Four Largest Mortgage Insurers Tagged by CFPB in Illegal Kick-Back Scheme

Hot news from AZ Home Help:

Posted To: MND NewsWire

The four largest remaining private mortgage insurance (PMI) companies have agreed to end what the Consumer Financial Protection Bureau ( CFPB ) called "illegal kickbacks" in complaints and consent orders announced by the Bureau today. These complaints charge that the companies along with unspecified numbers of mortgage lenders have for years engaged in a sham reinsurance structure devised to hide kickbacks from the PMI companies to the lenders. The company which is to provide PMI to a borrower with less than a 20 percent downpayment is determined by the lender who is also the beneficiary of the PMI policy in the event of a default even though it is the borrower who pays the premium. In order to secure PMI business the four companies are accused of purchasing reinsurance to hedge their own risk...(read more)

Forward this article via email:  Send a copy of this story to someone you know that may want to read it.

Source: http://www.mortgagenewsdaily.com/04042013_cfpb_enforcement_pmi.asp

- For more real estate news visit our website at http://www.AzHomeHelp.com