Mortgage Insurance Companies Loosen Their Belts!

Mortgage Insurance Companies Are Starting To Loosen Their Belts!

It appears the Mortgage Insurance companies want to start competing for your business. This is great news for home buyers and people looking to refinance that still don’t have the 20% equity. It also means that someone who is looking to take a little extra cash out of their home to pay some bills off might have a viable option. As of 2/21/2011, MGIC (Mortgage Guaranty Insurance Corporation) whom is a large contributor to the Mortgage Insurance arena, is now allowing borrowers to meet there 3% minimum contribution for a home purchase to be satisfied by a gift or a grant. There are obviously some restrictions to this but a first time homebuyer might be able to buy that dream house with a gift from their parents, and without any or a minimal amount of their own funds. This is a big step. Prior to this announcement FHA was the only program allowing anything similar. UG (United Guaranty) another big partner in the Mortgage Insurance arena is also loosening up there guidelines. They are reducing the minimum credit score requirements on many of their products. They are also increasing the amount of equity you need for a cash out refinance, which means you have the potential to get more cash out of your home to pay some of those bills off. UG is also loosing there guidelines on 3-4 unit properties, second homes, and investment properties. This is great news following FHA/HUD's announcement that they are increasing their costs. Ultimately it gives all of us more options. More options result in more competition for your business. I strongly recommend if you have been on the fence about refinancing to start getting serious. The programs are still reasonable, and the rates are close to their bottom. As the economy recovers you can expect rates to go up.