Fannie Mae has approved a second subsidiary of Genworth Mortgage Insurance Corp. as an eligible mortgage insurance writer.
Several of the private mortgage insurers have established subsidiaries to keep writing business in the event their main operation breaches the 25:1 risk-to-capital ratio or minimum policy position required by 16 states.
A spokesman for Genworth said the subsidiary, Genworth Residential Mortgage Assurance Corp., is not yet writing any business.
The lender letter from Fannie Mae says GRMAC is approved to write coverage "in a limited number of states, which may change over time." However, the Genworth spokesman noted "the entity is approved by regulators to write business in all 50 states, but we intend to use it only in states where our existing entities are unable to write business."
The approval was effective as of April 18, although the lender letter was not issued until May 17.
Freddie Mac has not approved GRMAC as of now, the Genworth spokesman said.
This is the third underwriting entity from Genworth that Fannie Mae has approved. Besides GMICO, Genworth Residential Mortgage Insurance Corp. of North Carolina was approved to write business.