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Underwriting GuidelinesGenworth Mortgage Insurance underwritten by:Genworth Mortgage Insurance CorporationMarch 19, 2018Let’s help someone buy a house today.12659881.0218

1GENWORTH UNDERWRITING GUIDELINE CHANGES AND CLARIFICATIONSThe following guideline changes and clarifications are effective for MI applications received on or after March 19,2018.Genworth Underwriting Guideline Changes and ClarificationsTopicSectionOld GuidelineNew GuidelinesMinimum credit score4.1, 4.2,Simply Underwrite:Simply Underwrite andfor loans with DTI 4.3, 4.5,Maximum DTI per DU & LoanStandard Guidelines:45%4.6, 4.7,Product AdvisorA representative credit score of4.8700 or greater is required for allStandard Guidelines:loans with DTI greater than 45%.Minimum 620 credit score withmaximum DTI 50% allowedwith a Genworth underwriteManufactured Housing 4.2, 4.5,Simply Underwrite andSimply Underwrite andMaximum CLTV7.12Standard Guidelines:Standard Guidelines:The maximum LTV/CLTV forThe maximum LTV/CLTV formanufactured housing loans is manufactured housing is95%/95%.95%/105% for AffordableHousing and HFA loans.Manufactured Housing 7.12Standard Guidelines:Standard Guidelines:Manufactured housing must be Removed requirement fordouble-wide design or greater.manufactured housing to bedouble-wide design or greater.Renovation Mortgages 7.15Simply Underwrite andSimply Underwrite andStandard Guidelines:Standard Guidelines:The maximum LTV forThe maximum LTV for renovationrenovation mortgages is 95%.mortgages is 97%.Energy Improvement7.16Simply Underwrite andSimply Underwrite andFeaturesStandard Guidelines:Standard Guidelines:Maximum LTV not addressedThe maximum LTV for loans withenergy improvements is 97%.Appraisal4.4Simply UnderwriteSimply Underwrite Guidelines:Requirements - (LoanGuidelines and StandardLoan amounts 1,000,000amounts 1,000,000 orGuidelines:require one Full URAR.greater)Loan amounts 1,000,000require the following:Standard Guidelines:Loan amounts 1,000,000 will 2 Full URARs, orcontinue to require the following: 1 Full URAR and a Field 2 Full URARs, orReview (Form 2000 /Form 1032) 1 Full URAR and a FieldReview (Form 2000 / Form1032)Continued on next pageGenworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Genworth Underwriting Guideline Changes and ClarificationsSingle Close4.7Not addressedSimply Underwrite andConstruction-toStandard Guidelines:PermanentFor single close construction-toTransactions (Creditpermanent loans, there is onlydocumentation)one Note date, therefore, theCredit Scores7.5Standard Guidelines:Loans with one credit scoreare not specifically addressed.Adding clarification on thistopic.Borrower Eligibility5.9Employment Contractswith start date afternote date7.11.3Standard Guidelines:Guidelines do not addressSocial Security Number (SSN)or Individual Tax IdentificationNumber (ITIN) requirements.Not addressedStudent Loan Debt7.10.2Timeshare Accounts7.10.2Standard Guidelines: Deferred student loansmust use the greater of1% of the outstandingbalance or the actualverified monthly paymentin calculating the DTI.Estimated payments arenot allowed. Student loans inrepayment, includingthose utilizing IncomeBased Repayment typeplans, may utilize thedocumented student loanpayment from the studentloan provider forqualification purposes.Not addressedconversion/modification date isnot applicable to the age of(credit) documentation. If theLender opts to activate coverageat the time of propertycompletion, the Lender is notrequired to submit updated creditdocuments as long as the loanclosed per the terms of theCommitment/Certificate ofInsurance.Standard Guidelines:If loan has one borrower and onlyone credit score is obtained, usethe one score as therepresentative credit score for theloan as long as it meets the validcredit score requirements.Simply Underwrite andStandard Guidelines:Adding clarity regarding borrowereligibility. See section 5.9 fordetails.Standard Guidelines:Follow GSE standard guidelinesfor the amount of reserves andany additional requirementspertaining to future employmentor employment starting after thenote date.Standard Guidelines:Follow GSE standard guidelinesfor repayment of debts.Standard Guidelines:Follow GSE standard guidelinesfor repayment of debts.Continued on next pageGenworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Genworth Underwriting Guideline Changes and Clarifications5.20Simply Underwrite andSimply Underwrite andStandard Guidelines:Standard Guidelines:The 1008 must be marked with Removed requirement for lenderthe appropriate project reviewto mark 1008 with the appropriatetype to