HCS SB 804 -- MORTGAGE INSURANCE AND INVESTMENTS
SPONSOR: Yeckel (Liese)
COMMITTEE ACTION: Voted "do pass" by the Committee on Banks and Financial Institutions by a vote of 21 to 0.
This substitute increases the maximum allowable amount of mortgage insurance coverage from 97% to 100% of the fair market value of the property.
The substitute also excludes evidences of debt that are direct obligations of, guaranteed by, fully collateralized by, or issued by the Student Loan Marketing Association, Federal Home Loan banks, or the Federal Farm Credit Bank from the calculation of investment limits for state-chartered banks and trust companies. Further, savings and loan associations may invest in stock or obligations of the Student Loan Marketing Association, Federal Home Loan banks, or the Federal Farm Credit Bank.
The portion of the substitute dealing with investments contains an emergency clause.
FISCAL NOTE: No impact on state funds.
PROPONENTS: Supporters say that allowing mortgage insurance for 100% of the property value will help home buyers who cannot afford a down payment. The practice is common in most other states.
Testifying for the bill were Senator Yeckel; Missouri Bankers Association; Mortgage Bankers Association; and G.E. Mortgage Insurance Company.
OPPONENTS: There was no opposition voiced to the committee.
Terry Finger, Senior Legislative Analyst