Among the companies hit hardest by the housing downturn are the mortgage insurance firms. These companies insure conventional mortgages for banks so that if the home forecloses the bank can collect to trim its losses. The problem is that a lot more homes are foreclosing now than anyone anticipated a few years ago and the insurance companies are taking a beating as a result. See this article on the latest news related to this subject:
Mortgage insurer PMI Group Inc reported a much wider-than-expected quarterly loss, as its U.S. unit continued to post disappointing results, sending its shares down 5 percent before the bell.
The company posted a loss of $228.2 million, or $2.76 a share from continuing operations for the latest fourth quarter, compared with a loss of $181.0 million, or $2.22 a share, a year back.
From the perspective of consumers the problem is that these sorts of things ultimately make it harder to get approved for refinances or other home loans.