How did I miss this?
Discovery should be pretty interesting.
I don’t seem to be able to post the document, but this quote is interesting:
Since the 1980s, United Guaranty has used a delegated model for underwriting. Underwriting is the process whereby an insurer determines the risk associated with a loan and decides whether to offer insurance. Under the delegated model, United Guaranty does not underwrite each loan itself. Instead, it relies on the lender to accurately represent information on the loans to be insured. For example, the lender may represent that the loans satisfy certain underwriting guidelines such as minimum credit scores or maximum loan-to-value ratios. Based on the lender’s representations, United Guaranty then decides whether to offer insurance. This model is efficient, cost-effective, and preferred by many lenders.
Hindsight, of course, is 20/20 vision, but this might explain a lot — or maybe it’s that investigative reporters are predisposed to think that trust is not a good business plan.