Private mortgage insurers wrote coverage on $49 billion in mortgages during the second quarter, growing their market share to 36 percent — the highest level since 2008, according to a research report from the Royal Bank of Scotland.
Private mortgage insurers — who insure Fannie Mae and Freddie Mac against losses when borrowers put down less than 20 percent when purchasing or refinancing their homes — lost market share to FHA during the downturn, as FHA got the go-ahead from lawmakers to insure bigger loans for more affluent buyers.
FHA premium hikes and other tightening aimed at stemming losses and helping bring FHA market share back in line with historical levels have made private mortgage insurers more competitive. Legislation making its way through Congress could lead to further shrinkage in FHA’s book of business by requiring further premium hikes. Source: housingwire.com.
