The Mortgage Partnership Finance Program, a part of the Federal Home Loan Bank of Chicago, will now offer a higher maximum loan on its MPF Direct product.
A single-family loan through the MPF product can now reach $1.5 million, an approximately 105% jump from the previous limit of nearly $730,000. The loan ceiling raise will take place early in this year's third quarter and is enabled by private-label securitization provided by a subsidiary of Redwood Trust, a California-based real estate investment trust.
The transaction is proof that for better or worse demand for mortgage-backed securities has begun to come back post-financial crisis.
"We are focused on helping FHLBank members that want to sell into the secondary mortgage market remain competitive," said Federal Home Loan Bank of Chicago executive vice president and group head John Stocchetti.
