Fitch placed the "AA" insurer financial strength rating of Genworth Mortgage Insurance Corp. and its affiliates on watch for possible downgrade. Fitch downgraded the IFS rating of MGIC Investment Corp.’s mortgage insurance subsidiary Mortgage Guaranty Insurance Corp. to "A+" from "AA." The ratings remain on rating watch negative, Fitch said.
"Although improved mortgage-insurance performance in 2008 and subsequent vintage years should enable MGIC to ultimately return to profitability over time, the present stressful mortgage environment has resulted in pressure to the company’s existing financial position," Fitch said.
Fitch also lowered the IFS ratings of PMI Mortgage Insurance Co. and its affiliates to "A+" from "AA." The ratings remain on rating watch negative.
Additionally, Fitch downgraded the IFS rating of Republic Mortgage Insurance Corp. to "AA-" from "AA," and placed the rating on watch for possible downgrade.
Applications for PMI rose considerably in 2007, as borrowers with limited capital for down payments opted for safer fixed-rate mortgages backed by PMI.