# VA Administrative Letter 1981-12: Mortgage Guaranty Insurance on Variable Rate Mortgages, issued September 11, 1981 > Virginia · Agency guidance · In force URL: https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-12 ## Section - **Citation:** VA Administrative Letter 1981-12 - **Heading:** Mortgage Guaranty Insurance on Variable Rate Mortgages, issued September 11, 1981 - **Jurisdiction:** Virginia - **Kind:** Agency guidance - **Status:** In force - **Text as of:** August 14, 2026 - **Source:** Compiled text - **Location:** Virginia SCC Bureau of Insurance Administrative Letters / Mortgage Guaranty Insurance on Variable Rate Mortgages, issued September 11, 1981 ## Text JAMES W. NEWMAN, JR. COMMISSIONER OF INSURANCE W. G. FLOURNOY FIRST DEPUTY COMMISSIONER COMMONWEALTH OF VIRGINIA BOX 1157 RICHMOND, VA. 2320 TELEPHONE (804) 786-. # STATE CORPORATION COMMISSION BUREAU OF INSURANCE September 11, 1981 Administrative Letter 1981-12 TO: All Mortgage Guaranty Insurance Companies Licensed in Virginia The purpose of this letter is to clarify and expand on two issues addressed in Administrative Letter 1981-9. The concern that my staff and I have about mortgage guaranty insurance on variable rate mortgages is primarily directed toward negative amortization and its effect on credit risk. Therefore, I want to modify the blanket directive contained in Administrative letter 1981-9 regarding insurance on all types of variable rate mortgages. Effective immediately, any Virginia licensed mortgage guaranty insurance company may insure variable rate mortgages provided there is no potential for negative amortization of the loan balance and provided there has been appropriate filing of rates, rules and forms for such insurance. This policy will allow the mortgage guaranty insurance companies to continue to serve the traditional market as well as a portion of the variable rate mortgage market. In my previous letter, I requested a written statement regarding your views on the adjustable rate mortgage and negative amortization issues. In order to assist my staff in researching these problem areas and developing policy options, I again request that if you have not yet provided us with written statements regarding your analysis of the problems and available options, please do so. Because I want to resolve this in a timely manner, I ask that you respond within two weeks of receipt of this letter. I sincerely appreciate your prompt attention to this request. James W. Newman, Jr. JWNjr/dj ## Nearby sections - [VA Administrative Letter 1979-20 Adoption of Actuarial Guidelines by the Bureau of Insurance, issued August 14, 1979](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1979-20.md) - [VA Administrative Letter 1979-21 Adoption of Actuarial Guidelines for Domestic Life Insurance Companies by the Bureau of Insurance, issued August 14, 1979](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1979-21.md) - [VA Administrative Letter 1981-09 Mortgage Guaranty Insurance Policies, issued August 19, 1981](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-09.md) - [VA Administrative Letter 1981-10 Risk Sharing Arrangements, issued August 13, 1981, § 38.2-1314 (formerly § 38.1-173)](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-10.md) - [VA Administrative Letter 1981-12 Mortgage Guaranty Insurance on Variable Rate Mortgages, issued September 11, 1981](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-12.md) - [VA Administrative Letter 1981-14 Mortgage Guaranty Insurance on Variable Rate Mortgages Allowing Negative Amortization, issued September 30, 1981](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-14.md) - [VA Administrative Letter 1982-10 Motor Vehicle Service Contracts, issued May 1982, §§ 38.2-124 and 38.2-125 (formerly § 38.1-21)](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1982-10.md) - [VA Administrative Letter 1983-07 Property and Casualty Rule, Rate and Form Filings: Life, Accident and Sickness and All Other Filings Required by Section 38.2-316 (formerly § 38.1-342.1) of the Code of Virginia, issued October 19, 1983](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1983-07.md) - [VA Administrative Letter 1987-04 Appointment of the Clerk of the Commission as Agent for Service of Process, issued March 13, 1987, § 38.2-1216](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1987-04.md) - [VA Administrative Letter 1990-14 Clarification of Virginia Insurance Code Section 38.2-4904 - Annual Disclosure Statements, issued August 17, 1990, § 38.2-4904](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1990-14.md) - [VA Administrative Letter 1990-15 Allocation of Group Premiums for Multijurisdictional Health Maintenance Organizations, issued October 1, 1990, § 38.2-400](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1990-15.md) - [VA Administrative Letter 1991-07 Contingency Reserve Funding Level Required by the Rules Governing Group Self-Insurers of Liability Under the Virginia Workers' Compensation Act (14 VAC 5-370-10 et seq., formerly Insurance Regulation No. 16), issued April 23, 1991](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1991-07.md) - [VA Administrative Letter 1992-06 Prohibition Against the Payment or Receipt of Title Insurance Kickbacks Rebates, Commissions and other Payments, issued February 19, 1992, §§ 38.2-509 and 38.2-4614](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1992-06.md) - [VA Administrative Letter 1993-06 Installment Payment Plans, issued May 3, 1993](https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1993-06.md) --- Source: Frix Law Library, https://www.frixlaw.com/law-library/statutes/VA_INS_AL_1981-12. Check the current official text before relying on it. Not legal advice.