Default & Servicing

Default and Claims Servicing Guide
Effective September 17, 2012
Radian Default and ClaimsServicing Guide
Revision notes
Revisions for September 17, 2012
The industrys current focus on improving servicing practices for defaulted mortgage loans, specifically to address the Fannie Mae and Freddie Mac Servicing Alignment Initiative, presents an opportunity for Radian to adapt and update our Default and Claims Servicing Guide. Updates to this Guide are intended to: Define the term Highest Standard of Servicing Performance; Align Radians expectations for defaulted loan servicing performance with standard Fannie Mae and Freddie Mac policies and procedures; Establish Radians position and the role of the Servicer in the successful management of loan workout options; Clarify claim filing and payment practices. By aligning Radians expectations for defaulted loan servicing performance with the updated FannieMae and Freddie Mac policies and procedures, Radian plans to consolidate and simplify information contained within the Guide, and focus on Radian specific processes. The format has been re-designed to include navigation tools which allow for exact location of subject matter references. Bookmarks are displayed on the left side of the Adobe Acrobat Reader. All eligibility topics can beaccessed by simply expanding and clicking on the bookmark of the section, chapter or subject matter you wish to review. In addition, hyperlinks are provided to take you to another area within the guidelines where you canfind additional information on a particular topic. If you click a hyperlink, you may return to your previous place by pressing down the alt (Microsoft) or command (Macintosh) key and the back arrow key at the same time on your keyboard. Should you have any questions about Radians default and/or claims servicing guidelines, please contact our Customer Care team at customer.care@radian.biz 877.RADIAN1 (723.4261) or your Radian representative.
Effective: September 17, 2012
Rev 20121004
Default and Claims Servicing Guide | Revision notes
Table of Contents
Revision notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Revisions for September 17, 2012 . . . . . . . . 2 Navigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1 Servicing Standards . . . . . . . . . . . . . . . . . . . 6 A. Highest Standard of Servicing Performance. . . . . . . . . . . . . . . . 6 B. Servicers Basic Duties and Responsibilities . . . . . . . . . . . . . . . . . . 7 2 Default Servicing . . . . . . . . . . . . . . . . . . . . . . 8 A. Default Servicing . . . . . . . . . . . . . . . . . . . . . 8 F. Deficiency Judgments . . . . . . . . . . . . . . . . 23 G. Documentation/Financial Forms . . . . . . . 23
1. Streamlined Information Requirements . 23

5 Claim Eligibility . . . . . . . . . . . . . . . . . . . . . . . 25 A. The Terms and Limiting Conditions of Radians Master Policy .. . . . . . . . . . . . 25
1. Limitations of Coverage . . . . . . . . . . . 25 2. Exclusions from Coverage . . . . . . . . . 25 3. Inability to Evaluate a Claim . . . . . . . 26

B. Loan Compliance to Underwriting Guidelines and Eligibility. . . . . . . . . . . . . 26
1. Communication with the Borrower . . . . 8 2. Delinquency Prevention and Management . . . . . . . . . . . . . . . . . 9 3. Collection Procedures . . . . . . . . . . . . . 10 4. Bankruptcy Proceedings . . . . . . . . . . . 10 5. Foreclosure Proceedings . . . . . . . . . . .10
3 Reporting. . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 A. Event Reporting . . . . . . . . . . . . . . . . . . . . . 14 B. Loan Delinquency. . . . . . . . . . . . . . . . . . . 14
1. Delegated and Non-delegated Underwriting . . . . . . . . . . . . . . . . . . . . 26 2. Delegated Mortgage Insurance . . . . .26

C. Servicing Performance. . . . . . . . . . . . . . . 26 6 Initiation of a Claim . . . . . . . . . . . . . . . . . . . 27 A. Claims Filing .. . . . . . . . . . . . . . . . . . . . . . . 27
1. When to File . . . . . . . . . . . . . . . . . . . . 27 2. Claims Filing Format . . . . . . . . . . . . . . 28 3. Automated Document Notification . . .28 4. Timeline Summary . . . . . . . . . . . . . . . . 28
7 Perfected Claim .. . . . . . . . . . . . . . . . . . . . . . 29 A. Components of a Perfected Claim . . . . . . 29
1. Initial Notification . . . . . . . . . . . . . . . . 14 2. Recurring Reporting Requirements . . . 14 3. Report Delivery . . . . . . . . . . . . . . . . . . 15

