used to describe a security that can be split up into smaller pieces and subsequently sold to ... -
How Line of Credit Works
A line of credit is an arrangement where a bank offers a maximum loan amount that the borrower can draw upon at any time. The borrower – which can be an individual, business or government ... -
Why Your Pension Plan Has Sovereign Debt In It
One type of security pensions tend to invest in is sovereign debt, or debt issued by a government. -
6 Popular ETF Types For Your Portfolio
Exchange traded funds are an extremely popular diversification tool that can protect your portfolio during troubled periods. -
Top 5 Budgeting Questions Answered
You don't need a degree to understand your money, begin saving and pay down debt. -
Asset Allocation: The First Step Toward Profit
Understanding the different asset classes is an essential part of portfolio diversification. -
Junk Bond
Find out more about these bonds that have a high risk of default.
Free Annual Reports