Radian's Latest MI Product Helps Lower Homebuyers'
Monthly Mortgage Payments
PHILADELPHIA, Dec. 9 /PRNewswire-FirstCall/ -- Radian Guaranty, a provider
of mortgage insurance products and services and subsidiary of global credit
enhancement provider Radian Group Inc. (NYSE: RDN), announced that its
SplitEdge mortgage insurance product will now be accepted on loans purchased
through EMC Mortgage Corporation's National Mortgage Conduit Network.
EMC, a Texas-based wholly owned subsidiary of The Bear Stearns Companies
Inc. (NYSE: BSC), has purchased 330,000 loans so far this fiscal year for $53
billion from mortgage bankers across the country. SplitEdge gives EMC's
conduit sellers a new way to help homebuyers reduce their monthly mortgage
insurance (MI) payments.
Traditionally, homebuyers with less than a 20% down payment purchase
mortgage insurance in order to secure a mortgage loan. The homebuyer
typically pays for the insurance through monthly installments. With
SplitEdge, homebuyers can make a one-time, upfront MI payment -- which can be
.75%, 1.00%, or 1.25% of the total mortgage loan -- that significantly lowers
the monthly MI installments that the homebuyer must pay.
By adopting Radian's SplitEdge, EMC provides lenders and borrowers new MI
options on mortgage loans that require low or no downpayment. SplitEdge is
designed to allow the upfront one-time MI premium to be paid by the homebuyer
or approved third parties, including the borrower's family, non-profit
community based organizations, homebuilders, and home sellers.
"Radian continues to focus on helping our customers enhance their business
while enabling them to offer more flexibility to the borrower community," said
Tony Bruschi, Vice President, Correspondent Sales for Radian. "We are excited
that EMC Mortgage Corporation has decided to introduce SplitEdge to their
lenders. SplitEdge reflects Radian's on-going commitment to bring innovative
MI products and services to the mortgage industry."
Radian launched SplitEdge in July 2005 and since then has worked with
homebuilders and state and local housing agencies to use this product in order
to reduce their customers' total monthly mortgage payments. With a core
back-end infrastructure in place, Radian is able to adapt SplitEdge to other
market segments efficiently.
"Radian's SplitEdge gives our conduit customers another innovative
mortgage loan option they can bring to their borrowers," said Jo Whitlock,
senior vice president of EMC Mortgage, head of conduit operations.
About Radian Guaranty Inc.
Radian Guaranty Inc. is the mortgage insurance subsidiary of Radian Group
Inc. (NYSE: RDN), a global credit enhancement company headquartered in
Philadelphia. Radian Guaranty provides risk management products and services
to mortgage lenders nationwide; these services increase opportunities for
people to buy homes with little or no downpayment, protect lenders from
default-related losses on residential first mortgages and facilitate the sale
of low-downpayment mortgages in the secondary market. Additional information
may be found at http://www.radian.biz.
About EMC Mortgage Corporation
EMC Mortgage Corporation, a wholly owned subsidiary of The Bear Stearns
Companies Inc. (NYSE: BSC), is a mortgage banking company specializing in the
acquisition, securitization, servicing and disposition of residential loans.
Their proven success is built on a foundation of providing competitive pricing
and excellent portfolio management. This disciplined focus has enabled EMC to
grow from 10 employees in 1990 to more than 1,200 professionals employed at
EMC Mortgage Corporation's current corporate facility in Irving Texas. For
more information, please visit http://www.emcmortgagecorp.com.
All statements made in this press release that address events or
developments that we expect or anticipate may occur in the future are
"forward-looking statements" within the meaning of Section 27A of the
Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and
the U.S. Private Securities Litigation Reform Act of 1995. These statements
are made on the basis of management's current views and assumptions with
respect to future events. The forward-looking statements, as well as Radian's
prospects as a whole, are subject to risks and uncertainties, including the
following: changes in general financial and political conditions such as
extended national or regional economic recessions (or expansions), changes in
housing values, population trends and changes in household formation patterns,
changes in unemployment rates, changes or volatility in interest rates, or
other political instability; changes in investor perception of the strength of
private mortgage insurers or financial guaranty providers, and risks faced by
the businesses, municipalities or pools of assets covered by Radian's
insurance; the loss of a customer with whom Radian has a concentration of its
insurance in force; rising delinquencies in mortgage loans insured by Radian
resulting from increased consolidation of mortgage lenders and servicers;
increased severity or frequency of losses associated with certain Radian
products that are riskier than traditional mortgage insurance and municipal
guaranty insurance policies; material changes in persistency rates of Radian's
mortgage insurance policies; downgrades of the insurance financial-strength
ratings assigned by the major ratings agencies to Radian's operating
subsidiaries; heightened competition from other insurance providers and from
alternative products to private mortgage insurance and financial guaranty
insurance; changes in the business practices of Fannie Mae and Freddie Mac;
the application of existing federal or state consumer lending, insurance and
other applicable laws and regulations, or unfavorable changes in these laws
and regulations or the way they are interpreted or applied, including: (i) the
possibility of private lawsuits or investigations by state insurance
departments and state attorneys general alleging that services offered by the
mortgage insurance industry, such as captive reinsurance, pool insurance and
contract underwriting, are violative of the Real Estate Settlement Procedures
Act and/or similar state regulations (particularly in light of public reports
that some state insurance departments may review or investigate captive
reinsurance arrangements used in the mortgage insurance industry), (ii) the
outcome of private lawsuits that have been brought against us or that may be
brought against us and other mortgage insurers under the Fair Credit Reporting
Act, or (iii) legislative and regulatory changes affecting demand for private
mortgage insurance or financial guaranty insurance; the possibility that we
may fail to estimate accurately the likelihood, magnitude and timing of losses
in connection with establishing loss reserves for our mortgage insurance or
financial guaranty businesses or to estimate accurately the fair value amounts
of derivative financial guaranty contracts in determining gains and losses on
these contracts; changes in accounting guidance from the SEC or the Financial
Accounting Standards Board regarding income recognition and the treatment of
loss reserves in the mortgage insurance or financial guaranty industries;
changes in claims against mortgage insurance products resulting from the aging
of Radian's mortgage insurance policies; vulnerability to the performance of
Radian's strategic investments; international expansion of our mortgage
insurance and financial guaranty businesses into new markets and risks
associated with our international business activities; and the loss of
executive officers or other key personnel. Investors are also directed to
other risks discussed in documents filed by Radian with the SEC, including the
factors detailed in our annual report on Form 10-K for the year ended December
31, 2004 in the section immediately preceding Part I of the report. We
caution you not to place undue reliance on these forward-looking statements,
which are current only as of the date of this press release. Radian does not
intend to and disclaims any duty or obligation to update or revise any
forward-looking statements made in this press release to reflect new
information, future events or for any other reason.
SOURCE Radian Guaranty Inc.
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Related links:
http://www.radian.biz
http://www.emcmortgagecorp.com
CONTACT:
Investors: Mona Zeehandelaar,
+1-215-231-1674, mona.zeehandelaar@radian.biz, or Media:
Corporate Communications, 1-888-NEWS-520, media@radian.biz, both
of Radian Guaranty Inc.; or Media: Renu Aldrich of Bear Stearns,
+1-212-272-2097, raldrich@bear.com; or Media: Debbie Krznarich of
EMC Mortgage, +1-972-868-4270, dkrznarich@bear.com
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