Statement: FHFA’s Release of Fannie Mae and Freddie Mac’s “Equitable Housing Finance Plans for 2022-2024”

WASHINGTONAdolfo Marzol, Chairman of U.S. Mortgage Insurers (USMI), today issued the following statement on the Federal Housing Finance Agency’s (FHFA) public release of Fannie Mae and Freddie Mac’s “Equitable Housing Finance Plans for 2022-2024,” which outline the government-sponsored enterprises’ (GSEs) proposed actions over the next three years to advance equity in housing finance.

“USMI commends the commitment considered in the GSEs’ Equitable Housing Finance Plans toward sustainable approaches that will meaningfully address racial and ethnic disparities in the housing finance system. Our members support efforts to remove barriers to homeownership, increase access and affordability, and promote sustainable homeownership for minority homebuyers. For 65 years, private mortgage insurance has provided access to mortgage financing for millions of borrowers, while also protecting American taxpayers from mortgage credit risk. As an industry focused on serving low down payment homebuyers, we look forward to continued collaboration with FHFA, the GSEs, and other industry stakeholders to advance policies that promote responsible access to equitable and sustainable homeownership while also supporting the GSEs’ safety and soundness.

“As the GSEs develop and implement programs and pilots to promote equitable access to affordable and sustainable housing, it is paramount that they carefully balance access to credit with policies that prudently manage risk to the GSEs. USMI welcomes the FHFA’s creation of the pilot transparency framework and supports increased oversight and accountability of pilots launched in furtherance of the GSEs’ Equitable Housing Finance Plans.”

Since 1957, the private MI industry has exclusively served low down payment borrowers and made sustainable homeownership available for more than 37 million borrowers. On October 25, 2021, USMI submitted a comment letter in response to the FHFA’s Request for Input (RFI) on the “Enterprise Equitable Housing Finance Plans,” detailing actions the GSEs should consider to promote sustainable homeownership and level the playing field for underserved homebuyers.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: USMI Names Essent’s Adolfo Marzol as Chairman of the Board

WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today announced that Adolfo Marzol will serve as the association’s new Chairman of the Board. Marzol is currently an executive at Essent (NYSE: ESNT). He succeeds Derek Brummer, President of Mortgage at Radian Group (NYSE: RDN).

“For 65 years, the private MI industry has helped to provide first-time and low- to moderate-income borrowers with access to affordable and sustainable mortgage credit. The industry has continued to evolve and innovate so that it is better positioned today than ever before to support borrowers and to insulate the government and taxpayers from mortgage credit risk,” said Marzol. “As USMI Chairman, I look forward to working with my industry colleagues and the dedicated team at USMI to ensure the industry continues to play a critical role in the housing finance system and allows borrowers to succeed as sustainable homeowners for the long term.”

Marzol previously served as Principal Deputy Director of the Federal Housing Finance Agency (FHFA). Prior to joining FHFA, Marzol served as Senior Advisor for Housing to Dr. Benjamin S. Carson Jr., the 17th U.S. Secretary for the Department of Housing and Urban Development (HUD). Marzol also brings more than 30 years of private sector experience in mortgage finance, including senior-level positions at Essent, Fannie Mae, and Chase Manhattan Mortgage. Marzol’s diverse industry and policy background includes extensive experience in the areas of mortgage origination and securitization, mortgage servicing, credit risk management, financial management and reporting, policy and governance, and public policy developments related to housing finance.

“Adolfo’s regulatory experience combined with his years of knowledge as a financial and risk management professional in the mortgage finance industry are invaluable assets to our industry association,” said outgoing USMI Chairman Derek Brummer. “Adolfo was instrumental in the creation of USMI and we are honored to welcome him back as our new chairman. I am personally grateful to his dedication and years of service to the housing finance system.”

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: Texas Ranks #1 in the U.S. for Low Down Payment Mortgage Lending in 2021

Over 148,000 in the state turned to private mortgage insurance to achieve homeownership, saving for a 20% down payment could take Texans 13 years.

WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage lending supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. Texas led all other states for the fifth consecutive year for borrowers who benefitted the most from private MI. The report also finds it could take Texans 13 years on average to save for a 20% down payment plus closing costs, but 148,366 homeowners in the state avoided the wait by qualifying for a low down payment mortgage backed by private MI, with 50% of purchasers being first-time homebuyers. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Access to low down payment loans was more important than ever this past year as many Texans weighed economic concerns with surging inflation and home prices skyrocketing due to severely low housing supply,” said Lindsey Johnson, President of USMI. “Through it all, the private MI industry was there to support new borrowers and current homeowners. First-time and low- to moderate-income borrowers were particularly well served during 2021, allowing them to access homeownership sooner.”

Private MI facilitates access to sustainable and affordable mortgage finance credit for millions of people who put less than 20% down on a home loan. The USMI report examines the number of borrowers served, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save a 5% versus 20% down payment for each state plus the District of Columbia. For many Texans, the biggest hurdle in buying a home is the 20% down payment they mistakenly believe is required for mortgage approval.

Key findings about Texas from the report include:

  • It could take 13 years for a Texas household earning the state median income of $68,093 to save 20% (plus closing costs) for a $332,400 single-family home, the median sales price in the state.
  • The wait time decreases to five years if the household purchases a home with a 5% down payment insured mortgage—a 38% decrease in wait time at the state level.
  • Of the Texan homeowners who secured a low down payment loan with private MI in 2021, 59% (a 1% increase from 2020) of purchase mortgages went to first-time buyers, with an average loan amount of $300,438.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve Bank. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance.  According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while at the same time the economy experienced high inflation, limiting people’s ability to save.

“For 65 years, the private MI industry has been leveling the homebuying playing field, enabling over 37 million people access to affordable, low down payment mortgages, serving as a bridge for homebuyers to qualify for home financing despite a low down payment,” Johnson added. “The benefits private MI provides allows Texas homeowners to build the kind of long-term wealth and stability that comes with homeownership.”

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here and more specific information on Texas is available here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: California Ranks #2 in the U.S. for Low Down Payment Mortgage Lending in 2021

Over 134,000 in the state turned to private mortgage insurance to achieve homeownership, saving for a 20% down payment could take Californians 28 years.

WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage lending supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. California ranked second in the nation for the third consecutive year for borrowers who benefitted the most from private MI. The report also finds it could take Californians 28 years on average to save for a 20% down payment plus closing costs, but 134,231 homeowners in the state avoided the wait by qualifying for a low down payment mortgage backed by private MI, with 72% of purchasers being first-time homebuyers. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Access to low down payment loans was more important than ever this past year as many Californians weighed economic concerns with surging inflation and home prices skyrocketing due to severely low housing supply,” said Lindsey Johnson, President of USMI. “Through it all, the private MI industry was there to support new borrowers and current homeowners. First-time and low- to moderate-income borrowers were particularly well served during 2021, allowing them to access homeownership sooner.”

Private MI facilitates access to sustainable and affordable mortgage finance credit for millions of people who put less than 20% down on a home loan. The latest USMI report examines the number of borrowers served, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save for a 5% versus 20% down payment for each state plus the District of Columbia. For many Californians, the biggest hurdle in buying a home is the 20% down payment they mistakenly believe is required for mortgage approval.

Key findings about California from the report include:

  • It could take 28 years for a California household earning the state median income of $77,358 to save 20% (plus closing costs) for a $795,200 single-family home, the median sales price in the state.
  • The wait time decreases to 10 years if the household purchases a home with a 5% down payment insured mortgage—a nearly 36% decrease in wait time at the state level.
  • Of the Californian homeowners who secured a low down payment loan with private MI in 2021, 72% (a 2% increase from 2020) of purchase mortgages went to first-time buyers, with an average loan amount of $478,119.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance. According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while at the same time the economy experienced high inflation, limiting people’s ability to save.

