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MGIC Cuts Rates, Eases Underwriting Requirements

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Mortgage insurance premiums are being reduced at MGIC, while the mortgage insurance company is also loosening its underwriting guidelines.

Borrower-paid monthly premiums are being reduced by 5 basis points on home loans that exceed $625,500.

The lower premiums are effective for all loans regardless of the loan-to-value ratio, credit score or coverage segment.

The updates were outlined Monday in MGIC Bulletin No. 07-2013.

New borrower-paid monthly rates on fixed-rate mortgages will range from 0.23 percent for loans with LTV ratios between 80.01 percent, 12 percent coverage and 760 credit scores, to 1.05 percent for mortgages with 95.01 percent to 97 percent LTV ratios, 35 percent coverage and 760 or better credit scores.

The changes impact M.I. applications received on or after Dec. 2, subject to regulatory approval.

MGIC said it is also modifying credit score classifications for non-refundable borrower-paid and lender-paid single premiums and cutting most rates.

The maximum loan amount on an MGIC-insured loans is being raised to $850,000 from $750,000.

On loans above $625,500, the maximum debt-to-income ratio is being increased to 45 percent as long as the borrower has a credit score of at least 740.

The minimum credit score on loans in excess of $625,500 is being reduced to 720.

Finally, MGIC said that rate-term refinances will be eligible for insurance.

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