serve as lender rep &project review type. Lender stillwarranty that the project meets has responsibility to determineGSE requirements.project meets GSE requirementsand must maintain documentationin the Loan File to support thisrequirement.Cooperative Eligibility5.24Standard Guidelines:Standard Guidelines:- Blanket MortgagesThe blanket project mortgage New projects must have amay be a market-rate FHAremaining loan term of atinsured mortgage or aleast 5 years on theconventional mortgage.blanket mortgage Existing projects mustThe blanket mortgage for thehave a minimumproject may be a balloonremaining term of at leastmortgage. The remaining term3 years on the blanketmay not be less than six months.mortgageIf the balloon mortgageincorporates an adjustable-ratefeature, and the remaining term isless than three years but not lessthan six months, the currentinterest rate may not be subjectto an interest rate adjustmentprior to the maturity date.Disaster Policy5.28Not addressedSimply Underwrite andStandard Guidelines:See section 5.28 for details.Second Homes5.13.2Simply Underwrite andSimply Underwrite andStandard Guidelines:Standard Guidelines:Kiddie condos fall into ourKiddie condos fall into ourdefinition of investmentdefinition of second as well as loanswhere the occupying borrowerdoes not contribute anyqualifying income.Condo ProjectEligibilityGenworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Table of ContentsPage 4TABLE OF CONTENTS11.11.21.32USING THE MANUAL . 7Sequence . 7Navigation Features. 7Notes and Footnotes . 7FREQUENTLY USED TERMS . 833. . 9Fair Lending . 9Homeowners Protection Act . 9Compliance with Law . 9Simply UnderwriteSM . 9Standard Guidelines . 9Affordable Housing and Housing Finance Agency Programs . 10Portfolio Dispersion. MATRICES . 11Simply Underwrite Eligibility . 11Simply Underwrite HFA Eligibility . 13Standard Guidelines Eligibility . 15Standard Guidelines for Loan Amounts 700,000 Eligibility (Single Family Properties) . 19Standard Guidelines Affordable Housing Program Eligibility . 21Standard Guidelines HFA Eligibility . 25Standard Guidelines Construction-to-Permanent Eligibility . 29Professional Program. 33Pledged Assets . 45.15ALL LOANS . 37Commitment/Certificate of Insurance Terms, Conditions, Extensions, Reinstatements . 375.1.1Commitment Terms . 375.1.2Underwriting Conditions . 375.1.3Commitment Extensions . 375.1.4Commitment Reinstatements . 37Changes Prior to Certification: Requiring Prior Approval . 37Changes Prior to Certification: Not Requiring Prior Approval . 37Modifications . 38Closed Loans . 38Pre-Approvals . 38Certificate Activation . 385.7.1Zero Monthly Commitments. 385.7.2All Other Premium Plans (Annual, Monthly, Single Premium, Split Premium): . 38Ineligible Loan Features . 395.8.1Loan Features or Programs Requiring a Genworth Underwrite . 40Borrower Eligibility . 415.9.1Permanent Resident Aliens . 415.9.2Non-Permanent Resident Aliens . 415.9.3Inter Vivos Revocable Trusts . 41Maximum Genworth Insured Properties . 41Previously Paid Claim . 41Qualifying Ratios . 415.12.1Debt-to-Income Ratio (DTI) . 425.12.2Housing Expense to Income Ratio (HDI) . 42Occupancy Eligibility. 425.13.1Primary Residence . 425.13.2Second Homes . 425.13.3Investment Properties . 43LTV/CLTV/GLTV/TLTV . 435.14.1Maximum CLTV . 435.14.2Types of Subordinate Financing . 43Refinance Transactions . 445.15.1Rate/Term Refinances (Fannie Mae’s Limited Cash-Out and Freddie’s No Cash-out) . 445.15.2Cash-out Refinance Guidelines . 44Genworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Page 55.15.3Fannie Mae’s Delayed Financing Exception . 455.16 Adjustable Rate Mortgages . 455.16.1ARM Index . 455.16.2Five Year Fixed Period ARM . 455.16.3Lifetime Caps on ARM Loans . 455.16.4Minimum Initial Fixed Period. 455.16.5Per Adjustment Caps on ARM Loans . 455.16.6Qualifying Rate on ARMs . 455.17 Temporary Buydowns . 455.18 Guidelines for Property and Appraisals . 465.18.1Ownership . 465.18.2Eligible Property Types . 465.18.3Energy-Efficient Properties . 465.18.4Mixed Use Properties . 465.18.5Non-Residential Properties . 465.18.6Ineligible Properties . 465.19 Detached PUDs and Detached Condominiums . 465.19.1Detached PUDs . 465.19.2Detached (Site) Condominiums . 465.20 Project Acceptance. 475.21 Project Concentration . 475.22 Attached PUDs and Attached Condominiums Guidelines . 475.22.1Attached PUD Unit . 475.22.2Attached Condominiums . 475.22.3Condominium Project Review Types . 475.23 Attached Condominium Eligibility Requirements . 475.23.1Leasehold Condominiums . 485.24 Cooperative Units Eligibility Requirements . 495.24.1Cooperative Properties Endorsement . 