Genworth Insured Mortgage Products

BUSINESS FOR SELF (ALT-A)

With a strong emphasis placed on reasonability of income type, amount, and durability, Self-Employed borrowers and Commissioned Sales people that cannot provide traditional income verification may now qualify for a high ratio mortgage for purchase or refinance purposes.

Acceptable loan purpose:

Loan-to-value ratio limits:

Maximum Loan Amounts:

Eligible properties:

Occupancy:

Amortization options:

Terms/qualifying interest rates:

Borrower qualification:

Self employed borrowers:

Commissioned sales:

Premium rates:

Premium matrix:

Portability:

Example for Scenario #3:

Outstanding mortgage balance = $100,000; Top-up mortgage amount = $80,000; New Loan Amount = $180,000 (90% LTV)

Assumptions/assignments:

Ineligible loan purpose/type:

Documentation/information requirements:

HOMEBUYER 100 Program (No Downpayment Financing)

Genworth will now be providing mortgage insurance on an innovative new program accessible to qualified homebuyers with no down payment.

Acceptable loan purpose

Loan-to-value ratio limits

Eligible properties

Terms/qualifying interest rates

Amortization options

Coverage

Premium rates*

Borrower qualification

Documentation requirements

Portability

Assumptions/Assignments

Eligible Products **

** For specific underwriting guidelines related to the above eligible products, please refer to the applicable product overview

Ineligible Products

INVESTMENT PROPERTY PROGRAM

Genworth will now be providing mortgage insurance on an innovative rental program accessible to qualified borrowers with as little as 10% down payment.

Acceptable loan purpose

• Purchase
• Purchase Plus
• Refinance (Maximum Equity Take-out: $200,000)

Eligible properties

• Maximum four units
• New construction or existing properties
• Property must meet the following criteria:
  • Municipal zoning
  • Fully self-contained units
  • Remaining property (economic) life must equal or exceed the amortization of the loan

Ineligible Property Types

• Time-share Interests
• Vacation Homes
• Commercial zoning
• Rooming Houses
• Quarter Share / Shared Ownership
• Rental Pools

Maximum Loan-To-Value

• 90% LTV (Purchase or Refinance)

Terms/Qualifying Interest Rates

• For terms less than 3 years, the qualifying interest rate is the greater of three-year posted rate or contract rate
• For terms of three years or more, the contract rate is used
• Fixed, variable and adjustable rate mortgages permitted.

Portability

• Mortgage default insurance is portable under this program
• The premium will be calculated using the lesser of:
  1. The Premium on the Total Loan Amount less applicable Premium Credit or
  2. The Premium on the Top-Up Portion as per the table above

When porting from an existing standard Genworth insured loan to an Investment Property there is a 2% conversion rate, the premium will be the lesser of:

• The outstanding mortgage balance multiplied by 2.0% + the top-up amount multiplied by the top-up premium rate, or
• The new loan amount multiplied by the full premium rate

Maximum Amortization

• 40-years (A 20 bps premium surcharge will apply for every 5 years of amortization beyond 25-years)

Application Fee

• $0

Borrower Qualification

• Maximum 40% TDS
• TDS = PIT+ Other Monthly Obligations - (Rental Income x 80%)
                                     Qualifying Income Of Applicants
• PIT: Also include 50% of condo fees
• Rental Income
  • The lesser of actual rent or fair market rent as determined by an approved appraiser
  • Income from a non-conforming basement suite will be considered on an exception basis
• Down payment from borrower's own resources
• Personal guarantees are required when the borrower is not an individual (e.g. corporate entity).
• The personal guarantee can not be released without prior consent from Genworth

Recommended Credit Profile

• Borrowers should have a strong history of managing their credit
• Two (2) trade lines with at least two (2) years history
• No prior bankruptcy
• Purchase: credit scores 660 or greater
• Refinance: credit scores 680 or greater
• Genworth will consider applications with lower scores based on the overall merit of the application and where other risk mitigating factors exist.

