Industry NewsMortgage

Mortgage insurers won’t stand in the way of Fannie and Freddie short sales

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Starting tomorrow, mortgage giants Fannie Mae and Freddie Mac have a green light from nine private mortgage insurers to approve short sales for distressed borrowers without a separate review.Fannie and Freddie require that borrowers take out mortgage insurance if they are making down payments of less than 20 percent of the value of the home they are financing. Letting loan servicers working for Fannie and Freddie approve short sales and deeds in lieu of foreclosure without a separate review by mortgage insurers has the potential to reduce costs, delays and uncertainty, Freddie Mac said in announcing the move.The nine mortgage insurers that have agreed to expedite short sales are CMG Mortgage Insurance Co., Essent Guaranty Inc., Genworth Mortgage Insurance Corp., Mortgage Guaranty Insurance Corp., PMI Mortgage Insurance Co., Radian Guaranty Inc., Republic Mortgage Insurance Co., Triad Guaranty Insurance Corp., and United Guaranty Corp.In announcing the new agreement, Fannie Mae said it ...