495.24.2Co-op Project Eligibility Requirements . 495.25 Declining Property Values and Geographic Guidelines . 505.26 Non-Arm’s Length Transactions . 505.27 Property Flipping . 505.28 Disaster Policy . 505.29 Appraisal Documentation and Age . 515.30 Builder/Seller Contributions . 515.31 Relocation Loans . 515.31.1Employer Relocation Programs . 5166.16.27SIMPLY UNDERWRITE . 52Simply Underwrite . 526.1.1GSE AUS Recommendations and Risk Classifications for Simply Underwrite . 52GSE AUS Underwriting Obligations . 526.2.1DU Underwriting Findings Report and Loan Product Advisor Feedback Certificate . 526.2.2DU and Loan Product Advisor Data Accuracy . 536.2.3Overlays . 536.2.4Eligibility Exclusions . 53STANDARD GUIDELINES . 54Standard Guidelines Documentation Requirements . 54Standard Guidelines Documentation . 547.2.1LTV 95.01 – 97% . 557.2.2LTV/CLTV/GLTV/TLTV . 567.3 Balloon/Call Options. 567.4 Credit Underwriting . 567.5 Credit History: Using Credit Scores . 577.6 Credit Underwriting: Using Nontraditional Credit . 597.7 Collections, Judgments or Liens . 597.8 Consumer Credit Counseling . 597.9 Pending Lawsuits . 597.10 Assets and Liabilities . 597.10.1Eligible Sources of Funds . 607.10.2Repayment of Debts . 607.17.2Genworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Page s Minimum Contribution and Reserves. 617.10.4Pooled Savings as Debt . 617.10.5Asset Documentation . 61Employment and Income . 617.11.1Self-employed Income . 627.11.2Salaried or Other Income . 627.11.3New Employment Income, Compensation Increases and Employment Contracts . 627.11.4Employment Gap . 627.11.5Foreign Income. 627.11.6Deferred Income . 627.11.7Education Benefits. 627.11.8Trailing Co-Borrower Income . 637.11.9Non-Occupant Co-Borrowers . 637.11.10Temporary Leave Income . 637.11.11Employment and Income Documentation . 63Manufactured Housing Requirements . 64Two Individual Residential Dwellings on One Lot . 64Acreage. 65Renovation Mortgages . 657.15.1Renovation Programs . 66Energy Improvement Features . 66Completion Escrows . 66PRODUCT GUIDELINES . 67Genworth-Insured Refinance Program . 678.1.1GSE HARP-Eligible Refinance Option . 688.1.2Non-GSE Refinance Option. 698.1.3Genworth-Insured Streamlined Refinance Option . 71GLOSSARY . 73Genworth Mortgage Insurance Underwriting Guidelines March 19, 2018 2018 Genworth Financial Inc. All Rights Reserved

Using the ManualPage 711.1Using the ManualSequence 1.2The Introduction provides general information and an overview of doing business with GenworthMortgage Insurance (Genworth).The Eligibility Matrices provide the eligibility criteria loans must meet to qualify for Genworth’s mortgageinsurance.The All Loans section provides detailed requirements for doing business with Genworth andrequirements for Certificate activation.The Simply Underwrite Guidelines provide information on Genworth’s program for DU Approve/Eligible,or Loan Product Advisor Accept, Eligible for Purchase loans that meet certain parameters.Standard Guidelines apply to loans that are manually underwritten without a GSE AUS recommendationor risk classification or loans that do not meet our Simply Underwrite Guidelines.Product Guidelines include Genworth-Insured Refinance Program which includes three options; GSEHARP-Eligible Refinance, Non-GSE Refinance and Genworth-Insured Streamlined Refinance.Navigation FeaturesThe following navigation features are available in the PDF version of the manual:1.Use the Table of Contents to navigate directly to a topic by clicking on the topic or page number.2.Use the Bookmarks pane in a similar manner to navigate to a section or topic. Click on the(bookmarks) icon in the Bookmarks pane to view and click on sections in the document. The location ofthe Bookmarks pane may vary dependent upon the web browser being used, typically it is located on theleft side of the page.3.Use the Find feature to locate all occurrences of a word or phrase. To use the Find feature: Press the Ctrl and F keys together on your keyboard. In the text box that appears, type in the word or phrase and press Enter. Press the Previous or Next buttons to view all occurrences of the term.4.Hyperlinks are provided throughout the manual to navigate directly to a section or external reference.When using a hyperlink within the manual, you can easily return to the lo

Kiddie condos fall into our definition of investment property as well as loans where the occupying borrower does not contribute any qualifying income. Simply Underwrite and Standard Guidelines: Kiddie condos fall into our definition of second homes.

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