In the November 24, 2010, issue of the Federal Register (75 F.R. 71724), the Department of Housing and Urban Development (HUD) published Notice that it is considering issuing RESPA guidance regarding warehouse lending and other financing mechanisms used to fund federally related mortgage loans. HUD states that it is seeking information on the current state of warehouse lending and how that method of funding currently operates within residential real estate mortgage transactions and wants input from the mortgage lending industry and others. To accomplish this, the Notice poses ten questions, some of which contain follow-up questions. Those persons interesting in responding to the Notice, however, are not limited to answering these questions and may provide any relevant information regarding warehouse lending and other mechanisms currently used to fund federally related mortgage loans. If you wish to respond to HUD’s Notice, you must do so by mail or electronically in the manner set out in page 71724 of the Notice (facsimile comments will not be accepted). The due date for comments is December 27, 2010. The Notice may be accessed at: For your convenience, republished below are the ten questions posed by HUD: (1) What are the general characteristics of warehouse lending in the context of mortgage loan financing? Specifically: (a) How does a warehouse lender provide funding to loan originators (e.g., through a line of credit; by funding individual loans; any other method)? If funding is provided through a line of credit, what characteristics indicate a bona fide warehouse line of credit? With regard to each type of funding provided, what criteria does the warehouse lender use to determine that it will provide funding to a loan originator?

Complete Memorandum