Philadelphia-based Radian Group, a real estate loan insurer, has completed a transaction that will help it manage risk on non-prime mortgage loans, which generally go to people who are riskier because they don’t qualify for prime loans under normal terms.

Radian completed its second structured finance transaction with Smart Home Reinsurance 2005-1 Limited. The transaction was created and funded through the sale of $98.5 million of credit-linked notes backed by a $1.68 billion pool of Radian-insured Alt-A mortgage loans.

The transaction better positions Radian to insure loans to people who don’t qualify for prime loans under normal terms.

The Smart Home transaction allows transfer of the risk to Smart Home, which gives Radian more capacity to work with other lenders in the non-prime market. Lenders now have a better ability to operate in the non-prime market, according to David Cheung, a Radian spokesman.

“The non-prime segment of the mortgage insurance market is profitable, but it also requires a disciplined approach to risk management,” said Roy Kramer, president and chief operating officer of Radian, in a statement.

In late January, Radian reported that its fourth-quarter net income skyrocketed to $156 million, or $1.62 per share, up 181 percent from fourth-quarter 2003 when its income was $55.5 million, or $.57 per share.

Radian is a credit enhancement provider to the global financial and capital markets. Radian’s subsidiaries provide products and services through three business lines: financial guaranty, mortgage insurance and other financial services.

***

Send tips or a Letter to the Editor to janis@inman.com or call (510) 658-9252, ext. 140.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×