On Tuesday, Freddie Mac suspended Republic Mortgage Insurance Co. as an approved mortgage insurer, according to an email it is sending to its sellers.
The letter states the move is effective immediately, although it adds mortgages insured by RMIC whose note dates are before May 1 or after Sept. 1, are not eligible for sale to Freddie Mac.
Freddie Mac's actions follow Fannie Mae's suspension of RMIC on July 29. The day before, Old Republic International Corp. said in its second quarter results release that if it could not negotiate an agreement with RMIC's primary regulator in North Carolina and the GSEs over using another subsidiary to write new insurance policies nationwide, it was likely to put RMIC into runoff.
Fannie Mae also suspended that subsidiary, Republic Mortgage Insurance Co. of North Carolina, as an approved MI.
North Carolina insurance regulators said they would not approve an extension of RMIC's waiver to meet the state's minimum policyholder position requirement; the current waiver expires on Aug. 31.
Mortgages with existing RMIC certificates of insurance will continue to be eligible for sale to Freddie Mac if they are refinanced under the Freddie Mac Relief Refinance Mortgages offering, and the coverage is continued through modification of the existing mortgage insurance certificate.
The move will not affect mortgages that Freddie Mac has purchased which are already insured by RMIC, nor are there changes to the servicing requirements for mortgages insured by RMIC.
A call to ORI looking to find out how the company plans to proceed going forward was not returned by press time.