C. Loan Workout/Modification Reporting .. 15 D. Liquidation Reporting Requirements .. . . 15 4 Loss Mitigation . . . . . . . . . . . . . . . . . . . . . . . 16 A. Radian Delegation . . . . . . . . . . . . . . . . . . 16 B. Retention Workout. . . . . . . . . . . . . . . . . . 16
1. Required Documentation . . . . . . . . . . 29 2. Document Submission/Receipt . . . . . . 30

B. Inability to Evaluate a Claim . . . . . . . . . . 31 C. Action During the Claim Filing Period. . . 31
1. Eviction of Tenants . . . . . . . . . . . . . . . 31 2. Filing of Claim before Eviction . . . . . . 31

D. Sale of REO Property/ Duty to Cooperate .. . . . . . . . . . . . . . . . . . 31
1. Delegated Non-Modification Options . 16 2. Delegated Modification Options . . . 17 3. Non-Delegated Modification Option . . 18

C. Liquidation Workout .. . . . . . . . . . . . . . . . 19
1. Listing the Property For Sale . . . . . . . . 31 2. REO Purchase Offers . . . . . . . . . . . . . 32

8 Claim Review/Evaluation . . . . . . . . . . . . . 33 A. Review Requirements .. . . . . . . . . . . . . . . 33 B. Claim Review Timeline. . . . . . . . . . . . . . . 33
1. Delegated Liquidation Options . . . . . 19 2. Non-delegated Liquidation Options . 21 3. Terms/Conditions . . . . . . . . . . . . . . . 21 4. Components of Review . . . . . . . . . . . .22 5. Evaluation Guidelines . . . . . . . . . . . . 22
D. Loan Charge Off. . . . . . . . . . . . . . . . . . . . 23 E. Foreclosure . . . . . . . . . . . . . . . . . . . . . . . . 23
1. Access to the Property . . . . . . . . . . . . 33

C. Claims Investigation. . . . . . . . . . . . . . . . . 33
1. Investigative Timeline . . . . . . . . . . . . . 33 2. Investigation Process . . . . . . . . . . . . . . 33
Default and Claims Servicing Guide | Table of Contents
9 Claim Disposition . . . . . . . . . . . . . . . . . . . . . 35 A. Factors in Rescissions . . . . . . . . . . . . . . . . 35 B. Appeal of Rescission . . . . . . . . . . . . . . . . . 36 10 Claim Settlement . . . . . . . . . . . . . . . . . . . . . 37 A. Timing of Claim Settlement .. . . . . . . . . . . 37
B. Timing of Claim Settlement Under Structured Pool Policies .. . . . . . . . 37 C. Calculation of Claim Liability. . . . . . . . . . 38
1. Additional Documentation . . . . . . . . . 37 2. Access . . . . . . . . . . . . . . . . . . . . . . . . . 37 3. Acquisition . . . . . . . . . . . . . . . . . . . . . . 37 4. SIU and Default Servicing Investigations . . . . . . . . . . . . . . . . . . . . 37 5. Late Payment . . . . . . . . . . . . . . . . . . . . 37
1. Explanation of Benefits (EOB) . . . . . . 38 2. Claims Adjustments . . . . . . . . . . . . . . . 38 3. Return of Paid Claim Funds . . . . . . . . 39 4. Claim Curtailment . . . . . . . . . . . . . . . . 39 Radian Default and Claims Contact Information . . . . . . . . . . . . . . . . 40
Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Default and Claims Servicing Guide | Table of Contents
Introduction
This guide is intended to provide assistance designed to enable a loan servicer to meet the expectations of Radian for servicing a delinquent or defaulted loan with active Radian mortgage insurance coverage. The Servicing Standards provided in this guide define and outline Radians expectations for servicing performance. In order to promote efficiency, Radians expectations for defaulted loan servicing performance are closely aligned with those of Fannie Mae and Freddie Mac, therefore, the GSE servicing guidelines should be considered a part of Radians guide. The information provided in the Default Servicing section highlights those requirements. The focus of this Guide is to present Radians practices, requirements and procedures which areidentified in detail throughout the Guide. This includes a review of: Loss mitigation options and corresponding delegated authority; Factors which impact and influence the claims process, as well as the details necessary to navigate this process. In addition to the information in this Guide, please consult Radians Master Policy and any endorsements or Radians Pool Policy as applicable, to identify specific terms and limiting conditions under which Radian mortgage insurance is issued. These documents provide additional details regarding the insured lenders and Radians respective rights and responsibilities.
This Guide is reviewed and updated on a regular basis. In the event a policy or process change is implemented prior to the next scheduled Guide revision, the details will be communicated in the form of a Radian Servicer Alert. Radian Servicer Alerts can be located on the Servicer page of our website at www.radian.biz. As a courtesy, Radian maintains an active list of servicer contact information so that Servicer Alerts can be sent to key personnel in the servicers organization. Requests for additions, deletions or changes to Radians Servicer Alert email distribution list may be sent to our Customer Care team at customer.care@radian.biz.
Default and Claims Servicing Guide | Introduction
Servicing Standards
Radian mortgage insurance is issued under the terms and conditions of Radians Master Policy. This Policy specifically requires that those responsible for servicing mortgage loans adhere to the highest standard of servicing performance. The following guidance is intended to ensure Radians servicing performance expectations are met.
A.
Highest Standard of Servicing Performance

