GMAC Residential Funding Introduces 1st Lien Line of Credit; Helps Mortgage Lenders Maintain Origination Volumes in Changing Marketplace

Business Wire, Oct 25, 2004

MINNEAPOLIS -- GMAC Residential Funding today announced it is offering an interest only first lien line of credit with a unique blend of features that will help lenders maintain origination volumes despite rising interest rates.

"GMAC Residential Funding is driven by its commitment to delivering products that will create better value for our lender partners as well as homeowners," said Mike Kozlak, president of GMAC-RFC's Residential Capital Group. "We've met an increasing market demand for innovative products by giving borrowers more flexibility and convenient low payment options."

As a line of credit, this product provides a great deal of flexibility. Borrowers have a revolving, reusable line of credit with the ability to draw funds at any time and repayment options that fit their circumstances. There is no limit on what the funds can be used for - purchasing a property, a second home, a new car, college tuition, etc.

In developing the 1st lien line of credit, Kozlak said, "We have invested considerable time and energy in creating this 1st lien line of credit product to ensure that it best meets the needs of homeowners."

This product provides homeowners with a 25 year line of credit consisting of a generous 10-year interest-only (I/O) draw period followed by a 15-year amortized repayment period, purchase and rate term refi to 95 percent loan-to-value (LTV), and cash out to 85 percent LTV. Loan proceeds can be accessed by credit card or check.

Liz McGarry, Vice President, Guaranty Bank, said, "We are very excited about GMAC Residential Funding's first lien line of credit. This innovative product is an example of GMAC Residential Funding's commitment to keep its business partners competitive in a fast-changing market."

ABOUT GMAC RESIDENTIAL FUNDING

GMAC Residential Funding acquires residential mortgages and home equity loans and lines from mortgage banks and other lenders, securitizes and sells them as investments, and also provides a consistent source of warehouse financing for mortgage lending partners. GMAC Residential Funding is one of seven business units within GMAC-RFC's Residential Capital Group. GMAC-RFC, a wholly owned subsidiary of GMAC Financial Services, is a leading private issuer of mortgage-backed securities and the No. 1 warehouse lender in the United States. The company leverages its strengths in securitization, lending and investment to offer a broad portfolio of innovative capital solutions to businesses in a variety of markets. The company operates in the United States, Canada, Mexico, United Kingdom and Continental Europe. www.gmacrfc.com