How Do You Know About MI

Guys,

I KNOW this is a juvenile question but in my 8 years being a realtor, 5 years full-time and 3 years of only doing short sales, I have NEVER done a deal that involves MI. (I know, I have a long way to go).

Is this something that the homeowner knows and can tell you?

When I meet a homeowner, I ask them to tell me the liens they have on the property. 10 times out of 10, the homeowner spouts of the 1st mortgage, 2nd mortgage, sometimes even the 3rd mortgage. Is MI one of those things the homeowner should "spout" off?

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Replies to This Discussion

Permalink Reply by Kent Dills on January 12, 2010 at 1:34am
Mori,

You could always ask the homeowner but my experience is that homeowners often don't know if they have PMI/MI or not.

You could ask the lenders when you send in the short sale package (like when you ask about who the investor is behind the loan) but often times the you won't find out this way until you start communicating with the negotiator.

Basic rules of thumb that apply are, FHA loans always have PMI and conventional loans that had less than 20% down have MI. There are a few exceptions to these rules of thumb (that's why their rules of thumb versus facts) but these will "get you down the road"!
Permalink Reply by Mori Langshaw Sr on January 12, 2010 at 1:54am
Thanks Kent!
Permalink Reply by James ferebee jr on January 12, 2010 at 2:11am
Mori where have you been to escape MI ins?... Kent is right you could ask that question while first talking to cust serv after your ATR is in and you are asking common questions about the loan, you also can look at their HUD and if they have not placed it where it can never be found it will have the PMI info on it. Also if the bank will tell you the amount of coverage the PMI is you can calculate the amount that PMI will pay after the short sale amount is determined.
However they don't like to give you that amount because you will know what PMI will pay and that gives you leverage with negotiations when they say the amount that you offer is too low there are a few PMI companies out there and if you can get that out of the lender you can call the PMI co, and they will give you that number.

I posted an article from a friend who sent it to me from a class that he had taken from Josh Cantwell.
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Permalink Reply by Mori Langshaw Sr on January 12, 2010 at 2:32am
Sweet Thanks James.

In my area, it is really common for folks to do 100 with piggy backs doing 80/20, 80/15, 80/10, 80/10/10, etc, etc . I have done countless transactions like that. Just not with MI. Go figure. I've only been in 8 years...lol. So I'll have my share....
Permalink Reply by Jeffrey Smith on January 17, 2010 at 9:50am
Hi Mori,
I really liked your video. I know plenty of agents with brokers just like you depicted - won't change with the times. You may be amused to know that a loss mitigator for a 2nd lien holder told me that they had insurance and needed to get 20% because they would get 20% if the property foreclosed. There is no such thing for a second lien holder according to all the loss mitigators I've talked to.
Permalink Reply by Laura Marshall on February 11, 2010 at 2:09pm
As soon as you take a listing and send in the Authorization to Release information, call the general customer service department. Ask if there is MI. If they don't know, ask for the insurance department. They handle homeonwers ins and MI. I had a short sale denied at the very end because the MI company (PMI) wanted the unemployed sellers to carry a $70,000 note. I was not aware of MI, and was never told about it. The sellers usually don't know if they have it or not. It is best to begin fully informed. I am now working with another one with MI. They have requested an unbelievable amount of information from the seller...separate from the information requested by the bank for the short sale. You must get the bank approval, investor approval and MI approval.
Permalink Reply by Stephanie Lim on March 18, 2010 at 12:25am
I have decided that this MI issue is far trickier than I used to think. I have seen MI companies that have pulled the credit reports of sellers in default when the first mortgage was 80%, second mortgage was 10% and 10% was put down. Sellers had no knowledge of involvement of PMI company nor did they have a clue why the MI company was pulling their credit or that they were.

When the mortgage has been thrown into a pool of MBS, are the insurance policies purchased issued by MI companies? I know AIG was involved in this type of insurance. Anybody know? What I am discovering is that the web is far more tangled than most people realize...
Permalink Reply by Kimberley Kelly on October 22, 2010 at 12:03pm
Nice PMI document..thanks. Will help to get info up front, then go directly to the MI companies..

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