Company Reaches 10,000 PMI Cancellation Milestone as More Servicers Choose to Outsource
POWAY, Calif., September 13, 2005 Seven years after the enactment of the law providing consumers the right to cancel their private mortgage insurance (PMI), eAppraiseIT, a leader in real estate valuation, sees a growing trend of mortgage servicers outsourcing parts of the mortgage insurance cancellation process. To date this year, eAppraiseIT, on behalf of servicers, has processed more than 10,000 requests from consumers to cancel their mortgage insurance.
“eAppraiseIT has been providing PMI release services to mortgage servicers on an outsourced basis since 2002, but we have noticed a 110 percent increase in usage this year,” said Diane Valadez, senior vice president of valuation consulting. “Servicers realize the efficiency gains and cost savings they can realize by outsourcing several pieces of the PMI release process.”
Servicers automatically route PMI cancellation requests from borrowers to eAppraiseIT’s private-label call center. eAppraiseIT then counsels the borrower to help them determine if their loan is eligible for PMI cancellation, advises the borrower of the valuation fee and timing, orders the appropriate valuation and reports the results back to the servicer, which makes the ultimate cancellation decision.
eAppraiseIT also offers low-cost automated valuation models (AVMs) for borrowers who inquire about PMI cancellation so they can better judge whether to go forward with the process.
The Homeowners Protection Act, which specifies the requirements for borrowers to cancel their PMI, was signed into law on July 29, 1998, with an effective date of one year later. Generally, borrowers may cancel their PMI after two years if they have made their payments on time and the equity in their home has grown to more than 20 percent. An appraisal, or other acceptable form of valuation, is needed for the cancellation request to be fulfilled by the mortgage servicer. Mortgage insurance is automatically canceled when a loan amortizes to 78 percent of the original value, but as a practical matter few mortgages stay on the books for that long.
About eAppraiseIT: eAppraiseIT offers the most comprehensive and innovative line of products in the valuation industry, including EagleCert®, the industry’s first insured valuation solution; VeriCert, a collateral risk determination tool for wholesale lenders and purchasers; RAVe, a progressive valuation solution designed for equity, default, review and niche channels; and a full suite of industry-leading automated valuation models (AVMs). A joint venture between The First American Corporation (NYSE: FAF) and LandAmerica Financial Group (NYSE: LFG), eAppraiseIT is managed and majority owned by First American. More information about eAppraiseIT and its appraisal products can be found on the Internet at www.eappraiseit.com.