Radian defines the term Highest Standard of Servicing Performance as: Servicer operation and performance in compliance with all Fannie Mae and/or Freddie Mac requirements as published in the Servicing Guides and related publications. This includes applicable requirements of the Federal Housing Finance Authoritys Servicing Alignment Initiative, as they become effective. Adherence to all rules and regulations specific to mortgage loan servicing imposed by the Consumer Financial Protection Bureau (CFPB). Implied and expressed within, is the servicer obligation to: Comply with the terms and requirements of the applicable Purchase and Sale, Master Servicer, Servicer or Sub-Servicer contracts (Lender Contract) under which loan servicing is performed; and Utilize industry best practices. Implement and maintain processes and procedures used throughout the industry to minimize losses and maximize opportunities for a borrower to retaintheir home. Comply with the terms and requirements of applicable government/Servicer agreements suchas, but not limited to, the AG Settlement and resulting legislation. Radians servicing performance expectations do not exceed those established by GSE published requirements and/or government mandates. Therefore a servicer in compliance with applicable government mandates and published GSE servicing policy will meet Radians Master Policy requirement for Highest Standard of Servicing Performance. In the event Fannie Mae/Freddie Mac requirements differ, applicable GSE guidelines apply. Mortgage loans not purchased or securitized by either Fannie Mae or Freddie Mac, may follow the requirements of either GSE, so long as they are consistently followed. GSE published servicing policy is readily available and is incorporated herein by reference. This Guide does not duplicate this information in the discussion of Servicing Performance. However GSE policy highlights are provided for subject matter reference.
Default and Claims Servicing Guide | Servicing Standards
B.
Servicers Basic Duties and Responsibilities

