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Mortgage repurchases have been notably costly this yr for lenders that resolve them by reselling the mortgages in the scratch-and-dent market. So some corporations have turned to an alternate.
Lenders like Beeline and Plaza Residence Loans have purchased repurchase insurance coverage for sure varieties of mortgage defects which will immediate government-sponsored enterprises Fannie Mae and Freddie Mac to request buybacks.
What mortgage corporations and a few suppliers are discovering is excessive prices related to fraud and defect danger might make the protection compelling however skinny margins for originators argues for purchasing it selectively in some instances.
To assist corporations navigate these issues, we requested a number of consultants about a number of the numerous choices out there just lately and their limits.
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