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)
• 0.01-95% 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

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

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

Amortization options

• LTV > 80%: Up to 35 years
• LTV ≤ 80%: Up to 40 years
• If a full premium is paid on the entire mortgage the amortization can be up to 35 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 35 years for the increased mortgage amount).

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

Premium is non-refundable.

*A 0.20% 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 620, (excluding applications on currently insured Genworth mortgages which are reviewed on a case by case basis)
• A minimum credit bureau score of 700 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
• Maximum debt servicing ratios of 35/42.

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

Ineligible Products

• Cash-back Equity
• Family Plan
• 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

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