Answer:
It's a safety & soundness consideration. Your regulator may include loans of this type in the loan classifications & allocate capital to cover the excess risk.
First published on BankersOnline.com 09/16/02
PMI Requirements
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Question:
If we make a mortgage loan that we are going to hold and service and the loan to value is in excess of 80%, are there any regulations that require us to cover that loan with private mortgage insurance? Or is that simply a bank policy issue that goes to loan quality?
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