Mortgage Rules To Get Tougher Under United Guaranty

Washington, DC (AHN) - United Guaranty is set to impose tighter mortgage rules next week ranging from asking for higher down-payments to a no loans policy for areas classified as a declining real estate market.

Mortgage insurer United Guaranty, a subsidiary of the giant underwriter AIG International, is likely to spark changes in the industry as other mortgage insurance providers follow the firm's new policies.

Rental units and condos not owner-occupied are expected to be hit hard by the stringent measure, according to the Realty Times. The new rules would also cover purchases of second homes.

Aside from United Guaranty, Fannie Mae and Freddie Mac recently introduced new guidelines for condo financing. Fannie Mae imposed a 49 percent cap on units owned by investors and a 15 percent limit on delayed association dues.

Aside from mortgage guaranty insurance for first and second mortgages, United Guaranty has mortgage conduit and mortgage fraud recovery services and student loan default insurance.