New restrictions on mortgage insurance
If you read Sunday's story about the housing market, you know that mortgage lenders are increasingly requiring bigger down payments in markets they consider "soft" or "declining" -- Baltimore among them. Some lenders have compiled lists.
The Baltimore metro area is on another sort of list now: a mortgage insurer's.
Mortgage Guaranty Insurance Corp., best known as MGIC, says mortgage insurance applicants in the metro area and every other market on its "Restricted Markets" list must abide by a variety of new rules as of March 3, including:
--No loans above 95 percent of the home's value
--No loan-to-value between 90.01 and 95 percent without a minimum credit score of 680
--No loan-to-value more than 90 percent for condos
--No cash-out refinances
--No investment property loans
Besides Baltimore, there are 25 metro areas on the list -- including Washington -- plus the entire states of Arizona, California, Florida and Nevada.
In determining whether to place a market on the restricted markets list, MGIC uses both external and internal information sources including OFHEO Home Price Indices, National Association of Realtors change in median home prices, Moody’s Ecomony.com home price projections and MGIC’s own proprietary business mix and performance data.