Wells Fargo & Co. (WFC), as of this week, has suspended non-conforming mortgage product offerings through its wholesale channel, due to "low market demand and higher risks," according to a statement from the banking giant Thursday. The decision is temporary, the bank said, although it wouldn't specify when it might resume future jumbo wholesale funding. "Wells Fargo has long been the nation’s No. 1 retail mortgage lender and a leading third-party lender because we assess and respond to evolving market trends in a proactive, judicious manner," a statement to the press said. "This includes continuously reviewing our real estate lending product mix and underwriting  practices to ensure they prudently align with marketplace risk." Risk is indeed on the rise amid continued housing turmoil. In some ways, it's not surprising that Wells is pulling back on warehouse funding -- many of its competitors, including Bank of America Corp. (BAC), have exited the channel altogether. But the decision to exit jumbo warehouse funding underscores the dearth of non-conforming mortgage funding now available in the mortgage market, particularly for third-party originators that rely on the wholesale origination channel. For would-be non-conforming borrowers, the lack of funding options is likely to be a larger problem now than at the end of last year. Effective Jan. 1, 2009, Fannie Mae (FNM) and Freddie Mac (FRE) saw their conforming limit in certain high-cost local markets dropped to $625,500 via the terms of the Emergency Economic Stimulus Act of 2008; the high-cost nonconforming limit had temporarily been boosted to $729,750 through the end of last year by other, earlier legislation. That's not to say all jumbo funding is disappearing, even at Wells Fargo. A spokesman for the bank stressed that the decision to exit jumbo funding was limited to wholesale channels, and did not affect correspondent or retail origination channels; the program change also won't affect staffing levels, the spokesman said. All of which means consumers in the jumbo mortgage market will want to work with a more direct lender in assessing their mortgage options. But that sort of new reality likely comes as little comfort to a dwindling number of brokers in the market. Write to Kelly Curran at kelly.curran@housingwire.com. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.