Since 2004, nearly 1,000 homeowners with MassHousing home mortgage loans lost their jobs. But more than 82% of them were able to continue making their monthly mortgage payments, find a new job and avoid foreclosure because of MIPlus™, MassHousing’s unique mortgage insurance product.
Private Mortgage Insurance traditionally only protects the lender’s interest but MassHousing’s MIPlus goes a step further, at no additional cost to the borrower, by paying their principal and interest payments for up to six months in the event of a job loss.
Since MassHousing created the product in 2004, MassHousing’s Mortgage Insurance Fund (MIF) has paid claims to 975 borrowers who lost their jobs. The average benefit was approximately $947 a month for an average duration of five months. Of the 975 beneficiary recipients, only 172 were not able to remain in their homes (116 were foreclosures, 39 were short sales and 17 were deed-in-lieu of foreclosure).
"MIPlus has been an incredible success story in helping MassHousing borrowers keep their homes and avoid foreclosure after a job loss," said MassHousing Executive Director Tim Sullivan. "MIPlus has provided an important safety net for these borrowers who were able to focus on becoming employed again while staying current on their monthly payments."
MIPlus is provided with every MassHousing loan that requires Mortgage Insurance and Massachusetts lenders can also use MIPlus to insure their own portfolio loans. The product’s job-loss protection benefit is one of only a few of its kind in the mortgage insurance industry.
MIPlus incentivizes borrowers to be proactive and reach out to the MIF at the first signs of trouble. This triggers a collaborative effort between the Mortgage Insurance Fund and MassHousing’s Loan Servicing department to work together to assist the troubled borrower early in the process. This high touch approach has resulted in continuous years of default rates that fall below the industry standard. The Agency’s current default rate is just 2.3%.
"When it comes to MassHousing’s Mortgage Insurance Fund the following words come to mind: flexible, dependable, forward-thinking, responsive," said MassHousing Deputy Director Karen Kelleher.
The MIF is a full-service insurer and eligible to insure Fannie Mae, Freddie Mac and Federal Home Loan Bank loans.
MassHousing’s MIF is available to income-eligible borrowers who earn no more than 135% of Area Median Income (AMI). To serve the Commonwealth’s most vulnerable borrowers, those who earn 80% or less of AMI are eligible for the Agency’s MI Discount, which is 20% off the standard rate.
In addition to this borrower-focused offering, the MIF is a valuable resource for MassHousing’s network of more than 150 lenders by providing Mortgage Insurance flexibility for loans they keep in their portfolio or sell to Fannie Mae, Freddie Mac, or the Federal Home Loan Bank and service themselves.
Overall, MassHousing’s total insurance in force through the MIF is 10,545 loans for $2.1 billion in coverage. Over the MIF's history, it has insured 29,819 loans with original loan amounts totaling $5.5 billion.