Consequently we do not view the FHA premium reduction as a major setback, but more in line where the pricing differential was a decade ago. Providing a private sector alternative to government insurance is one of the principles that Max Karl founded our company and this industry on and as the largest provider of the government insurance the FHA has always been our largest competitor through the 40 years I have been in the business. This price reduction by the FHA is just another change to the ever changing housing finance system.
As a reminder, in the late 1990 and early 2000s FHA was priced at 50 basis points annually and 125 basis points upfront versus the 80 basis points and 175 basis points structure that will result from the price reduction, and our industry captured nearly two-thirds of that insurable market back then. That was accomplished because we were able to demonstrate that we had a better value proposition for both lenders and the majority of low down payment borrowers and these value propositions are even more favorable today. So as I said earlier, let’s get on with the competition.
Overall with 30 year mortgage rates remaining affordable and an improved employment situation we expect a relative healthy purchase market in 2015. Considering current marketplace dynamics we expect to write a slightly higher volume of business in 2015 than we did last year. We could see a materially higher level of NIW if refinances are stronger than we expect.
Currently our purchase application pipeline remains robust, running approximately 30% higher than a year ago and we have seen a pick-up in refinance transactions moving closer to 20% from the low teens throughout most of 2014. Insurance in force grew nearly 4% as a result of increased levels of new insurance written and higher persistency to end the year at a $165 billion. At quarter end approximately 61% of our insurance in force was covered by reinsurance transactions.
During the quarter in total the reinsurance transactions had the effect of reducing net income by approximately $10 million. At quarter end cash and investments totaled $4.8 billion, including $491 million of cash and investments at the holding company. Our total annual interest expense is approximately $66 million and our next scheduled debt maturity is $62 million due in November 2015.
Now let me take a couple of minutes to discuss the regulatory environment. We are still waiting for the final decision regarding the GSE’s mortgage insurance eligibility requirements or PMIERs. We currently expect these rules to be finalized and published no earlier than the end of this quarter. We don’t really know what if any changes the FA and the GSEs will make regarding the various balance recommendations that we and others made, but the comments we have heard were positive to our industry.
As we talked last quarter it’s important that the capital rules provide the GSEs with strong counterparties and apply a risk based methodology, but they should also achieve the public policy goals of expanding access to credit for creditworthy borrowers, decreasing the government footprint in housing and reducing taxpayer exposure by encouraging private capital to take a first loss position on residential mortgage credit.
