http://The PMI Group, a leading mortgage insurer, has filed for Chapter 11 bankruptcy, following the rejection of a bid to overturn the seizure of its mortgage insurance unit in October by state regulators. The company is looking forward to getting protection from its creditors, in the US Bankruptcy Court, mentioning debts of $736 million against assets of $225 million. PMI, once among the largest private sector mortgage insurers in the US, has witnessed an exponential decline in its business, owing to the situation in the Us housing market, despite the lowest mortgage rates being prevalent.
According to the court papers, the company was working on a transaction that could have used the unit seized by Arizona regulators, i.e., PMI Mortgage Insurance Co., to write new mortgage insurance across the country. A subsidiary, PMI Mortgage Assurance Co., was slated to take control of the former’s operating system, an arrangement that would have resulted in new capital investment that would have funded the business. However, this strategy met with a brutal ending, as the Arizona Department of Insurance seized the mortgage-insurance unit in October. PMI tried to stop this takeover by mentioning that the state has not followed proper procedure when a court order was procured last month, allowing the state to run the mortgage insurer till a receiver could be appointed. However, as per a court order release on Tuesday, PMI’s mortgage subsidiary is ‘currently insolvent’ and its own financial forecasts of the company’s health can’t be treated as legitimate, resulting in the developments.dev2.ratecomb.com/blog/wp-admin/edit.php?post_type=page