MPF Direct allows members of a Federal Home Loan Bank (FHLB) that participate in the MPF Program to deliver eligible jumbo mortgage loans through the program's operational platform to a subsidiary of Redwood Trust. This arrangement adds private capital to the secondary mortgage market.
The increase will take effect early in the third quarter, MPF says in a press release.
‘We are focused on helping FHLB members that want to sell into the secondary mortgage market to remain competitive,’ explains John Stocchetti, executive vice president and group head for the MPF at the FHLB of Chicago, which operates the MPF Program for the FHLB System. ‘The increase in the MPF Direct product's loan limit is intended to help members that operate in urban or other areas where home prices are higher than the national average.’
Currently, the FHLBs in Atlanta, Boston, Chicago and San Francisco are approved to offer MPF Direct.