WASHINGTON, July 29 /PRNewswire-USNewswire/ -- Testifying before Congress today, Mortgage Insurance Companies of America (MICA) pledged to play a critical role in the future of housing finance by continuing to enable first-time and lower income families to purchase homes safely and soundly. Testifying on behalf of MICA was Patrick Sinks, President and COO of Mortgage Guaranty Insurance Corporation in Milwaukee, Wisconsin. Sinks discussed the role of private mortgage insurers during the financial crisis, stating that the industry has "weathered the storm," and is now able to "meet the expanded needs of first-time homebuyers seeking low downpayments on conventional mortgages." Sinks explained that, even in the wake of the nation's mortgage crisis, private mortgage companies are successful...
NEW YORK - Private mortgage insurance is making a comeback. Until six or eight months ago, private mortgage insurance was out of favor as people eager to get into the roaring housing market took adjustable-rate mortgages or "piggyback" loans or some other exotic form of financing. But as the market has cooled and lenders have tightened their standards, many people who want homes - especially first-time home buyers and those with little money for down payments - are choosing traditional fixed-rate mortgages backed by private mortgage insurance.
Many homeowners who have secured historically low interest rates on original purchases or refinancing during the past couple of years continue to look for ways to save money. And many lenders are happy to help them in an effort to keep their business going. But some homeowners do not know the details behind their mortgages that could either save them cash or cost them more on their investment over time. One area for a possible financial adjustment could come with Private Mortgage Insurance, which is applied to virtually every home loan where less than 20 percent has been put down on the mortgage. The PMI, while paid by the borrower, actually is there to protect the lender in case the new homeowner or refinance customer was to default on the loan.
Federal law preempts a lawsuit alleging that a mortgage servicer wrongfully refused to permit early cancellation of a homeowner's private mortgage insurance, a U.S. District Court in New York has ruled in granting a dismissal. The plaintiff was required to obtain private mortgage insurance (PMI) for a $214,000 residential mortgage.
By Phuong Cat Le Seattle Post-Intelligencer
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