A Servicer is contracted to perform basic duties and accept specific responsibilities for proper servicing of a mortgage loan, to include the requirements of any other party that may have an interest in the way the mortgage loan is serviced. These requirements include but are not limitedto: Employment of properly trained and knowledgeable staff; Fully documented and current written procedures; Establishment and maintenance of adequate internal audit and management control systems toensure that the mortgage loans are serviced in accordance with established procedures andwith sound mortgage banking and accounting principles; Establish and maintain policies and procedures to guard against dishonest, fraudulent, or negligent acts; Establish and maintain policies, procedures and insurance coverage to guard against errorsand omissions by officers, employees, or others; Adhere to the legal requirements of each jurisdiction in which it operates and not knowingly orthrough negligence breach its Lender Contract; Use prudent professional judgment in the performance of servicing duties; Perform all professional functions and take all necessary steps to protect the collateral securing the mortgage loan insured by Radian; Implement and maintain a viable business continuity and disaster plan.
Default and Claims Servicing Guide | Servicing Standards
Default Servicing
The efficient and successful servicing of a delinquent loan may minimize the potential loss resulting from a borrower default. The required standard for Delinquent Loan Servicing is established by the Radian Master Policy which states, in pertinent part: Every Loan insured under this Policy shall be serviced in a reasonable and prudent manner and consistent with the highest standards of servicing in use in the residential mortgage industry. Claim eligibility is contingent upon existence of the following controls/procedures and execution of the following tasks in compliance with the Master Policy, GSE guidelines and certain timeline requirements.
A.
Default Servicing
In order to achieve the Highest Level of Servicing Performance, a servicer must employ a welldocumented control system for those areas that represent the greatest risk exposure and potential for losses. Therefore a servicer must establish a system, compliant with GSE requirements, for successfully servicing delinquent mortgage loans to include, at a minimum, the following: System controls that provide early detection of delinquent accounts, and the ability to alert theappropriate department that a mortgage loan is delinquent and in need of attention; A collection department staff that is trained, competent and familiar with all investor proceduraland reporting requirements as well as federal and state collection laws; Policies and procedures to ensure the availability of counseling to advise borrowers howtoavoid or cure delinquencies; Training and system controls that enable timely and accurate analysis of each delinquencyleading to early intervention to mitigate loss; Instructions and adequate controls that adhere to federal and state laws regarding consumercontact with respect to delinquency notices, assessing late charges, returning partialpayments, maintaining and recording collection and default servicing activities, reporting delinquencies to credit bureaus, etc.; Regular and consistent management review of procedures designed to evaluate the circumstances surrounding each default, potential loss mitigation opportunities, or the determination to start appropriate proceedings; Establish a method to regularly review and audit the servicers own delinquency and foreclosure ratios in comparison with the industry standard practices.
1. Communication with the Borrower
Direct, thoughtful, and relevant communication with the borrower is identified within the industry as a best practice for servicing delinquent mortgages. Therefore the servicer must ensure that its staff is trained and knowledgeable in all aspects of collection and foreclosure prevention strategies and able to effectively communicate with borrowers and/or representatives and agents authorized by borrowers. This requires having processes and procedures in place to:
Provide initial and continuous training and monitoring of servicing personnel.
Default and Claims Servicing Guide | Default Servicing
Follow Quality Right Party Contact (QRPC), a uniform standard for communicating withtheborrower regarding the resolution of a mortgage delinquency. Respond, in a timely manner, to all inquiries received from borrowers about the terms of their mortgage loans, the status of their accounts, and any actions taken or not taken inservicing their mortgage loans. Ensure that borrowers have an effective means to communicate with the servicer about disputes and that procedures are in place to facilitate resolution of the dispute. Escalate complaints or disputes to an independent staff that has resolution authority. Identify inefficiencies or problems within the process and take appropriate corrective action.
a. Communication Objective
The objective of borrower communication is to obtain or deliver the information necessary tosuccessfully resolve the default: This includes: Borrowers ability and willingness to pay; Reason for default; Borrowers intent to retain or dispose of the property; The existence of a temporary or permanent hardship; Workout options; Consequences of default; Counseling services.
b. Confidentiality of Radian Practices and Procedures
The borrower is not a party to, nor a beneficiary of the mortgage insurance contract (Master Policy). It is not appropriate to disclose to any uninsured third-party the conditions under which Radian is willing to waive any rights established under the Master Policy and/or to accept a claim via the approval of a requested workout. The borrower, realtors, borrowers attorney and other uninsured third parties are not to be provided with communications between Radian and its insured or the servicer representing the insured. Radians feedback and communications are confidential and meant for the servicer and/or the insured only.
2. Delinquency Prevention and Management
