Loan officers create tool to obtain rates from all six MIs

Looking to fill a void in both transparency and convenience in obtaining private mortgage insurance quotes, a pair of loan officers from the Kansas City, Mo., area created a comparison shopping tool.

PMI Rate Pro allows loan officers to access pricing results from all six PMI companies "black box" risk-based pricing systems in seconds.

The company's founders are Nomi Smith, a loan officer with Fairway Independent Mortgage, and Luke Landau, mortgage sales leader with Guardian Mortgage.

"Consumers are looking for transparency and they're looking at the most affordable payment that works for them," said Smith. "We wanted to create something that was easy to use, that would give us what we need quickly and also give us different options on PMI views, not just monthly [premium policies] but single as well."

It adds another way for loan officers to differentiate themselves from the competition.

"To be able to sell PMI effectively to a client is now part of the selling game," Landau said. "From a loan officer's perspective, the system is extremely valuable because it has all of the PMI companies at the same time. It is a very quick process, while you're on the phone with the client or in front of the client."

PMI Rate Pro connects the loan officers to each MI company's site simultaneously. They're able to run quotes directly all in a matter of seconds, instead of having to go to each site separately.

Typically, the average loan officer gets quotes from one-to-two mortgage insurance companies, the PMI Rate Pro founders said. Some of this is rooted in the master policies the mortgage originator they work has with the various PMI companies; most lenders use just three counterparties. Diversification of risk is another concern.

Yet by being able to eyeball rate quotes from all the players, the product, available since October, is expanding the universe of potential counterparties for the smaller originator who might now want to sign up with a mortgage insurer they currently don't do business with.

"What we find is that we brought value across the board, a lot of the lenders that we work with are now credentialed and have policies with PMI companies that they did not use before us, just because they see that the rates have been more effective for them," Landau said.

Private mortgage insurer market share has been volatile since all six companies finally adopted black box pricing over a year ago.

Right now the only product comparison PMI Rate Pro does is single premium versus monthly, but other options are in the works.

The developers are talking with the mortgage insurers regarding application programming interfaces with their systems, with the connections currently through the individual websites.

They are also in negotiations with lenders of all sizes, although the product's primary users might be the smaller originators.

While this is the first effort that looks to bring all the PMI companies into one system, in April of 2018, Cloudvirga came out with a tool that allows loan officers to submit applications to the Freddie Mac and Fannie Mae automated underwriting systems at the same time to determine where they could get better pricing.

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