These numbers I pay attention to:
Please note that they have grown loans pretty aggressively.
This growth should suppress the relative number (percentage) of loans in
default (it takes time to default). Also this happened with houses still appreciating.
I agree that if RE keep appreciating MI companies will be fine.
But if you consider a case where RE falters...
...............................................December 31 December 31
............................................... 2003 2002
Direct primary insurance in force
($millions) 119,887 110,273
Direct primary risk in force
($millions) 27,106 26,273
GSE pool risk in force ($millions) 1,393 1,218
Total pool risk in force ($millions) 2,415 1,732
Other risk in force ($millions) 1,053 463
Primary insurance:
Prime
Number of insured loans 640,778 698,910
Number of loans in default 22,156 21,483
Percentage of loans in default 3.46% 3.07%
Non-prime
Alt A
Number of insured loans 138,571 102,839
Number of loans in default 7,343 5,300
Percentage of loans in default 5.30% 5.15%
A minus and below
Number of insured loans 110,054 79,871
Number of loans in default 12,497 9,005
Percentage of loans in default 11.36% 11.27%
Total prime and non-prime
Number of insured loans 889,403 881,620
Number of loans in default 41,996 35,788
Percentage of loans in default 4.72% 4.06% |
