Private mortgage insurers experienced a weaker first quarter compared to the previous year, with new insurance written decreasing by 9%. However, it remained flat from the volumes seen in the fourth quarter of 2023. Despite this decrease, industry-wide NIW for the first quarter totaled $59.1 billion, slightly higher than the previous quarter but lower compared to the same period last year.
Total mortgage production was also lower quarter-to-quarter, according to estimates from the Mortgage Bankers Association. Despite the decrease in production, private mortgage insurance remains a key component for loans sold with loan-to-value ratios over 80% to Fannie Mae and Freddie Mac, competing with government programs like the Federal Housing Administration.
The six active mortgage insurance underwriters showed mixed performance in the first quarter. Some companies gained market share while others saw a slight decrease. Overall, private mortgage insurers faced challenges in the first quarter, but continue to play a vital role in the housing market as they compete with other lenders for market share and provide security for borrowers who may not have enough equity or creditworthiness for traditional lending options.
