Walnut Creek, California-based ""PMI Mortgage Insurance Co."":http://www.pmi-us.com announced on Thursday that it has expanded the company's Refinance-to-Modification (RTM) program. The program can now be used with all PMI-insured loans, not just those loans owned or guaranteed by Fannie Mae and Freddie Mac that are eligible for the federal government's Home Affordable Refinance Program (HARP).
Under the RTM program, the PMI coverage percentage and premium rate remain the same and the existing insurance certificate is modified to cover the new refinanced loan. To minimize borrower expenses associated with this process, PMI will not charge fees to modify the existing insurance certificate.
PMI's modification of the existing insurance allows coverage to be extended to the new refinanced loan -- even though the property value may be lower than when the original loan was insured and may not be eligible for mortgage insurance coverage today. By allowing modification of the insurance on a borrower's loan, regardless of investor or servicer, the company says its approach will facilitate refinances for more homeowners caught in the housing crisis.
Chris Hovey, PMI's VP of servicing operations, said, ""PMI is working closely with mortgage servicers and the GSEs to keep borrowers in their homes, supporting numerous housing and foreclosure prevention initiatives. Providing consistent solutions across all of our insured loans helps investors accelerate refinancing to lower monthly payments, or otherwise improve the position, of all borrowers who have PMI insured loans.""
To be eligible for the streamlined insurance modification under PMI's RTM program, the borrower must be current on their existing loan and the new loan should improve the borrower's financial position by at least one of the following: a reduction in the mortgage payment, interest rate, or principal balance; an extension of the fixed-payment period on an adjustable-rate mortgage (ARM); an extension of the loan or amortization term; or a more stable payment product.
PMI has also implemented other initiatives to support borrowers, lenders, and servicers in their efforts to avoid unnecessary foreclosures. The company has launched a new Web site section called """"Home to Stay"":http://www.pmi-us.com/homeownership/index.html,"" which provides lenders, servicers, and homeowners with information on home retention assistance, such as the Treasury's Making Home Affordable programs. The company is also behind a nationwide radio public service announcement, promoting foreclosure alternatives and directing borrowers to HUD-qualified resources for help.