MI Company Essent Gets GSE Approvals

Essent Guaranty, the upstart mortgage insurer, has received approvals to write coverage for mortgages purchased by Fannie Mae and Freddie Mac, and hopes to issue its first MI policy early in the second quarter. Obtaining GSE approvals is essential for any new mortgage vendor because the two, today, account for roughly 70% of all originations. The MI industry currently boasts six active firms that write new policies. Triad Guaranty of Winston-Salem is in liquidation mode and recently sold its operating platform to Essent. One MI veteran, requesting his name not be used, called Essent's GSE approvals "a good development for all of us," adding that, "It shows this industry can attract fresh capital." Few MIs are earning money because of their "legacy" coverage, but observers note that Essent will have no such issues to deal with. Essent's management team includes former top executives from Radian Guaranty as well as Fannie Mae. National Mortgage News broke the story about the approvals Wednesday afternoon.