before and after attorny

[tobee43]

If I was living in a recourse state and the only thing standing between me and possible bankruptcy was a PMI-insured first loan, I would definitely be looking into it.

To muddy the water a bit more-would the debtors PMI carrier have recourse against them?
Might not hurt to include your PMI carrier in your creditors matrix.

keepmine, i know we did include it all in our petition...since the mortgage was an FHA with PMI, the entire amount was listed. the PMI would come from an FHA claim, (i know HUD's in there somewhere, since they are tied together). so, actually the PMI on an FHA is backed or insured by the goverment which is US? isn't it??? holy COW.i think i'll be going MIA on this..

still interesting none the less.

[debee]

I can't imagine a PMI lawsuit - the insurance is specifically against borrower default, so it doesn't make sense that the insurance provider could sue the person for the thing they are insuring against. It would be like paying a monthly fee for accidental fire insurance, having an accidental fire loss and then getting sued by the insurance company because there was an accidental fire.

Anyway, I guess crazier things have happened. I love what bankruptcy can do. Once the mortgage is included & discharged, the debtor can forget about deficiencies and PMI and all the rest of it. The thing is dead, forever.

[tobee43]

I can't imagine a PMI lawsuit - the insurance is specifically against borrower default, so it doesn't make sense that the insurance provider could sue the person for the thing they are insuring against. It would be like paying a monthly fee for accidental fire insurance, having an accidental fire loss and then getting sued by the insurance company because there was an accidental fire.

Anyway, I guess crazier things have happened. I love what bankruptcy can do. Once the mortgage is included & discharged, the debtor can forget about deficiencies and PMI and all the rest of it. The thing is dead, forever.

that's the way i understand it as well. once the bk is file and the house with it's mortgage was in included, the bk was discharged and closed, would hopefully close the entire situation concerning any default deficiency.

did we really agree on someting...ROFL!!!!!!!!!!! i think so!

[keepmine]

I can't imagine a PMI lawsuit - the insurance is specifically against borrower default, so it doesn't make sense that the insurance provider could sue the person for the thing they are insuring against. It would be like paying a monthly fee for accidental fire insurance, having an accidental fire loss and then getting sued by the insurance company because there was an accidental fire.

Anyway, I guess crazier things have happened. I love what bankruptcy can do. Once the mortgage is included & discharged, the debtor can forget about deficiencies and PMI and all the rest of it. The thing is dead, forever.

Not quite sure that ex. is on point.
I see it as more of a situation where, an unisured motorist is at fault in an accident and the party injured does have insurance. The insurance company pays their customer and then sues the uninsured motorist. That happens pretty frequently.
Can't see why that wouldn't/couldn't happen with a PMI carrier and a default.
That being said, I've never heard of that happening-likely because recovery is remote. I mean, there's a difference in getting a few thousand dollar judgment paid against someone for property damage vs a default running into many tens of thousands of dollars. Likely, you'd be sitting with worthless paper.

[debee]

Not quite sure that ex. is on point.
I see it as more of a situation where, an unisured motorist is at fault in an accident and the party injured does have insurance. The insurance company pays their customer and then sues the uninsured motorist. That happens pretty frequently.
Can't see why that wouldn't/couldn't happen with a PMI carrier and a default.
That being said, I've never heard of that happening-likely because recovery is remote. I mean, there's a difference in getting a few thousand dollar judgment paid against someone for property damage vs a default running into many tens of thousands of dollars. Likely, you'd be sitting with worthless paper.

Yeah, I think I saw that same analogy in an article on PMI at a Real estate website. I have problems with it.

For one thing, the homeowner isn't uninsured like a driver. In fact, the homeowner is the one buying the PMI insurance. They don't benefit from it, but they pay for it. The only difference between the fire insurance analogy and PMI is the loss payee. One names whoever the homeowner indicates (self, bank + self, Aunt Betty, the cat) and the other names the lender.

Also, the PMI company is in the business of taking risks and profiting by those risks. That's the whole point of their business. They charge the monthly premium knowing that at least some of those who are paying it will default. Those who don't default pay for those who do, with a good deal left over for the company's bottom line.