National City Warehouse Stops Approving Non-Agency Loans

Update: A kind gentleman from National City informed me that the email received was for smaller-scale mortgage bankers only; and that their larger-scale bankers are still operating "business as usual." The market for jumbo loans, pay-option loans and other non-agency mortgages just got a lot tighter... In a recent letter to correspondent lenders (no link sorry) National City announced that they will no longer be approving or funding any non-agency loans via their warehouse lines of credit. These credit lines are extended to their correspondent lenders as short-term financing allowing non-depository mortgage bankers to fund and close loans. The only loans now eligible for funding via National City's warehouse facilities are those that meet Fannie Mae and Freddie Mac guidelines - also known