Assumptions/Assignments

• Mortgages issued under this product are assumable provided the new covenant meets all product qualifications and guidelines
• Insurance coverage will continue in the event of a sale of the mortgage to an investor provided that servicing continues with a Genworth approved lender in compliance with Master Policy terms.

Other Investment Properties

• When a borrower is purchasing an investment property, but currently owns other investment properties, the rental income needs to be confirmed with recent T-1 Generals.
• If there is a rental surplus - The surplus amount can be added in as "Other Income"
• If there is a shortfall - The shortfall amount must be added to "Other Monthly Obligations" and included in the TDS calculation.
• Where rental income cannot be validated with T-1 Generals, the full Principal, Interest, and Taxes must be included in "Other Monthly Obligations", and 50% of gross rental income can be added to "Other Income".

Documentation Requirements (To be kept on file by the lender)

• Offer to purchase
• Income confirmation
• T1-Generals (As required)
• Down payment confirmation

Appraisal Requirements

• To be completed by a Genworth approved appraiser
• Full and standard service acceptable

Ineligible Loan Types/Products

• CreditAssist
• Business for Self (ALT A)
• New to Canada
• Progress Advance
• Family Plan
• Cashback Equity
• Vacation Properties
• Homebuyer 100
• Second Mortgages

CASH-OUT REFINANCE

Introduced to Canadians by Genworth, this program enables borrowers to take equity out of their homes for a variety of purposes, including asset enhancement, debt consolidation, combining a first and second mortgage, or renovations.

Acceptable loan purpose

• Refinance transactions for repayment of existing financing, debt consolidation, renovation & asset enhancement (this product replaces all other refinance products)
• Renovation loans with multiple advances are acceptable; up to four advances managed by lender

Equity removal limits

• We limit equity removal to $200,000 (except when the loan purpose is to consolidate existing first and second mortgages, in which case the maximum LTV ratios will apply) 
• 90.01-95% LTV; equity removal is limited to $150,000 

Loan-to-value ratio limits

'Loan-to-value' (LTV) is the relationship between the principal balance of a mortgage and the property value. For example, if you have a house valued at $100,000 with a $90,000 loan, you have a 90% LTV ($90,000 divided by $100,000 = 90%).

• 1 – 2 units: 95% LTV
• 3 – 4 units: 90% LTV
• Secondary Homes: 90% LTV
• Investment Properties: 90% LTV

Eligible properties

• Owner Occupied:
  • Maximum four units with at least one unit occupied as the principal residence
  • Existing properties (not for new construction)

• Secondary Homes:
  • Maximum 2 units
  • Maximum 90% LTV
  • Investment Properties:
    • Maximum 4 units
    • Maximum 90% LTV

Terms/qualifying interest rates

• Fixed, standard variable, capped variable and adjustable rate mortgages are permitted
• Qualifying interest rate: the contract rate or the three year rate if the term is less than three years

Coverage

• 100% coverage.
• For renovation loans, insurance coverage will be effective for any lender-managed advances (up to 4) provided proper confirmation of work completed is documented and on file.

Amortization options

• Available for extended amortizations up to 40 years
• If a full premium is paid on the entire mortgage the amortization can be up to 40 years (i.e., currently uninsured conventional mortgages)
• Home owner can keep the same amortization remaining on the existing mortgage
• Blended amortization (based on a weighted average of the original mortgage amortization and up to 40 years for the increased mortgage amount). Use our Refinancing calculator to find out more about blended amortization
   

Premium rates*

The new premium payable will be the lesser of the premium as a % of the total new loan amount or the premium as a % of the top-up portion from the current loan amount

There is no premium surcharge for a blended amortization.