“For 65 years, the private MI industry has been leveling the homebuying playing field, enabling over 37 million people access to affordable, low down payment mortgages, serving as a bridge for homebuyers to qualify for home financing despite a low down payment,” Johnson added. “The benefits private MI provides allows California homeowners to build the kind of long-term wealth and stability that comes with homeownership.”

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here and more specific information on California is available here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: Florida Ranks #3 in the U.S. for Low Down Payment Mortgage Lending in 2021

Nearly 130,000 in the state turned to private mortgage insurance to achieve homeownership, saving for a 20% down payment could take Floridians 18 years.

WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage lending supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. Florida ranked third in the nation for the third consecutive year for borrowers who benefitted the most from private MI. The report also finds it could take Floridians 18 years, on average to save for a 20% down payment plus closing costs, but 128,897 homeowners in the state avoided the wait by qualifying for a low down payment mortgage backed by private MI, with 55% of purchasers being first-time homebuyers. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Access to low down payment loans was more important than ever this past year as many Floridians weighed economic concerns with surging inflation and home prices skyrocketing due to severely low housing supply,” said Lindsey Johnson, President of USMI. “Through it all, the private MI industry was there to support new borrowers and current homeowners. First-time and low- to moderate-income borrowers were particularly well served during 2021, allowing them to access homeownership sooner.”

The USMI report examines the number of borrowers served, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save for a 5% versus 20% down payment for each state plus the District of Columbia. For many Floridians, the biggest hurdle in buying a home is the 20% down payment they mistakenly believe is required for mortgage approval.

Key findings about Florida from the report include:

  • It could take 18 years for a Florida household earning the state median income of $57,435 to save 20% for a $371,600 single-family home, the median sales price in the state.
  • The wait time drops to six years if the household purchases a home with a 5% down payment, where the loan is sustainably backed by private MI—a 33% decrease in wait time at the state level.
  • Of the Floridian homeowners who secured a low down payment loan with private MI in 2021, 55% of purchase mortgages went to first-time buyers, with an average loan amount of $299,707.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve Bank. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance.  According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while at the same time the economy experienced high inflation, limiting people’s ability to save.

“For 65 years, the private MI industry has been leveling the homebuying playing field, enabling over 37 million people access to affordable, low down payment mortgages, serving as a bridge for homebuyers to qualify for home financing despite a low down payment,” Johnson added. “The benefits private MI provides allows Florida homeowners to build the kind of long-term wealth and stability that comes with homeownership.”

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here and more specific information on Florida is available here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: Illinois Ranks #4 in the U.S. for Low Down Payment Mortgage Lending in 2021

Over 84,000 in the state turned to private mortgage insurance to achieve homeownership, saving for a 20% down payment could take Illinoisans 11 years.

WASHINGTON U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage lending supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. Illinois ranked fourth in the nation for the fifth consecutive year for borrowers who benefitted the most from private MI. The report also finds it could take Illinoisans 11 years on average to save for a 20% down payment plus closing costs, but 84,490 homeowners in the state avoided the wait by qualifying for a low down payment mortgage backed by private MI, with 65% of purchasers being first-time homebuyers. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Access to low down payment loans was more important than ever this past year as many Illinoisans weighed economic concerns with surging inflation and home prices skyrocketing due to severely low housing supply,” said Lindsey Johnson, President of USMI. “Through it all, the private MI industry was there to support new borrowers and current homeowners. First-time and low- to moderate-income borrowers were particularly well served during 2021, allowing them to access homeownership sooner.”

Private MI facilitates access to sustainable and affordable mortgage finance credit for millions of people who put less than 20% down on a home loan. The USMI report examines the number of borrowers served, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save a 5% versus 20% down payment for each state plus the District of Columbia. For many Illinoisans, the biggest hurdle in buying a home is the 20% down payment they mistakenly believe is required for mortgage approval.

Key findings about Illinois from the report include:

  • It could take 11 years for an Illinois household earning the state median income of $73,753 to save 20% (plus closing costs) for a $290,500 single-family home, the median sales price in the state.
  • The wait times decreases to four years if the household purchases a home with a 5% down payment insured mortgage—a 35% decrease in wait time at the state level.
  • Of the Illinoisan homeowners who secured a low down payment loan with private MI in 2021, 65% (a 1% increase from 2020) of purchase mortgages went to first-time buyers, with an average loan amount of $250,067.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve Bank. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance.  According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while at the same time the economy experienced high inflation, limiting people’s ability to save.

