BOSTON - Mercer Management Consulting on Tuesday released a study that it said showed that the automated underwriting systems of private mortgage insurers generate more loan approvals than those of Fannie Mae and Freddie Mac.
The study, which was commissioned by General Electric Mortgage Insurance Corp. of Raleigh, N.C.; United Guaranty Corp. of Greensboro, N.C.; and Winston-Salem, N.C.-based Republic Mortgage Insurance Corp., examined 153,265 loans. It found that mortgage insurance systems approved 9.75% more than the agencies' systems.
Mercer officials said the study was conducted to assist Ginnie Mae and members of Congress who are evaluating a proposal to create a public-private partnership that would permit Ginnie Mae to accept conventional low-down- payment mortgage loans for the first time.
Mercer officials said that the proposal would create an opportunity to introduce to the mortgage marketplace additional proven automated underwriting systems beyond the two dominant systems of Fannie Mae and Freddie Mac.