The latest influx of mortgage insurance-related activity includes policy updates and extensions, coverage expansion and new business relationships. Also emanating from the industry were new service offerings and even an international mortgage insurance company acquisition.
Congress passed the American Taxpayer Relief Act of 2012 on Jan. 2 and gave eligible homeowners a Dec. 31, 2013, extension on the mortgage insurance tax deduction, according to the Mortgage Insurance Companies of America.
With a Dec. 31, 2011, retroactive date, this tax break goes to homeowners with qualified personal residences and an adjusted gross income under $100,000. Homeowners over the $100,000 income mark may still be able to use this deduction, which phases out by 10 percent for each $1,000 over $100,000.
“This positive development will sustain home affordability for low- and moderate-income homebuyers who are assisted by private capital, in the form of private mortgage insurance,” MICA President Teresa Bryce Bazemore said. “This preservation of tax policy parity is essential for the continued recovery of the residential housing market.”
In Bulletin No. 2013-3, Freddie Mac noted several servicing requirements updates and revisions such as changes to the Single-Family Seller/Servicer Guide. Among the guide updates, Section 70.10 was revised to reflect current Freddie requirements for mortgage insurance claims that were reduced, suspended or denied. Effective Jan. 1, the requirements include Freddie sending letters to servicers. providing a suggested remedy and allowing 60 days for servicer action.
Philadelphia-based Radian Group Inc.’s announced its insurance subsidiary Radian Asset Assurance, Inc. finished its $52.4 million settlement payment to Financial Guaranty Insurance Company for reinsurance risk on Jan. 9. According to the company’s media statement, the payment will not impact Radian Group’s financial statements.
On Dec. 20, 2012, Freddie granted a one-year extended approval of Radian Mortgage Assurance Inc. as a limited, eligible mortgage insurance provider. This status will expire Dec. 31, 2013, according to the company’s statement. This extension also gives Radian Mortgage Assurance approval to write business in Idaho as long as the company keeps trying to get a waiver of approval or denial from state-level insurance regulators.
“Our top priority at Radian is to continue writing new, high-quality mortgage insurance business,” Radian Mortgage Assurance Chief Executive Officer S.A. Ibrahim said. “The support of our stakeholders is critical to this effort and the extension of Freddie Mac’s approval of Radian Mortgage Assurance is an illustration of that support.”
MGIC Investment Corp. announced that its Dec. 3 transmission of $100 million to its principal subsidiary Mortgage Guaranty Insurance Corp. would complete the list of Freddie’s conditions for approving MGIC Indemnity Corp. as a limited mortgage insurance provider until. Dec. 31, 2013. In the same statement, Mortgage Guaranty noted entry into its settlement agreement with Freddie. As part of this previously headlined agreement, Mortgage Guaranty will pay $267.5 million to settle a pool insurance dispute.
Policy-related activity aside, some private mortgage insurers have highlighted products and partnerships for increased productivity and securing those precious homeowner dollars.
Richmond, Va.-based Genworth U.S. Mortgage Insurance, in March, unveiled an upgraded mortgage insurance rates and comparisons tool for loan processors. Users must fill out only five required field to access Genworth insurance rates or get a quote.
Mortgage technology and services provider Lender Processing Services Inc. also featured a March launch of new mortgage insurance products in its LPS Loan Quality Gateway. LPS customers can access insurance products through the LPS system and order rate quotes, eligibility and rate quote checks and mortgage insurance certificates.
United Guaranty revised its Performance Premium RAP underwriting requirements to reflect changes to reserves and acreage. Effective Feb. 11, the company updated its Geographic Quality Index. The update showed 69 improved markets and 8 worsened markets, according to the company’s statement.
Lenders will have access to Essent Guaranty Inc.’s mortgage insurance rates and eligibility requirements through LoanSifter as a result of a partnership established in January. Using LoanSifter’s mortgage insurance best execution pricing platform, users can give borrowers mortgage insurance comparison and estimates.
National Mortgage Insurance Corp. said it received New York-state approval for writing insurance. The Jan. company update listed the company as licensed in 22 states plus the Washington, D.C.
This round of mortgage insurance-related reports ends in the Caribbean.
Bermuda-based Arch Capital Group Ltd. announced Feb. 8 that its U.S. based subsidiary Arch U.S. MI would acquire CMG Mortgage Insurance Co. from PMI Mortgage Insurance Co. and CUNA Mutual Group. As well, Arch will take over PMI Mortgage’s insurance operating platform and assets related to the platform. With this transaction, Arch Capital will gain a segue into the U.S. mortgage insurance market.
“We are extremely pleased to be able to provide a strong source of private capital to a U.S. mortgage insurance market in great need of capacity, subject to obtaining all required approvals,” Arch Capital’s Chairman and CEO Constantine Iordanou said. “The new operation will complement our existing European Union-based mortgage insurance and global reinsurance operations, providing us with a platform to participate in mortgage insurance and reinsurance business on a worldwide basis.”
