New MI Firm Hoping to Write Policies in 13
A new mortgage insurance firm started by former executives from The PMI Group hopes to begin writing policies early next year, according to officials close to the company.
Back in May the company, National Mortgage Insurance Corp., Emeryville, Calif., filed applications to insure loans with secondary market purchasers, Fannie Mae and Freddie Mac.
Those applications are now pending.
“It will probably take nine months to get all final approvals,” said one official close to the situation, requesting his name not be used.
The new mortgage insurance firm also has approvals pending in almost every state.
Bradley Shuster, who ran PMI’s international operations until the company sold its Australian unit to QBE Group in 2008, is the chairman, president and CEO of NMI Holdings Inc.
Glen Corso, who left PMI a few years back, is the company’s executive vice president and general counsel.
Corso said he could not discuss the company’s start up at this time. NMI has lined up roughly $550 million in backing.
So far, the company has not disclosed its investor base.
NMI is the second new MI firm to emerge in the past three years. The other is Essent Guaranty, which has backing from Goldman Sachs & Co.
These new firms are expected to thrive in the era of tight underwriting and loan standards. In short, they have no legacy claims to deal with and can start off with clean books of business.
To date, at least three MI firms have failed in the wake of the housing crisis, including PMI, which is in run-off mode.
These firms were hampered by disastrous books of business last decade, especially bulk deals which were poorly underwritten.
The nation’s largest MI in terms of policies-in-force, MGIC, continues to struggle. It recently posted a large loss for the second quarter and its share price trades for just over $1.