* Ruling gives MBIA access to borrower job information
* MBIA hopes to prove underwriting breaches
* MBIA seeks similar data in related case
WILMINGTON, Del., May 10 (Reuters) - An MBIA Inc (MBI.N) insurance unit can demand job and income data on mortgage borrowers at a unit of Ally Financial Inc GKM.N, a move it hopes will help it prove it was fraudulently induced to insure billions of dollars of mortgage bonds.
In a ruling made public on Tuesday, New York State Supreme Court Justice Bernard Fried allowed MBIA, once the world's largest bond insurer, to issue subpoenas to employers of borrowers who took out mortgages with Ally's Residential Funding Co unit.
MBIA hopes to find added ammunition that will enable it to prove Residential Funding breached its obligations on five mortgage securitization transactions that MBIA insured.
It contends that Residential Funding made loans that did not conform to its underwriting guidelines.
Ally did not immediately return a call for comment.
Many of the loans were second-lien mortgages and "stated income" loans, which often require little documentation from borrowers and proved among the most toxic during the nation's housing crisis.
MBIA had argued that Residential Funding was nonetheless obligated to prove that borrowers' stated income and employment status was reasonable, given where they lived and what their occupation was.
The bond insurer had paid out $871 million in claims on the securities as of March 2010, court documents show.
MBIA was restructured by New York's insurance department in February 2009, a process now being challenged by 11 banks and other financial institutions before the state's highest court.
MBIA has a similar subpoena request in a different New York case before a different judge against Countrywide Financial Corp, which is now a unit of Bank of America Corp (BAC.N).
The bond insurer cited what it said were examples of nonconforming stated income loans in court documents. In one, a borrower in Scottsdale, Arizona, stated income of about $132,000 annually, despite having assets of only $11,491.
The same borrower later claimed in a bankruptcy filing that the 2006 income was only $43,523 and the bank account used to verify the borrower's reserves was revealed to be held in the name of the loan officer.
The case is MBIA Insurance Corp v Residential Funding Co, New York State Supreme Court, New York County, No. 603552/2008. (Reporting by Tom Hals; Editing by Tim Dobbyn)