* a .20% premium surcharge will be applied to the above premium rates for every 5 years of amortization beyond the traditional 25-year mortgage amortization period
 

Borrower qualification

• A minimum credit bureau score of 600, (excluding applications on currently insured Genworth mortgages which are reviewed on a case by case basis)
• A minimum credit bureau score of 650 is required for 95% LTV 
• No prior bankruptcy or judgements
• No R3's in the past 24 months
• Mortgage is assumable  
• Non-residing guarantors are not permitted. Non-residing co-borrowers are acceptable (must be an immediate family member and on title).
• All other existing requirements related to income and credit worthiness apply

Documentation/information requirements

• Employment and income verification required upon request
• To improve turn-around time please include the following in the comments section:
  1. Existing Genworth reference number (if applicable)
  2. Amount of new money being advanced
  3. Outstanding balance of existing mortgage

Eligible Products **

• Alt A
• CreditAssist
• First Mortgage Owner Occupied 1 and 2 units
• First Mortgage Owner Occupied 3 and 4 units
• Extended amortizations up to 40 years
• HELOC
• Secondary homes (Type A)
• Investment Property Program

** For specific underwriting guidelines related to the above eligible products, please refer to the applicable product overview

Ineligible Products

• Cashback Equity
• Family Plan
• Homebuyer 100
• Insured Progress Advance
• New To Canada
• Purchase Plus
• Vacation homes (Type B)

The insurance premium is paid once at the time of closing . The insurance premium is not refundable and may be added onto the mortgage

NEW TO CANADA PROGRAM

Now qualified homebuyers who have immigrated or relocated to Canada can qualify for Genworth default mortgage insurance with as little as a 3% down payment.

Acceptable loan purpose

• Purchase transactions

Loan-to-value ratio limits

• Maximum LTV ratio - 97.00%

Eligible properties

• Maximum two units where at least one unit must be occupied as the principal residence
• New construction or existing properties

Terms/qualifying interest rates

• Fixed, standard variable, capped variable and adjustable rate mortgages are permitted
• For terms less than 3 years, the qualifying interest rate is the greater of three-year posted rate or contract rate; for terms of three years or more, the contract rate is used

Premium Rates

Borrower qualification 

• Must have immigrated or relocated to Canada within the last 36 months
• 3 months minimum full time employment in Canada (borrowers being transferred under a corporate relocation program are exempt)
• Must have a valid work permit or obtained landed immigrant status
• For LTV's 95% or greater, down payment must be from own resources. For LTV's less than 95%, the remainder may be gifted from an immediate family member or from a corporate subsidy. 
• All debts held outside of the country must be included in the total debt servicing ratio (Rental income earned outside of Canada is to be excluded from the GDS/TDS calculation)
  
   

Documentation Requirements (To be kept on file by lender)

Note: This program is not available to Diplomats or any other foreign political appointed individuals who do not pay income tax in Canada.

Eligible Products **

• Extended amortizations up to 40 years
• First Mortgage Owner Occupied 1 & 2 units
• Purchase Plus Improvements

** For specific underwriting guidelines related to the above eligible products, please refer to the applicable product overview

Ineligible Products

• Alt A
• Cashback Equity
• Cash - Out Refinance
• CreditAssist
• Family Plan
• First Mortgage Owner Occupied 3 & 4 units
• HELOC
• Homebuyer 100
• Insured Progress Advance
• Vacation/Secondary
• Investment Property Program

The insurance premium is payable once at the time of closing (except for Progress Advances where the premium is paid in installments during the construction phase with a final installment paid when the home is completed). The insurance premium is not refundable and may be added onto the mortgage or paid in cash.

VACATION/SECONDARY HOMES

At Genworth, we know that today's busy lifestyle requires more home ownership options - whether it's a second home in the city to reduce that weekly commute, or a cottage at the lake for weekend getaways. With our recently enhanced Vacation/Secondary Home Program, Canadians can now purchase a second home with an affordable monthly payment and with little or no money down.

Acceptable loan purpose

• Secondary homes (Type A) available for purchase and refinance
• Secondary homes (Type A) available for Home Equity Line of Credit (HELOC)
• Vacation homes (Type B) available for purchase only 
• Program does not provide for the purchase of investment, rental pool or timeshare properties; therefore, incidental rental income will not be used for qualification purposes.

