Lender-paid mortgage insurance could see an increase in share as fees for this product do not count towards the qualified mortgage 3% test, one of the larger underwriters of this product says.

With the upcoming implementation of QM, lender-paid mortgage insurance offers lenders more flexibility because the cost of coverage is built into the loan interest rate and is not counted in the points and fees cap, says a spokesman for United Guaranty Corp., one of the companies believed to be the top originators of this product.

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