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Impac Enhances No MI Program
By James Comtois
After the recent tightening of the second trust deed mortgage market and increases in state requirements, Newport Beach, Calif.-based REIT Impac Mortgage Holdings, which specializes in subprime and Alt-A loans, has enhanced its pricing and loan amounts on its No Mortgage Insurance program for single loans.
As part of this enhancement, through its No MI program, Impac is offering a single payment and lower closing costs for borrowers, which the company believes will also provide more profit potential for brokers and bankers.
Gregory Davis, senior vice president and director of national sales for Impac subsidiaries Impac Funding Corp. and Impac Lending Group, said in a statement "it was time to step forward as a responsible lender to move back towards single loans.
"By moving back to single loans, versus combo loans, we are lowering the cost of origination and streamlining the loan process, which creates a benefit for the borrowers and more profit potential for brokers and bankers. Single loans offer borrowers the convenience of a single payment, as well as lowering costs," Mr. Davis added.
Impac's enhancements to the No MI program include pricing competitive with combo pricing and larger loan amounts, including 100% financing to $1 million.
"Brokers and bankers benefit from increased profit potential due to the lower cost of origination, streamlined loan process and premiums [that] are based on larger loan amount on a single first trust deed, rather than having a second trust deed, which are typically subsidized in order to get the business," said Mr. Davis.
Separately, this news shortly follows the release of the company's second quarter earnings, which reported 2Q06 net earnings of $26.4 million, compared to a net loss of $55 million in the same period a year prior. The mortgage operations acquired and originated $2.2 billion of primarily Alt-A mortgages in the second quarter of 2006, up from the $2.1 billion for the first quarter of 2006 but down from the $5.5 billion for the second quarter of 2005.
Impac's commercial mortgage operations originated $277.9 million of commercial mortgages compared to $202.8 million for the first quarter of 2006 and $214.6 million for the second quarter of 2005.
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