Radian supports all reasonable delinquency prevention and management efforts which help toavoid or cure a delinquency as quickly as possible. These practices should align with those identified by Radian as providing Highest Standard of Servicing. Key efforts are identified below: Establishing quality right party contact (QRPC). Assessing late charges. Accepting Partial Payments. Using an attorney to collect payments and/or establish contact with a borrower. Collection under an assignment of rent. Reapplying Principal Prepayments. Listing Property for Sale/Rental. Referring to Counseling Agencies. Offering Early Delinquency Counseling.
3. Collection Procedures
The Servicer is expected to follow all applicable collection procedures allowed by law and required to meet Highest Servicing Standards. The primary goal should be to bring delinquent mortgage loans current as quickly as possible. The GSE required collection procedures are specific to each stage of delinquency and Radian supports those practices. For collection procedure details and requirements, please refer to the GSE Servicing Guide(s).
4. Bankruptcy Proceedings
In the event a borrower files for protection under bankruptcy, the servicer must take all actions necessary to protect the security investment. This includes a number of steps that will need to be taken once notice is received that a bankruptcy filing has taken place, as well as over the course of the bankruptcy proceedings. The servicer must report to Radian the initiation of bankruptcy proceedings in accordance withGSE requirements after it learns that the borrower has filed for bankruptcy (even if the mortgage loan is current).
Bankruptcy Management Process
A servicer must have procedures in place to manage Chapter 7, 11, 12 and 13 bankruptcies, including a system to control and monitor bankruptcy proceedings. A servicer must document in accordance with GSE policy that all required actions were taken to manage a specific bankruptcy in a timely and appropriate manner. These actions include: Confirm Bankruptcy Information. Establish and maintain files to document servicer activity during the Bankruptcy. Refer Case to Bankruptcy Attorney. Suspend Debt Collection Efforts. Notice of Appearance Filing/Bankruptcy Notices. Obtain and Review Statements/Schedules/Reorganization Plans. Prepare and File the Proof of Claim. Attend Initial Meeting of Creditors. Monitor Borrower Payments and Critical Dates. Communicate with Borrowers attorney regarding workout options. Radian may request documentation to confirm the activities listed above.
5. Foreclosure Proceedings
In the event loan retention or other liquidation workout options are not appropriate, Radian expects that foreclosure proceedings be initiated in accordance with the requirements of the Master Policy, and no later than six months after the Insured is permitted to do so under the loan documentation and applicable laws. Link to Loss Mitigation
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a. Foreclosure Overview
The servicer shall timely commence and diligently pursue appropriate foreclosure proceedings in accordance with appropriate state laws and GSE guidelines. Once foreclosure has been initiated, its completion must be pursued diligently. If the borrower contests the foreclosure or files suit, Radian must be notified on the monthly delinquency report (MDR).
b. Foreclosure Expectations
Radian expects a timely referral after a borrower defaults, as well as a sustained and reasonable effort to complete the foreclosure according to state requirements listed below. Radian requires that it be notified of any extenuating circumstances beyond the Insured/ Servicers control which prevents a foreclosure action from being completed within the required time frame, a sample of which is provided below.
Method of Foreclosure* From LPI** to Foreclosure Sale (# of Days) Method of Foreclosure* From LPI** to Foreclosure Sale (# of Days)
State
State
Alabama Alaska Arizona Arkansas California Colorado Connecticut Delaware District of Columbia Florida Georgia Guam Hawaii Idaho Illinois Indiana Iowa Kansas Kentucky Louisiana Maine Maryland Massachusetts Michigan Minnesota Mississippi Missouri Montana
Non-Judicial Non-Judicial Non-Judicial Non-Judicial Non-Judicial Non-Judicial Judicial Judicial Non-Judicial Judicial Non-Judicial Non-Judicial Judicial Non-Judicial Judicial Judicial Judicial Judicial Judicial Judicial Judicial Non-Judicial Non-Judicial Non-Judicial Non-Judicial Non-Judicial Non-Judicial Judicial
270 300 300 280 300 330 690 480 300 660 270 500 500 440 480 480 480 330 420 390 570 485 350 270 270 270 270 360
Nebraska Nevada New Hampshire New Jersey New Mexico New York City New York North Carolina North Dakota Ohio Oklahoma Oregon Pennsylvania Puerto Rico Rhode Island South Carolina South Dakota Tennessee Texas Utah Vermont Virgin Islands Virginia Washington West Virginia Wisconsin Wyoming
Non-Judicial Non-Judicial Non-Judicial Judicial Judicial Judicial Judicial Non-Judicial Judicial Judicial Judicial Non-Judicial Judicial Judicial Non-Judicial Judicial Judicial Non-Judicial Non-Judicial Non-Judicial Judicial Judicial Non-Judicial Non-Judicial Non-Judicial Judicial Non-Judicial
330 360 270 750 450 990 820 300 405 450 420 330 480 720 330 420 360 270 270 330 510 510 270 330 290 480 270
*The Method of Foreclosure column reflects the preferred method of foreclosure for each jurisdiction. **Last Paid Installment
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c. Foreclosure Mitigation
While timely foreclosure processing is important, foreclosure alternatives should still beconsidered throughout the entire process. If appropriate, Radian will authorize postponement or even cancellation of foreclosure sales to mitigate losses. Radian is flexible in the time frames for completion of the foreclosure proceedings, provided that the Insured/Servicer pursues effectiveand sustained loss mitigation efforts and documents how these efforts resulted in the foreclosure delay. If reasonable loss mitigation efforts and proper documentation are not provided, Radian will enforce the provisions of the Master Policy.
d. Foreclosure Documentation
Radian may request copies of all documents with regard to foreclosure. This includes thepre-foreclosure title search, foreclosure deed (which need not reflect recordation), foreclosure complaints, and other notices and decrees. Radian may also request information on whether the foreclosure was judicial or non-judicial and the names ofallparties involved in the foreclosure. Foreclosure sales results are to be sent to Radian via email customer.care@radian.biz within 48 hours after the foreclosure sale is held. Foreclosure sales results are to include the Radian certificate number, bid amount, foreclosure sale date, and the successful bidder.
