DEC 9, 2013 5:27pm ET

MGIC’s November Cures Outpace New Delinquencies

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Mortgage Guaranty Insurance Corp. had more cured loans than new notices of delinquency in November, atypical for this time of year when borrowers’ finances can get tight.

Normally, delinquencies increase this time of year because of holiday spending, S.A. Ibrahim, the CEO of competitor Radian Group noted in an interview a couple of months ago.

The mortgage insurer started the month with 109,629 loans in its inventory of delinquent loans. It received 8,012 new notices of delinquency in November.

However, 8,429 delinquent loans cured during the month. In addition, MGIC paid claims on 2,553 and rescinded or denied coverage on an additional 146 loans.

Furthermore, because of the settlement with Bank of America, another 1,846 loans originated by Countrywide were removed from the inventory. This brought the inventory down to 104,637 on Nov. 30. On the same day one year earlier, there were 143,153 loans in the delinquent inventory.

MGIC’s primary new insurance written during November was $2.2 billion, excluding Home Affordable Refinance Program loans. This is down from $2.4 billion in October, but similar to the NIW volume for November 2012.

Radian Guaranty had $3 billion of NIW in November, down from $3.5 billion in October and $3.84 billion in November 2012.

Its delinquent inventory started the month with 63,874 loans and the company received 4,501 new notices.

But cures took 3,793 loans out of the inventory along with paid claims on 1,747 loans. Radian denied or rescinded coverage on 279 loans, bringing the inventory to 62,556. One year prior it was at 92,770 loans.

Last week both MGIC and Radian got buy recommendations from Goldman Sachs.

The most recent data for the Mortgage Insurance Cos. of America, the trade group MGIC and Radian make up two-thirds of the membership, is for October. During the month, the group’s members did NIW of $8.7 billion, including HARP loans, down from September’s $9.6 billion and October 2012’s $11.5 billion.

However, the cure/default ratio was 93.9%, an improvement over 82.7% in September.

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