Eligible properties (Refer to the Property Type Schedule)

Type A Properties (Secondary Homes):

• Property characteristics must comply with the Genworth First Mortgage Owner Occupancy Program
• Maximum loan amount: - Metro Toronto, Metro Vancouver and Metro Calgary - $700,000; rest of Canada - $600,000
• Up to two units Maximum
• Available for purchase and refinance

Type B Properties (Vacation Homes):

• Property characteristics same as Type A properties except for the following;
• Property need not be winterized
• May have seasonal access (road not plowed during winter)
• Maximum loan amount:  $350,000 (exceptions will be considered on a case by case basis)
• One unit maximum
• Available for purchase only 

Loan-to-value ratio limits

• Type A properties: 100% LTV (Purchase) and 90% LTV (Refinance)
• Type B properties: 90% LTV (Purchase)

Portability

• Mortgage default insurance in this program is portable. We calculate portability premiums according to the Genworth portability program, using the port top-up premiums that you will see below
• If the property is a Type B and the original mortgage was a Type A, the difference in the insurance premiums is 0.75%. This is charged on the mortgage balance being ported, in addition to the top-up premium. You can find further details on this in our Portability Product overview.
• Mortgage is assumable

Premium Rates

Portability top-up rates:

Borrower qualification

• For 95.01% - 100% LTV: please refer to Homebuyer 100 Product Overview and Homebuyer 97 Product Overview for qualifying criteria 
• For Alt. A applications, please refer to Alt. A Product Overview
• We require a minimum credit bureau score of 650 on all applicants for Vacation (Type B) properties. We calculate the score using our internal Genworth proprietary scoring model, which uses credit scores from both bureaus. Please note that on a case-by-case basis, we are prepared to review instances where the primary applicant meets the minimum credit score but a second applicant has no credit at all
• No prior bankruptcy or judgements
• No R3's in the last 24 months
• Maximum of one Genworth-insured vacation property per applicant
• No 3rd party guarantors for qualification purposes. We do accept spousal guarantors
• Gifted down payments are acceptable for Secondary and Vacation "A" properties providing the applicants meet the qualifying criteria for Homebuyer 100 and/or Homebuyer 97 products
   

Terms/qualifying interest rates

• Six months up to 25 years - Fixed, standard variable, capped variable and adjustable rate mortgages are permitted
• For terms less than three years, the qualifying interest rate is the greater of three-year posted rate or contract rate
• For terms of three years or more, we use the contract rate

Documentation requirements

Electronic applications are processed without documentation, unless requested.  If paper-based, we required the following:

• Offer to purchase
• Employment/income verification
• Verification of down payment

Appraisal requirements

Turnaround times in this program are outside the standard purchase business levels. Property specifications

Type A property:

• Foundation must be permanent and installed beyond the frost line. This includes concrete/concrete block or preserved wood foundations certified by a professional engineer or post/pier foundations on solid bedrock
• Must be zoned and used as residential, rural or seasonal. We do not accept mixed uses or rental pooling
• Freehold or condominium title. We do not accept co-ops or ¼ interest ownership
• At minimum, property must have a kitchen, 3-piece bathroom, bedroom, and common area
• Remaining economic life must be 25 years
• Year-round road access on reasonable quality public roads, serviced by the local municipality. We also allow privately serviced roads, provided there is a maintenance contract in place
• Property must be winterized with a permanent heat source. For example, heating can be baseboard, forced air, water radiator, radiant, coal, propane, geothermal heat pumps, or heat pumps
• Good quality construction with no signs of deferred maintenance
• Water source: well, municipal serviced, and cistern. Water source must be drinkable. We accept lake or river water, provided the property has its own filtration system. For example, a reverse osmosis system
• There must be good market appeal in the area with no adverse influences/neighbourhood nuisances

Type B property:

All Type A property requirements apply to Type B, except for the following:

• No permanent heat source is required. For example, a wood stove, fireplace, stove or heat blower is acceptable
• Foundation may be floating. For example, sitting on blocks
• Seasonal road use is acceptable. This means the road does not have to be plowed during the winter
• Water source needn't be drinkable. However, there must be running water in the home
• Property may be accessible only by boat

Eligible Products **

** For specific underwriting guidelines related to the above eligible products, please refer to the applicable product overview

Ineligible Products