e. Foreclosure Bid Price
For Radian-insured loans owned by Fannie Mae, Radian has approved Fannie Maes foreclosure bidding instructions dated 01/31/03 and presented in Fannie Maes currentServicing Guide. For all other loans, and in the absence of specific foreclosure bidding instructions from Radian, the insured must bid in accordance with the following state guidelines. a) In states which provide deficiency recovery rights, or if special circumstances warrant,Radian may specify a bid outside of the state guidelines in order to preservedeficiency rights. b) Radian will not require a bid of less than the uninsured loan amount. If the recommended bid per state guidelines is less than the uninsured loan amount, theinsured may bid the uninsured loan amount. The chart shown below provides asample of current state permitted bid instructions.
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State
AK AL AR AZ CA CO CT DC DE FL GA Guam HI IA ID IL IN KS KY LA MA MD ME MI MN MO MS
Bidding Amount
Total Debt Total Debt FMV - Full value* Total Debt FMV - Full value* Total Debt FMV - Full value* FMV - Full value* FMV - Full value* Open @ $100 up to full FMV* FMV - Full value* Total Debt FMV - Full value* Total Debt FMV - Full value* Total Debt FMV - Full value* Total Debt FMV - Full value* FMV - Full value* FMV - Full value* FMV - Full value* FMV - Full value* Total Debt Total Debt FMV - Full value* FMV - Full value*
State
Bidding Amount
MT FMV - Full value* NC FMV - Full value* ND Total Debt NE FMV - Full value* NH FMV - Full value* NJ Open @ $100 up to full FMV* NM Total Debt NV FMV - Full value* NY Open @ $500 up to full FMV* OH FMV - Full value* OK FMV - Full value* OR FMV - Full value* PA Open @ Sheriff cost up to full FMV* Puerto Rico FMV - Full value* RI FMV - Full value* SC FMV - Full value* SD FMV - Full value* TN FMV - Full value* TX FMV - Full value* UT Total Debt VA FMV - Full value* VT FMV - Full value* WA Total Debt WI FMV - Full value* WV FMV - Full value* WY Total Debt
* The bid must not exceed total debt. If the bid calculated according to the table above exceeds total debt, then bidtotaldebt. Radian will not require a bid of less than the uninsured loan amount. Uninsured loan amount = Total debt - (total debt x % coverage); Total debt = Total debt + attorneys fees and costs.
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Reporting
Event Reporting
The following occurrences are to be reported to Radian as they may impact the collateral securing the insured loan. Borrower death. Hazard Insurance Claim in excess of $10,000 filed on subject property. Substantial destruction of collateral. Property vacancy. Property condemnation. Title issue adversely affecting the insureds first lien position. In the event an occurrence coincides with loan default, this information is expected to be includedin the normal default reporting. For those occurrences which do not coincide with loan default, the Servicer is to report the event to Radian via email at customer.care@radian.biz, upon discovery, no longer than 30 (thirty) days after it is known.
A.
B.
Loan Delinquency
Radian requires that the servicer report specific delinquent loan information in order to predictfutureclaim filings.
1. Initial Notification
The Notice of Default (NOD) is to be used at the time of initial notification. Link to Notice of Default
Default Status
Early-Payment Defaults The borrower fails to make any of the initial 12monthly loan payments. Seasoned-Payment Defaults The borrower fails to make three consecutivepayments after the first year oftimely loan payments. Current Loan in Jeopardy Information made available to the Servicerindicates the loan is in jeopardy ofimminent default.
Initial Notification
Report using a Notice of Default (NOD) no later than day45in the delinquency. Report using a Notice of Default (NOD) no later than day75inthe delinquency.
Report using a Notice of Default (NOD) only after a careful review of the facts and circumstances surrounding the case.
2. Recurring Reporting Requirements
The Monthly Delinquency Report Document (MDR) is to be used for all subsequent andrecurring reporting.
Link to Monthly Delinquency Report
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Default and Claims Servicing Guide | Reporting
For all defaulted loans reported to Radian, the Servicer is required to provide thefollowinginformation on a recurring monthly basis: The due date; Specific reason for default; All contact efforts; The specific results of any borrower contact; Any action taken specific to a retention workout. Monthly Delinquency Reports (MDR) must continue until it has been reported that: a) The borrower is no longer in default; b) The loan has been paid in full; c) The servicing has been transferred (servicing transfers should not be reported aspaidinfull or cures); d) The borrower has completed the modification trial period and the loan has beenbrought current as a result of a completed modification; e) Applicable bankruptcy/foreclosure proceedings have concluded; or the claim hasbeenpaid.
3. Report Delivery
Initial notification (NOD) and recurring monthly reporting (MDR) may be delivered via electronic file transmission, computer tape or by an individual report sent to Radian. For NOD submissions other than EDI, an MDR from Radian will be produced and provided tothe lender each month until the loan cures, pays off, or a claim is filed. The completed form should then be returned to nodreport@radian.biz. If prior arrangements have been made with Radian to report loans in default by electronic filetransmission, Radian will not send MDRs to the lender. The lender can choose to transmit an electronic file each month, email a text file to nodreport@radian.biz, or drop the file in an inbound designated folder for FTP transmission. This file must be received by Radian no later than the last day of each month. For specific instructions before choosing this option, please contact Radians Default Reporting Department at nodreport@radian.biz.
C.
Loan Workout/Modification Reporting

