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Conventional Mortgage Insurance

To:     VHDA Originating Lenders

Date: December 12, 2014

Re:    Conventional Mortgage Insurance

Approved Companies
The following companies are approved to issue mortgage insurance for loans to be purchased by VHDA:

Arch Mortgage Insurance Company
Essent Guaranty, Inc.
Genworth Mortgage Insurance
National MI
Radian Guaranty, Inc.
United Guaranty

Required Coverage
VHDA requires standard agency coverage – even if the lender is using an Automated Underwriting Approval which allows lower charter coverage.

Loan to Value            Coverage
97.00% - 95.01%        35%
95.00% - 90.01%        30%
90.00% - 85.01%        25%
85.00% - 80.01%        12%

 VHDA requires all loans to be submitted directly to the mortgage insurer for approval – delegated approvals are not accepted.   The mortgage insurance certificate must be included in the loan package submitted to VHDA.  Also follow the MI company’s procedure of identifying the loan as a HFA or VHDA loan when submitting the loan to them for underwriting. 

Financed Mortgage Insurance and Split Premiums
In addition to other traditional premium plans, VHDA will allow single premium and split premiums, however, if any portion of the mortgage insurance is financed in the first mortgage amount, the total loan (including any financed mortgage insurance premium) may not exceed 97.00% loan to value.

Loans must comply with the individual insurer guidelines, even if VHDA’s published guidelines are more flexible.  Loans must meet the stricter of VHDA, AUS finding (if applicable) and the mortgage insurer guidelines.  This includes adherence to criteria such as maximum LTV/CLTV, minimum credit score, cash reserves, maximum seller contributions, maximum ratios, minimum borrower contribution and property requirements.

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