I've written several posts recently on this blog and on others about the state of the economy and the credit crunch that we are all experiencing. The credit crunch is having a huge impact on the mortgage industry. The majority of PMI companies have restricted PMI all together for borrowers with a credit score under 620.
        It is becoming very difficult to provide conventional real estate financing for borrowers whose scores are below 620 even if they have a down payment. I have a client whom is shopping for a home, she thinks that she has one picked out and is going to see it today. She is a great borrower with stellar credit and she has fallen victim to this flagging economy.
        She was laid off from her great job with Morgan Stanley who reportedly will be laying off even more people. Originally we were going to put the financing of the home and the home in her name alone. She is married and her hubby's credit score is not so great, well under the 620 benchmark that MGIC set a couple of months ago.
        I knew that I could get the file approved (DU), I just did not know if I would be able to get the file cleared and closed. There are several more restrictions scheduled to rear their ugly head on March 17th. Most companies will be following MGIC's lead and restricting 100% financing for those with a 680 credit score or better.
        I shopped around for about an hour, I checked the guides on every PMI issuer I could think of. Finally I came across Genworth Financial. I should mention at this point that my client does have a 10% down payment.
        I ran the scenario through Genworth financial's on line "Mortgage Insurance Calculator" and was pleased to see that the premium is around $200.00 less per month than that of MGIC's for the same scenario and it was approved.
        I called Genworth to find out if it would work, and inquired about any changes that may be coming into effect March 17th. They looked at my scenario and said that the changes will be taking place for declining market areas and that I will be fine. This is great news, because I really thought that I was not be able to get the PMI condition satisfied. If you are a mortgage professional in the same situation check out Genworth Financial, just make sure that the lender you take it to will accept their PMI.
        If you are a person in need of real estate financing and have been told no because of similar or related issues please feel free to give me a call. I may not be able to help you, but I will put in the effort and look in places that other people may not have thought to.


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Thanks for reading and stay tuned!