Those Wiley Mortgage Insurers

Just imagine what a 10 basis point guarantee fee hike would do to the market for Fannie Mae and Freddie Mac loans. Well, apparently, the mortgage insurance industry has done quite a bit of imagining and has managed to get language added to the payroll tax bill that seeks parity between g-fee hikes for Fannie/Freddie, and GNMA. This coup by the MI industry is not surprising or unexpected, but it hammers home one thing we already knew: as the GSEs go, so goes private mortgage insurance. The darkest days of the MI industry are in the past (or so they hope), but it's hardly smooth sailing ahead. If there's one thing that elected officials like about private mortgage insurance it's this: it's private. No Uncle Sam, but ironically the sector's future hinges on Uncle which controls the GSEs. It's a complicated world we live in.