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Government should examine its role in housing, MGIC CEO says


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Government should examine its role in housing, MGIC CEO says

The FederalHousing Administration should not adjust the annual price of its mortgage insurancewithout a broader discussion about the government's role in the housing market,MGIC Investment Corp. Presidentand CEO Patrick Sinks said.

The FHAhas been considering a reduction in its mortgage insurance rate, a move that wouldshift business away from private insurers and place risk on taxpayers, Sinks saidduring a conference call to discuss second-quarter earnings.

Privatecapital is willing and able to take on that risk, the CEO said. Sinks referred toa federal study that showed that more than a third of the FHA's recent businesswent to customers with FICO scores higher than 680.

"Thatis not the role that our government should be playing," he said.

An annualpremium reduction would mainly affect business for customers with credit scoresbelow 700, a segment that represents about 16% of MGIC Investment's new policies,he said.