Mortgage Insurers Help Foreclosed House Prevention Program

The nation’s mortgage insurance companies have been helping accelerate the progress of the Obama administration’s foreclosed house prevention program, according to Kevin Schneider, head of the Mortgage Insurance Companies of America.

Schneider said mortgage insurance companies have already helped nearly 100,000 mortgage borrowers save their houses from getting added to repossessed properties inventories. He said the total value of mortgages saved was almost $18 billion.

The mortgage industry chief also said that his group has assisted in the development of procedures and systems meant to facilitate the implementation of the Home Affordable Refinance Program and the Home Affordable Modification Program.

He admitted that although the initial numbers of home loans modified or refinanced under HARP and HAMP are not as high as expected, he reiterated that the program is progressing.

Since the launch of the foreclosure homes prevention program several months ago, the mortgage industry association MICA has been working with Fannie Mae, Freddie Mac and mortgage servicers in modifying or refinancing distressed mortgage loans under the HAMP and HARP initiatives.

Additionally, mortgage insurance firms have crafted standardized reporting procedures and underwriting systems to enable troubled borrowers have a second chance if their initial applications have been rejected by mortgage lenders under the HAMP initiative.

Schneider reiterated that mortgage insurance companies need to work closely with the mortgage finance industry in order to restore and maintain stability in the housing market. He said mortgage insurance firms have been working with government agencies, investors, lenders, credit counselors to refinance or modify loans to enable borrowers to reduce their more affordable monthly payments.

MICA executive vice president Suzanne Hutchinson said mortgage insurance firms will continue to help work out loan modifications and loan refinancing in the coming weeks and months under the foreclosed house prevention program.

Additionally, MICA members also said that premiums for private mortgage insurance policies have been made tax deductible for taxpayers refinancing a loan or buying a home.

The members have also implemented the revised guidelines that expanded the foreclosed house prevention program. They have improved their systems to incorporate the increase of the refinancing loan-value ratio from 105 percent to 125 percent under the HARP initiative. This expansion has increased the number of borrowers qualified to apply for loan refinancing.

All in all, according to the MICA president, the mortgage insurance companies that comprise MICA have helped almost one million homeowners save their homes from getting added to foreclosed house lists since last year.

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