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06/13/2011

Radian "PowerPak" Combines New Program, Rate Changes and Expanded Eligibility to Help Customers Generate Increased Volume

Company Introduces One Underwrite(TM), Lowers BPMI Rates and Expands Jumbo Loan Program

PHILADELPHIA, Jun 13, 2011 (BUSINESS WIRE) --

Radian Guaranty Inc., the mortgage insurance (MI) subsidiary of Radian Group Inc. (NYSE: RDN), announced today it is implementing a series of changes to its guidelines and rates that will be applicable for all MI applications received on or after July 11, 2011. As part of the Radian "PowerPak," the company has introduced the One Underwrite program, lowered borrower-paid (BPMI) rates and expanded its Non-Agency Jumbo Loan program.

The new One Underwrite program further aligns Radian MI eligibility with Fannie Mae Desktop Underwriter (DU) and Freddie Mac Loan Prospector (LP) approval recommendations, eliminating the concept of a double underwrite for MI eligibility. With the program, Radian's customers can now qualify loans for buyers with FICO scores down to 620 for Radian MI with an Approve/Eligible or Accept/Eligible recommendation from DU or LP and only five underwriting overlays, details of which are available on Radian's website at www.radian.biz/rates.

Radian also made changes to its rates, which will increase affordability for buyers with low downpayments and expand eligibility for those with lower FICO scores. The rate changes, which are subject to regulatory approval, include:

  • The lowering of BPMI monthly standard coverage rates for loans with loan-to-values (LTVs) to 95% and FICO scores of 720 and higher by an average of 14 basis points.
  • The expansion of BPMI and lender-paid (LPMI) monthly rates to include loans with a minimum FICO score of 620, to coincide with the launch of the One Underwrite program.

In addition to offering the One Underwrite program and lower BPMI rates, Radian also announced changes to its Non-Agency Jumbo Loan program. With the reduction in the government-sponsored enterprises (GSEs) and the Federal Housing Administration (FHA) loan limits scheduled for later this year, having Radian's jumbo coverage available at the following static maximum loan amounts will be especially helpful to lenders:

  • $650,000 for loans with LTVs of 85.01% - 90%
  • $750,000 for loans with LTVs of 80.01% - 85%

Additional changes to Radian's Non-Agency Jumbo Loan program include lowering the minimum FICO score from 760 to 720 and the elimination of the restriction of charter minimum coverage. Radian will continue to offer coverage on conforming jumbo loans to the current GSE high cost limits.

"The introduction of our new 'PowerPak' makes it clear that Radian is committed to being the MI provider of choice for our lending partners - one dedicated to making MI more easily fit into their lending processes, while giving our partners programs and pricing to help them compete and generate volume in this still challenging market," said Brien McMahon, chief franchise officer at Radian.

"With the recent and further planned changes to FHA, Radian is stepping up with our 'PowerPak' and proving conventional financing with Radian MI is a better alternative to the FHA for low-downpayment borrowers," added Mr. McMahon.

Radian Group Inc. (NYSE: RDN), headquartered in Philadelphia, provides private mortgage insurance and related risk management products and services to mortgage lenders nationwide through its principal operating subsidiary, Radian Guaranty Inc. These services help promote and preserve homeownership opportunities for homebuyers, while protecting lenders from default-related losses on residential first mortgages and facilitating the sale of low-downpayment mortgages in the secondary market. Additional information may be found at www.radian.com.

SOURCE: Radian Guaranty Inc. 

Radian Guaranty Inc.
Emily Riley, 215.231.1035
emily.riley@radian.com