“For 65 years, the private MI industry has been leveling the homebuying playing field, enabling over 37 million people access to affordable, low down payment mortgages, serving as a bridge for homebuyers to qualify for home financing despite a low down payment,” Johnson added. “The benefits private MI provides allows Illinois homeowners to build the kind of long-term wealth and stability that comes with homeownership.”

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here and more specific information on Illinois is available here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: Ohio Ranks #5 in the U.S. for Low Down Payment Mortgage Lending in 2021

Over 64,000 in the state turned to private mortgage insurance to access homeownership, saving for a 20% down payment could take Ohioans 10 years.

WASHINGTON U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage lending supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. Ohio was among the top five states in the nation for borrowers who benefitted the most from private MI. The report also finds it could take Ohioans 10 years on average to save for a 20% down payment plus closing costs, but 64,149 homeowners in the state avoided the wait by qualifying for a low down payment mortgage backed private MI, with 60% of purchasers being first-time homebuyers. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Access to low down payment loans was more important than ever this past year as many Ohioans weighed economic concerns with surging inflation and home prices skyrocketing due to severely low housing supply,” said Lindsey Johnson, President of USMI. “Through it all, the private MI industry was there to support new borrowers and current homeowners. First-time and low- to moderate-income borrowers were particularly well served during 2021, allowing them to access homeownership sooner.”

Private MI facilitates access to sustainable and affordable mortgage finance credit for millions of people who put less than 20% down on a home loan. The USMI report examines the number of borrowers served, the percentage of borrowers who were first-time homebuyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save a 5% versus 20% down payment for each state plus the District of Columbia. For many Ohioans, the biggest hurdle in buying a home is the 20% down payment they mistakenly believe is required for mortgage approval.

Key findings about Ohio from the report include:

  • It could take 10 years for an Ohio household earning the state median income of $60,110 to save 20% (plus closing costs) for a $214,400 single-family home, the median sales price in the state.
  • The wait time drops to three years if the household purchases a home with a 5% down payment insured mortgage—a 30% decrease in wait time at the state level.
  • Of the Ohio homeowners who secured a low down payment loan with private MI in 2021, 60% (a 1% increase from 2019) of purchase mortgages went to first-time buyers, with an average loan amount of $217,314.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve Bank. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance.  According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while at the same time the economy experienced high inflation, limiting people’s ability to save.

“For 65 years, the private MI industry has been leveling the homebuying playing field, enabling over 37 million people access affordable, low down payment mortgages, serving as a bridge for homebuyers to qualify for home financing despite a low down payment,” Johnson added. “The benefits private MI provides allows Ohio homeowners to build the kind of long-term wealth and stability that comes with homeownership.”

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here and more specific information on Ohio is available here.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.

Press Release: New Report – For 65 Years, Private Mortgage Insurers Enabled More than 37 Million Families to Access Homeownership Sooner

In 2021, the industry helped nearly 2 million low down payment borrowers secure mortgage financing; Texas, California, Florida, Illinois, and Ohio rank as the top states for mortgage financing with private MI.

WASHINGTON — U.S. Mortgage Insurers (USMI), the association representing the nation’s leading private mortgage insurance (MI) companies, today released its annual report on mortgage financing supported by private MI at the national and state levels. The report finds that the industry helped more than 37 million low down payment borrowers over its 65-year history to secure mortgage financing, including nearly 2 million in 2021, according to data from the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac. Meanwhile, the report finds that saving for a 20% down payment could take potential homebuyers 14 years — almost three times longer to save for a 5% down payment. Texas, California, Florida, Illinois, and Ohio rank as the top five states for mortgage financing with private MI. According to Fannie Mae, private MI ranks among the lowest costs associated with homeownership, with total private MI payments representing 0.5% of lifetime homeownership costs for the average purchase borrower, plus it can be canceled after a period of time.

