Prospective borrowers with high credit scores are getting a break from PMI Mortgage Insurance Co. In addition, borrowers with lower credit scores are being given access to programs with higher loan-to-values.
The Walnut Creek, Calif.-based company said in a bulletin that the changes reflect its goal of expanding homeownership in high LTV markets.
According to PMI, which claims that the new monthly rates are “among the lowest in the M.I. industry,” base premiums for borrowers with credit scores of at least 720 are being lowered. The change impacts loans with LTVs up to 95 percent.
On 95 percent LTV loans, the mortgage insurer said borrowers will save 11 basis points over existing pricing, while the savings works out to around 7 BPS on mortgage with LTVs up to 90 percent.
“When you compare our new pricing with FHA, you will find the all-in borrower execution even more compelling,” the bulletin stated.
The new rates go into effect on May 16.
PMI also said that borrowers will now be classified in one-of-three categories: 660 to 679, 680 to 719, and at least 720.
Another change has borrowers with credit scores of at least 660 eligible for 95 percent LTVs on one-unit properties. Borrowers with scores of at least 680 can finance two-unit properties up to 95 percent.
Just last month, PMI raised its maximum LTV to 95 percent on purchase-money mortgages in distressed markets. But that was only available to borrowers with scores of at least 720.
PMI additionally said in the latest notice that it will provide bigger discounts for borrowers with credit scores below 720 who choose amortizations of no more than 25 years. Rate-term refinances with 25-year terms or less will not be assessed any surcharge.
