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From HW Magazine

2015 Trailblazers: Arch MI

Providing a competitive edge to attract Millennial borrowers

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In the competitive mortgage market of 2016, lenders will differentiate themselves through the quality and scope of services they provide, including mortgage insurance. Originators need an MI provider that can meet a broad range of needs with solutions that will help them compete.

“With our commitment to real innovation — Arch MI RateStar and Arch Mortgage Guaranty Company, for example — Arch MI has proven itself to be the partner that can transform and expand lending horizons,” David Gansberg, president and CEO of Arch MI, said.

That transformation is especially critical for lenders trying to attract Millennials. This generation, the largest in U.S. history, continues to lag behind others in home purchases but is vital to the long-term health of the housing market, so lenders have no choice but to continue to woo them aggressively.

Millennials are wary about applying for mortgages because of the recent recession and the job market, which continues to struggle in many parts of the country. Consequently, this generation is particularly sensitive to the costs involved in a home purchase. 

“The expectations of Millennials also differ in some ways from their predecessors,” Gansberg said. “Conditioned by technology since childhood, they are focused on speed, convenience and service that recognizes their individuality.”  

“Arch MI can help lenders to meet these expectations and address Millennials’ price-sensitivity with solutions that give them a crucial competitive edge with this segment.”

New RateStar, which will roll out in early December, is a prime example of that kind of solution, since the risk-based pricing program takes a more targeted approach than the conventional rate sheets used for decades in the industry. 

Arch1Mortgage insurance premium rates are priced based on each loan’s individual risk attributes and the RateStar model can find unique combinations as well as ranges of difference within those attributes on which to price even more precisely.

The result is that RateStar rewards the origination of higher-quality loans, both for the lender and the borrower. 

“In many cases, our risk-based model enables lenders to reward creditworthy borrowers with lower monthly payments. RateStar goes well beyond ordinary industry rate sheets and is able to match Arch MI premium rates precisely to the individual loan, based on the risk represented by the loan,” Gansberg said.

RateStar also offers lenders a hassle-free user experience. Its simple, intuitive design and cross-platform accessibility make RateStar an easy-to-use tool for obtaining competitive MI rates and shortening turnaround times.

“RateStar Final Quotes are guaranteed by our 90-Day Promise, which gives the lender 90 days to prepare the loan for closure and submit the loan for insurance commitment. So long as there is no change to the submitted loan information, Arch MI will honor the quoted rate unless prevented by law,” Gansberg said.

Transitioning to RateStar requires minimal process changes for lenders. It is accessible not only on Arch MI’s website and origination platform, ArchMIConnect, but is seamlessly integrated with most industry loan origination systems and pricing engines. In addition, RateStar is available on the Arch MI Mobile App. 

To use RateStar, Arch MI customers enter specified loan characteristics and quickly obtain a rate quote. They can then save, share or print the quote for future reference and view side-by-side comparisons to pick an MI option that’s best for their borrower.  

“We believe that the launch of RateStar, representing a new generation of risk-based pricing in the industry, is a major step forward by Arch MI. We anticipate that RateStar will be embraced by mortgage originators because of the competitive advantages it brings to their businesses and the ease of its implementation,” Gansberg said.“This broad market adoption will enable Arch MI to insure more loans and establish itself as a leader in industry innovation.”

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