Might provide an alternative I’ll need someday.

Thanks for the heads up. I’ve searched their PMI’s website, but see no list of lenders that are cut off. We’ll probably receive notices from various lenders about the availability of PMI next week, or changes, as they line up new PMI coverage.

For the benefit of readers, loan originators (with brokers) do not select private mortgage insurance companies for their clients. That kind of arrangement happens at lender level. LO’s are generally aware of the guidelines for PMI companies, and costs to the borrower, available from pricing engines on their respective websites.

It’s been a while since I’ve used PMI on a loan that I have originated, mostly because it wasn’t needed, or if needed, made more sense as an FHA loan, which does not have “private” mortgage insurance, but does have FHA mortgage insurance.

Still, losing options to offer clients is never good.

The MI companies (MGIC, PMI and Radian) almost cratered on the stock market this year (losing nearly 90% of their stock value they had 2 years ago), but they have rebounded a bit since March. I don’t think I’d buy their stock right now.

Perhaps they made their decision on which banks to suspend based on who would agree to loan them money in a pinch?

From PMI:

“As a result of the ongoing instability in the marketplace, the mortgage insurance industry is still facing severe capacity constraints and must take continued steps to manage the volume of new insurance commitments from a risk and capital standpoint…and PMI’s current capacity limitations.”

As this post notes, they all ready reduced their client load greatly by canning mortgage brokers months ago. I cannot imagine what all the private mortgage insurance companies are going through considering all the defaults…although at the time they probably cursed the piggy-back mortgages for cutting into their pie, they must be thanking their lucky stars since that reduced some of their exposure to this current climate.

1) check w/your loan originator asap to make sure the private mortgage insurance company is acceptable w/the lender they are utilizing for your mortgage.
2) make sure your loan originator works for a company that is a HUD approved FHA lender as a back up plan in case private mortgage insurance becomes an issue w/your mortgage.

It seems that any loans with private mortgage insurance these days are really very challenging. FHA has been better to work with (in general).

I should have been clearer.

I entirely agree with you and Cathy, that higher standards in the mortgage broker industry were, and are, necessary. I have supported those efforts with letters and phone calls to elected representatives, and countless hours of typing at RCG, and anywhere else I think intelligent, compassionate people will listen.

However, if the large competitors of small businesses (again, banks vs brokers) succeed in eliminating, or marginalizing the small businesses, by outspending them in PR and lobbying efforts, all the efforts to raise the professional standards for mortgage brokers will be for nothing, as the brokers will be gone, or only left to fight over table scraps.

I do not doubt that NAMB wasted a lot of time and money picking the wrong battles to fight. My recollection is that they DID support a national registration, licensing and continuing education system, and I’m sure I could find evidence of that, just as I am equally sure that you could find earlier evidence that they opposed it.

I am also fairly sure that banks opposed requiring that their loan originators participate in such, as they are NOT currently required to.

The frustrating thing for me is how little I can effect the outcome of these battles, and worse, how few of my peers are aware of these battles, and choose to join in the the fight for survival. Many switch sides, depending which way the battle turns, or as their awareness of the issues at hand grows.

I’m doing all I can do to survive, and continue serving those who have placed their trust in me. I believe I owe that effort to my clients, my family and myself.

Surely, you must understand how politics and busniess work together, and it is NOT pretty, nor just.

Brokers and other small businesses are woefully outmanned and outspent by large businesses in these battles.

THAT was my point.

I don’t understand why you don’t “get it” except for that you’ve never worked for a mortgage broker or correspondent lender. If my memory serves, you’ve only worked on the bank side.

Shirking of responsibility?

How many times do I need to repeat this (or have you all ready tuned this out):

~Banks created the many of the mortgage products/programs

~Banks hire Account Executives/Reps to call on mortgage brokers. They train brokers on the products and tell them how to “make them work” for the consumer so that mortgage brokers send more loans back to the bank.

~Banks underwrite the transactions. They’re not underwritten by the broker. The bank can reject any loan the broker sends their way….

~Banks fund the loan from the mortgage broker.

Mortgage brokers were just the sales force for the bank/lenders.