Fannie today hurled a far-from-improvised explosive device at the traditional MI business model, announcing “enterprise-paid mortgage insurance” or EPMI. Although only a pilot program, EPMI has far-reaching potential to redefine not only the MI model, but also mortgage servicing. If this program takes off before the Trump Administration decides what to do with the GSE conservatorships, then the GSEs will be monolithic controlling factors across not only mortgage origination and securitization, but also MI and servicing.
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