Rubber Stamp? I think not!

Alan, I love your analogy of the PMI guys review of our loan subject - "like a father of a teen-aged-daughter meeting her new leather-clad, tattooed & pierced, motorcycle-riding boyfriend for the first time".   Looks like there's one more thing to add to the pot of worries for that buyerbefore a deal is complete.

Another thing for buyers (and their agents) to consider.  Gone are the days of the rubber stamp, you got that right Alan!!

I'm just laughing... you mean there has been PMI over the past 4 years????   I sell mostly second/vaction homes and they have been requiring 20% down since 2007  If someone had less FHA and VA  has been their only choice and that was ONLY if it was their primary.

Yes, indeed, the PMI guidelines can be even tighter than the lenders.  And, heaven help you if the lender does not have delegated underwriting and has to send the file out to the MI company.  (I had a file last year where the MI underwriter pushed back several times wanting to know why the buyer was buying a home in a location that would require a 70 mile each way commute.  [Uh, this is California.  We drive a lot here.]  Loan amount was $90,000 and the borrower was solid.  Closing delayed two weeks.)  The good news in that, in the last couple of weeks I have been notified of MI guideline changes being relaxed a bit.

Hi Alan,

It is sad, when there are these types of challenges preventing people to make a move...

I am not an advocate of most government institutions, but our federal mortgage laws and federal mortgage insurance system is providing so much more stability, consistency and confidence (and dramatically lower default issues) for all parties, that one would almost suggest something like that for the USA (like that is ever going to happen.....;0)

Oh the insanity of it all.  We don't need any more road blocks in this business.

Yes.  But the drivers are not nearly as crazy as the ones in Chicagoland!!!!

Think of the very concept:  You are approved for the loan but something hinders you being approved for the PMI required when not putting 20% down on such purchase.  That was becoming an issue before I left the business. 

Strange days, indeed:)

Buyers are finding a tough road to travel when applying for a loan these days.  Any more I spend as much time preparing them for what may be the most difficult part of their transaction.  You are right the PMI companies shelled out a lot of cash and they don't survive long doing that.

Alan,  Your post is a reminder to me to try to remind my clients and agents that we are not really seeing anything new in the "La La Land" of finance as much as we are essentially coming home to roost.  Secondary sign off for private mortgage insurance was the "norm" until the late 90's.  In fact, very, very few lenders had delegated MI underwriting ability until around '96 or so.  I once had a file for a first time buyer that was totally approved by the lender; however, it took five MI companies until I could find an approval.  There's a story there......thanks for sparking a subject for a post.