Purchase Plus Improvements Program |
Acceptable loan purpose
- Purchase transactions
- Multiple advances to a maximum of four, excluding property purchase advances managed by lender or by Genworth if improvements exceed $40,000 or 20% of initial value.
- Available for Secondary Homes
Eligible properties
- Maximum four units with at least one unit occupied as the principal residence
- New construction or existing properties
Loan-to-value ratio limits
- One and two units - 95% (includes purchase amount and improvements)
- Three and four units - 90% (includes purchase amount and improvements)
- Lending value is based on the lesser of the improved property value or the sum of the purchase price plus direct costs associated with the improvements
- Equity at sale closing includes the equity to close the sale plus additional equity for improvement portion
Amortization options
- LTV > 80%: Up to 35 years
- LTV ≤ 80%: Up to 40 years
Premium Rates *
| LTV ratio | Premium rate |
|---|---|
| Up to 65% | 0.50 % |
| 65.01% - 75% | 0.65 % |
| 75.01% - 80% | 1.00 % |
| 80.01% - 85% | 1.75 % |
| 85.01% - 90% | 2.00 % |
| 90.01% - 95% | 2.75 % |
| Premium is non-refundable | |
| * 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 | |
* Full amount of premium on total mortgage amount, including appropriate portion designated for property improvements, is due on sale closing
Borrower qualification
- Existing requirements related to income, down payment and credit worthiness apply
- Gifted down payments from immediate family member can be used, provided they are properly verified, non-repayable and all other characteristics of the borrower are acceptable
- Government grants may be considered if pre-approved by Genworth
- For specific qualifications related to three four unit properties refer to Homebuyer 95 Product Overview
- GDS/TDS Guidelines:
Credit Score
GDS
TDS
<680
35%
42%
680+ No limit 44%
Terms
- Fixed, capped variable and adjustable rate mortgages are permitted
Documentation requirements (above standard documentation requirements)
- If the proposed improvements exceed 20% of the initial purchase price or $40,000, details of the proposed renovations including cost estimates and available contracts or a completed Genworth Financial Renovation Worksheet must be faxed to Genworth.
Additional terms
- Genworth will issue a conditional Commitment for insurance based on the LTV of the lending value of the improved property
- Coverage issued at the time of closing is for financing related to sale price only
- Insurance coverage will be effective for any lender-managed advances (up to 4) provided proper confirmation of work completed is documented and on file.
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.
