KIRO Radio's Tom Kelly digs deep into the Puget Sound real estate market
Real Estate

Mortgage insurers fined over alleged kickbacks

The Consumer Financial Protection Bureau has fined four of the nation's largest mortgage insurance providers for alleged kickbacks to lenders in order to win more business, a practice the agency says has been going on for more than a decade.

The agency says the practice inflated borrowers' costs because home owners were given policies that were based on business relationships and not competitive pricing.

The four mortgage insurance providers have been fined $15.4 million by the agency.

The four companies fined by the agency are Genworth Financial Inc., American International Group Inc.'s United Guaranty unit, Radian Group, and MGIC Investment Corp. The companies did not admit or deny any wrongdoing with the allegations. They said their relationships complied with federal law.

The CFPB is also investigating lenders who took part, and they may soon face fines as well, The Wall Street Journal reported.

"In every kickback situation, there's somebody paying and there's somebody receiving," said Kent Markus, the CFPB's assistant director of enforcement. "We have more work to do on this matter."

Mortgage insurance is usually required when homebuyers purchase homes with down payments of less than 20 percent.

Top Stories

  • Devastating
    The mother of an alleged high school rape victim speaks out

  • Tarnished Park
    Recent crimes have Dori worried about the state of one of his favorite Seattle parks

  • Plagued by Problems
    Ferry woes have added up this year with canceled routes, overcrowding & staff issues
ATTENTION COMMENTERS: We've changed our comments, but want to keep you in the conversation.
Please login below with your Facebook, Twitter, Google+ or Disqus account. Existing MyNorthwest account holders will need to create a new Disqus account or use one of the social logins provided below. Thank you.
comments powered by Disqus
Listen to the show
Hear Real Estate Today on KIRO Radio
Join Tom Kelly every Sunday at 9am on KIRO Radio to talk Puget Sound real estate.

Sign up for breaking news e-mail alerts from MyNorthwest.com
In the community
Do you know an exceptional citizen who has impacted and inspired others?
KIRO Radio and WSECU would like to recognize six oustanding citizens this year. Nominate them to be recognized and to receive a $2,000 charitable grant.