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Product and Service information for FHLBank Pittsburgh members

Mortgage Lenders Realize Benefits of Original MPF^® Product
By Deanna Copeland, MPF Product Manager

Now that the nation’s economy is rebounding and more homebuyers are stepping back into the market, mortgage lending is again on the rise. If your institution currently participates in the Mortgage Partnership Finance^® (MPF^®) Program, you might consider expanding your use of the Original MPF product. Or if you are not yet participating in the MPF Program at all, maybe the time has come for you to take advantage of the program’s many benefits for the first time.

Under the Original MPF product, the risks associated with home mortgage finance are shared with FHLBank Pittsburgh to maximize competitive advantages. While members manage the credit risk, FHLBank manages the liquidity, interest rate, and prepayment risks of the loans. Members also retain the servicing and the important customer relationships that go with it.

“The MPF Original product has given Kish Bank an edge in our markets,” said Debra Weikel, Vice President/Mortgage Administration at Kish Bank in Reedsville, PA. “The competitive pricing, along with the ease of the process, makes this product a favorite of ours.”

Unlike the MPF Xtra^® product, the Original MPF product is credit enhanced. In other words, members earn fee income for accepting a portion of the credit risk on the loans they underwrite. The Original MPF product also includes a simple pricing structure that excludes delivery fees and loan level pricing adjustments.

In addition to the pricing and risk-sharing benefits, Kish Bank has also had a positive experience with FHLBank’s administration of the MPF Program. “The support we receive from the staff at FHLBank is customer service at its best,” said Weikel. “They are friendly, responsive and always willing to go the extra mile to help. Our partnership with FHLBank is a real success story for Kish Bank.”

With the additional credit enhancement fee income you can receive, you may want to take another look at the Original MPF product as a way to maximize your current mortgage business. You can retain your customers, share the risk and even add fee income to your mortgage business.

DISCLAIMER
The information presented is not investment or business advice, nor is it an offer to extend credit or buy any security or financial product. Readers must not rely on any of this information when making any investment, business or credit decision. FHLBank products are governed by various agreements between FHLBank and its customers, as well as certain FHLBank policies and applicable regulations. In the event of any inconsistencies between information contained in this article and such agreements, policies and regulations, the agreements, policies and regulations will be determinative.

“Mortgage Partnership Finance,” “MPF” and “MPF Xtra” are registered trademarks of the Federal Home Loan Bank of Chicago.