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Genworth Update

Genworth-Financial Mortgage default insurer, Genworth Financial, eased some of its Canadian mortgage insurance guidelines a few weeks back.

It increased its total debt service (TDS) maximums, relaxed credit scores for stated income products, and eliminated special credit requirements for cash-out refi’s and high-rise condos.

Genworth’s new guidelines are now closer to CMHC’s and it appears the company has become increasingly intent on defending its market share. In talking with sources at Genworth, they spoke about some of the reasons behind these guideline changes…

Earlier this year, Genworth was in the front row of the global economic crisis. As a proactive measure to manage risk and protect homebuyers, the company tightened up its qualification standards.

The recent changes (noted above) are basically a reflection of the improvements seen in the Canadian economy and housing market over the past several months.

Genworth cites rebounding consumer confidence, market stabilization, and fewer job losses as key factors behind Canada’s economic improvements.  While the company says it will keep a close eye on the housing market and the economy, it believes “the worst is over.”

That said, Genworth will continue to watch its risk metrics and “make underwriting adjustments accordingly.”