Industry News

Mortgage insurance auto-cancels after 5 years

Radian launches 'Free After Five'

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Radian Guaranty Inc. today launched a new mortgage insurance product that automatically cancels after five years. The product, dubbed "Free After Five," rewards borrowers with automatic cancellation of their monthly mortgage insurance payment and continues coverage for the lender until mortgage insurance is no longer needed. "Our goal is to help lenders manage their risk while meeting the demands of the market," said Roy J. Kasmar, president and COO of Radian Guaranty. "Home buyers are asking for mortgage products that are easy to use, and offer them added value. For borrowers with good credit, Free After Five is an excellent (mortgage insurance) option." The product comes partly in response to an increasing number of "piggyback" mortgage structures that combine different loans as a way to bypass traditional mortgage insurance, Kasmar said. About a quarter to a third of the mortgage insurance market has been impacted by such piggyback loan combination...