“Skyrocketing home prices driven by record low housing supply have made homeownership unreachable for many Americans. It is critical that affordable, sustainable low down payment mortgages are available to meet borrowers’ needs,” said Lindsey Johnson, President of USMI. “For 65 years, the private MI industry has been helping to level the homebuying playing field, providing first-time and low- to moderate-income borrowers with access to mortgage credit. Thanks to private MI nearly 2 million borrowers purchased a home or refinanced in 2021.”

Private MI facilitates access to sustainable and affordable mortgage finance credit for millions of people who have down payments smaller than 20%. The latest USMI report examines the number of borrowers served, the percentage of borrowers who were first-time buyers, average loan amounts, and average FICO credit scores. USMI also calculates the number of years to save for a 5% versus 20% down payment for each state plus the District of Columbia.

Key findings from the report include:

  • It could take 14 years on average for a household earning the national median income of $67,521 to save 20% (plus closing costs), for a $353,400 single-family home, the national median sales price.
  • The wait time decreases to five years with a 5% down payment insured mortgage — a 64% shorter wait time at the national level.
  • In 2021, the number of homeowners who qualified for a mortgage because of private MI reached nearly 2 million.
  • Nearly 60% of purchase mortgages went to first-time buyers, and more than 40% had annual incomes below $75,000. The average loan amount purchased or refinanced with private MI was $310,275.
  • The private MI industry supported approximately $585 billion in mortgage originations in 2021. Approximately 80% was for new purchases while 20 percent was for refinanced loans, resulting in approximately $1.4 trillion in outstanding mortgages with active private MI coverage at year-end.

The number of years to save for a down payment decreased in comparison to USMI’s past reports as the personal saving rate reached record highs during the first six months of 2021, as reported by the Federal Reserve. This was largely due to consumer spending decreasing, government stimulus checks, and an increase in unemployment insurance. According to a 2020 Congressional Research Service report, the “saving rate usually goes up when there’s a decline in general economic activity, but it can quickly fall back down when there are positive signs of growth.” The U.S. economy experienced this growth as businesses reopened during the second half of 2021, once the COVID-19 pandemic started to recede. As a result, personal saving rates resumed regular levels as consumers began spending more and saving less, while the economy also experienced high inflation, limiting people’s ability to save.

The below table shows the top five states where private MI was used by borrowers to purchase or refinance homes in 2021.

State Number of Borrowers Helped with Private MI First-Time Homebuyers
Texas 148,366 59%
California 134,231 72%
Florida 128,897 55%
Illinois 84,490 65%
Ohio 64,149 60%

 

Loans backed by private MI provide protection against mortgage credit risk and is structured to protect the GSEs in the conventional mortgage market. In 2021, the industry insured $1.4 trillion of mortgages, including $1.2 trillion of mortgages backed by the GSEs. Private MI has proven to be a reliable method for shielding the GSEs, having paid nearly $60 billion in claims since the 2008 financial crisis and housing market downturn.

USMI worked closely with federal policymakers, industry groups, and consumer organizations to support and advocate for low down payment homebuyers and homeowners throughout the year. The organization sent letters and released statements in support of bipartisan and bicameral legislative initiatives to make permanent the ability of homeowners to deduct MI premiums from federal income; submitted a comment letter on the Federal Housing Finance Agency’s (FHFA) Request for Input (RFI) on the GSEs’ Equitable Housing Finance Plans; and joined the Black Homeownership Collaborative in calling on the Biden Administration to focus on the critical need for housing production to address the significant deficit that continues to drive up home prices across the country.

The complete report is available here, along with fact sheets for all 50 states and the District of Columbia.

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U.S. Mortgage Insurers (USMI) is dedicated to a housing finance system backed by private capital that enables access to housing finance for borrowers while protecting taxpayers. Mortgage insurance offers an effective way to make mortgage credit available to more people. USMI is ready to help build the future of homeownership. Learn more at www.usmi.org.