Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: MulhollandDrive who wrote (104120)	2/8/2008 5:38:49 PM
From: MulhollandDrive	Read Replies (2) \| Respond to of 306849

not sure if this was posted yesterday... MGIC Says Sales May Fall as It Seeks to Reduce Losses (Update3) By Andrew Frye and Erik Holm Feb. 7 (Bloomberg) -- MGIC Investment Corp., the largest U.S. mortgage insurer, is scaling back coverage in California, Florida, Arizona and Nevada to reduce losses on loans. MGIC will offer fewer policies to homebuyers who don't have top credit scores, the Milwaukee-based company said today in a regulatory filing. The insurer will also tighten standards in parts of 14 other states. MGIC, which reimburses lenders when borrowers don't repay debts, is trying to recover from its first quarterly loss amid the worst U.S. housing slump in 25 years. Homebuyers in the affected markets won't get coverage if they borrow more than 95 percent of a property's value. Nevada has the highest foreclosure rate, followed by Florida, according to RealtyTrac Inc., a seller of foreclosure data. California ranks fourth. ``It's a matter of them being reluctant to take the risk in this environment where you have declining real estate values,' said Michael Grasher, an analyst at Piper Jaffray & Co. in Chicago. Lower home values make it harder for lenders to recover the full amount of their loans when borrowers default. In the high-risk areas, MGIC will no longer back so-called Alt-A mortgages where borrowers don't provide full documentation. It also won't insure mortgages on condominiums for more than 90 percent of their value. New York, Michigan MGIC is also reducing coverage in parts of New York, including Long Island. In Michigan, which had the third-highest foreclosure rate, the company is reducing business in the Detroit area. ``These changes will negatively impact MGIC's volume of new insurance written,' the insurer said in the filing. The insurer advanced 38 cents, or 2.5 percent, or $15.74 at 10:11 a.m. in New York Stock Exchange composite trading. It has declined about 77 percent in the past year. The company was put on ``CreditWatch' by Standard & Poor's on Jan. 24 after saying fourth-quarter losses jumped sevenfold. Final results for the quarter and 2007 are scheduled to be announced Feb. 13. MGIC last year cut its quarterly dividend by 90 percent. Mortgage insurers' sales have been climbing industrywide as lenders require more borrowers to buy the coverage. Members of the Washington-based Mortgage Insurance Companies of America, including MGIC, wrote 141,588 policies for homeowners in December, up 57 percent from a year earlier. Late Payments The number of insured borrowers falling more than 60 days late on payments jumped to a record 64,384 in the month from 46,921 in December 2006, according to the group, which includes six of the top seven U.S. mortgage insurers. Home foreclosures in the U.S. rose to 215,749 in December, a 97 percent increase from the year-earlier month, according to Irvine, California-based RealtyTrac. A total of 3.4 percent of households went into foreclosure in Nevada last year, a rate that led the nation. California, the country's most populous state, had the highest total number of foreclosures, at 481,392, while Florida was No. 2 in both number and percentage of foreclosures. To contact the reporter on this story: Andrew Frye in New York at afrye@bloomberg.net Erik Holm in New York at eholm2@bloomberg.net . Last Updated: February 7, 2008 10:52 EST

To: MulhollandDrive who wrote (104120)	2/8/2008 7:22:00 PM
From: Jim Fleming	Read Replies (1) \| Respond to of 306849

Mulholland re contract terms discussion I am reminded of an experience I had as the broker in the sale of a significant batch of seasoned FHA/VA loans by a thrift insurance fund to a midwest insurance company. After the usual due diligence visit the insurance company sent me the standard documentation we used on such deals for the principal at the fund to sign. I brought the papers over and requested the signature. This guy spent some time reading the stuff and then pulled a red crayon out of his desk draw and Xed out four or five pages of legalese and then wrote a sentence or two of plain English making the deal absolutely non-recourse. He then looked at me and smiled and said "I went to law school too, if they want the loans this is the documentation I will sign." To my amazement and education the deal went through without a problem. Jim