Underwriting requirements for loan-to-value ratios, credit scores and loan amounts were all expanded at United Guaranty Corp.
The Greensboro, N.C.-based firm issued a bulletin indicating that enhancements to requirements for its Performance Premium program combines general underwriting requirements with automated risk tools.
Loans that are not currently eligible for mortgage insurance coverage might now qualify.
United Guaranty said that expanded areas of eligibility include loan amounts, loan-to-value ratios and credit scores.
Six separate underwriting grids will be reduced to two “concise grids that provide general eligibility for all loans types and GQX markets.”
On a $417,000 fixed-rate mortgage originated by a mortgage broker, a borrower with a 680 credit score can qualify for a 97 percent LTV on an owner-occupied single-family property. The score drops to 620 on full-file submissions.
With a 660 score and a 95 percent LTV, the loan amount can increase to $625,500. The lower 620 score is available on full-file submissions.
An owner-occupied duplex can qualify for a 95 percent LTV on loans up to $625,500 with a score as low as 660 on a full-file submissions, and owner-occupied three- and four-unit properties can qualify or 90 percent LTV.
Requirements on adjustable-rate mortgages are more rigid.
Mortgage insurance applications received after Feb. 12 will utilize the expanded requirements.
United Guaranty explained that the enhancements don’t change its “secure quote feature” or the five-point debt-to-income ratio and 10-point credit-score variances on the performance premium for which the debt-to-income ratio cannot be greater than 50 percent or the credit score lower than 620.
The mortgage insurer expects to transition the Performance Premium changes into its systems by the middle of May.
In a separate bulletin, United Guaranty said it is updating Performance Premium single-premium pricing to combine borrower-paid and lender-paid premiums into one plan.
“As with most of our pricing updates, some loans will have lower premium rates, and some will have higher premium rates,” the bulletin stated. “You’ll find that we continue to offer better pricing for your lower-risk loans — and for most loans, our prices remain lower than our competitors.”
Updates to United Guaranty’s Geographic Quality Index included improvements to 10 markets and deterioration in 18 markets.
