U.S. Mortgage Insurers (USMI), the association that represents the nation’s leading private mortgage insurance companies, announced on Wednesday that it has named Seth Appleton, current president of the Mortgage Industry Standards Maintenance Organization (MISMO), as USMI’s new president. Appleton will assume the new role in January 2023.
“With a deep knowledge of the mortgage industry and a proven record of bipartisan advocacy, Seth is the right leader to promote the mission of the private mortgage insurance industry in helping first-time homebuyers achieve the American dream of homeownership,” USMI’s board chairman Adolfo Marzol said in a press release.
Appleton, who currently serves as co-chair of the Bipartisan Policy Center’s Housing Council and previously served as Assistant Secretary for Policy Development and Research at the U.S. Department of Housing and Urban Development (HUD), has a history of working across the aisle to deliver results, according to a press release from USMI.
Appleton was also a key player in the passage of the Obama-era reauthorization legislation, which reformed housing policies for the first time in decades and was unanimously passed by Congress.
“Seth’s diverse experience in senior roles at HUD, Ginnie Mae, MISMO, and on Capitol Hill stand out. He knows how to collaborate to get things done in Washington, and we are excited to bring his proven leadership to USMI,” Marzol said.
Appleton is joining USMI in the midst of widespread housing market turmoil, which has been caused by a perfect storm of higher-than-average mortgage rates, record-low housing inventory and high home prices. Fears of a prolonged recession have further exacerbated the issues the industry is facing.
While 2020 and 2021 were banner years for the industry, potential home buyers have largely held off on applying for mortgage loans in recent months due to increased loan rates and a pervasive lack of inventory in nearly every market that has helped to keep home prices high.
As of mid-December, the average 30-year fixed loan mortgage rate hovered above 6%, down slightly compared to the months prior, but still a significant increase compared to last year’s sub-3% rates. With home buyer budgets stretched thin, home sales have declined significantly, causing housing industry profits to dwindle. In turn, widespread layoffs and closures have occurred throughout all facets of the industry.
Several notable industry stakeholders have also called on FHA Commissioner Julia Gordon to reduce mortgage insurance premiums to promote affordability. The FHA’s MMI Fund achieved a capital reserve ratio of 11.11% as of September 30, an increase of three percentage points compared to 2021.
Any MIP cuts would be part of the 2023 budget process in Congress, and that’s been a frustration for Gordon.
“It’s harder to change the MIP for single-family home loans than you might think,” Gordon recently said at the National Housing Conference.
In public statements, the USMI has called on the FHA to “maintain a prudent approach” to pricing and risk management.
“FHA should protect the short- and long-term financial health of the MMIF and position itself to support the market through the economic cycle,” the group said last month.
In a statement, Appleton said he is honored “to join the private mortgage insurance industry at a time when sustainable low down payment lending – backed by private capital – is so important to borrowers and the entire housing finance system.”
“Over 37 million low down payment borrowers have gained access to affordable and sustainable mortgage financing by utilizing private mortgage insurance. This track record of serving borrower needs while reducing risk to the housing finance system is the foundation for broad bipartisan support for the role of private MI,” Appleton said.
“As USMI President, I look forward to communicating the value of private MI in unlocking the opportunity to buy a home for millions of additional families in the years to come, while at the same time providing safety and soundness for the housing finance system.”