Cracks are again appearing in the foundations of the private mortgage insurance business, as companies that insure home loans with down payments of less than 20 percent for Fannie Mae and Freddie Mac face rising claims and continue to struggle for market share against government-backed FHA and VA programs.

In 2008, the three biggest private mortgage insurers — MGIC Investment Corp., Radian Group Inc., and PMI Group Inc. — were all required to submit remediation plans to Fannie and Freddie after ratings agencies downgraded their financial strength ratings.

Today, all of the top private mortgage insurers continue to operate with financial strength ratings that are lower than once required by Fannie and Freddie, and several are struggling to meet minimum capital requirements imposed by state regulators.

Like the Federal Housing Administration (FHA), private mortgage insurers were hit hard by the housing downturn, as claims on bad loans chipped away at capital reserves.

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