CHICAGO and MILL VALLEY, Calif., June 1, 2015 /PRNewswire/ -- The Mortgage Partnership Finance (MPF) Program and Redwood Trust, Inc. announced today higher loan limits for the MPF Direct product. The new single-family loan limit is $1.5 million, up from $729,750, and will take effect early in the third quarter of 2015.

"We are focused on helping FHLBank members that want to sell into the secondary mortgage market remain competitive," said John Stocchetti, Executive Vice President & Group Head, Mortgage Partnership Finance Program at the Federal Home Loan Bank of Chicago, which operates the MPF Program for the FHLBank 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."

The MPF Direct product allows members of a Federal Home Loan Bank that participate in the MPF Program to deliver eligible jumbo mortgage loans through the MPF Program's operational platform to a subsidiary of Redwood Trust. This arrangement adds private capital to the secondary mortgage market.

Brett Nicholas, President of Redwood Trust, said "MPF Direct was designed to provide additional mortgage liquidity to members of the Federal Home Loan Bank System and the increase in the loan limit further promotes the intended benefits to the members without adding credit or interest rate risk to their business."

The MPF Program also announced the following Federal Home Loan Banks have been approved by their regulator to offer the MPF Direct product: Atlanta, Boston, Chicago, and San Francisco.

About the MPF Program

To participate in the MPF Program, a financial institution must be a member of a Federal Home Loan Bank that offers the MPF Program. For more information, visit www.fhlbmpf.com.

The U.S. Congress created the FHLBank System in 1932 to promote housing finance. There are 11 Federal Home Loan Banks across the country; they are wholly owned by their member institutions and provide housing finance to more than 7,300 member commercial banks, savings institutions, insurance companies, and credit unions.

About Redwood Trust, Inc.

Redwood Trust is a publically traded company (NYSE: RWT), and together with its subsidiaries, focuses on investing in mortgage- and other real estate-related assets and engaging in residential and commercial mortgage banking activities. For tax purposes, Redwood Trust, Inc. is structured as a real estate investment trust. Neither Redwood Trust, Inc. nor any of its subsidiaries is a trust company, bank, or depository institution; and neither Redwood Trust, Inc. nor any of its subsidiaries is authorized to accept deposits or trust accounts.

For more information, please go to www.redwoodtrust.com.

"Mortgage Partnership Finance" and "MPF" are registered trademarks of the Federal Home Loan Bank of Chicago. The "MPF Mortgage Partnership Finance" logo is a trademark of the Federal Home Loan Bank of Chicago.

This press release contains forward-looking statements which are based upon our current expectations and speak only as of the date hereof. These statements may use forward-looking terms, such as "anticipates," "believes," "expects," "could," "plans," "estimates," "may," "should," "will," or their negatives or other variations on these terms. We caution that, by their nature, forward-looking statements involve risk or uncertainty, that actual results could differ materially from those expressed or implied in these forward-looking statements, and that actual events could affect the extent to which a particular objective, projection, estimate, or prediction is realized. These forward-looking statements involve risks and uncertainties including, but not limited to, implementation of the higher loan limit, availability of the MPF Direct product through other FHLBanks, and the risk factors set forth in the Federal Home Loan Bank of Chicago's periodic filings with the Securities and Exchange Commission, which are available on its website at www.fhlbc.com. We assume no obligation to update any forward-looking statements made in this press release.

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SOURCE Mortgage Partnership Finance Program