In October 2011, Radian joined the Mortgage Insurance Companies of America (MICA) in the adoption of a new standardized template for servicers to report loan workouts. Servicers were required to begin using this template in April, 2012 and, following a transition period, will be notified by Radian to discontinue any legacy methods for workout submissions. Servicers can contact their Radian Risk Manager to obtain additional guidance on the completion and submission requirements of the new template.
Link to modification reporting
D.
Liquidation Reporting Requirements

Link to liquidation reporting
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Default and Claims Servicing Guide | Reporting
Loss Mitigation
A timely evaluation of foreclosure prevention alternatives is to occur once the servicer determines a default is imminent. Government mandates such as the AG Settlement must be followed when applicable; otherwise, the Servicer is to follow the established GSE workout hierarchy, which details the preferred order of consideration for the use of special relief measures and foreclosure prevention options. This includes a procedure to obtain relevant borrower personal and financial information to determine the appropriate workout solution, which includes both retention and liquidation alternatives. It is imperative that the servicer exhaust all retention workout options before pursuing a liquidation workout. The following structure represents the GSE and Radians preferred hierarchy:
Retention Workouts
1. 2. 3. 4.
Reinstatement Repayment Plan Forbearance Loan Modification
Liquidation Workouts
5. Pre-foreclosure (Short) Sale 6. Deed-in-lieu of foreclosure 7. Foreclosure Sale
A.
Radian Delegation
Radian values and encourages any and all efforts by the Servicer to mitigate loss. To assist inthese efforts, Radian extends to the servicer certain delegated authority. The delegated authority identified within this Guide is extended for the sole purpose of facilitating the servicers execution of workout options. This authority is expressly limited to those workout options which: Meet the investor/insureds guidelines; and Provide the assistance necessary to resolve a default situation. This delegation permits the servicer to exercise independent and prudent judgment in providing workout options to borrower(s) and is not limited to government sponsored workout options, suchas the Treasurys Home Affordable Modification Program (HAMP).
B.
Retention Workout
1. Delegated Non-Modification Options
Radian extends to the servicer full delegated authority to execute the following non-modification retention work out options. These include repayments plans, forbearance plans, partial reinstatements and stipulation agreements. Radian is to be notified of the completion of such efforts through standard default reporting requirements. Link to default reporting requirements
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Default and Claims Servicing Guide | Loss Mitigation
Fully Delegated Retention Workout Options

Repayment Plan: A plan based on a borrowers financial situation to spread out repayment of a
Coverage Type
past-due balance over an extended period of time. A repayment plan does not change the original terms of the Loan.
Forbearance Plan: Provides a temporary reduction or suspension of payments on a mortgage loan; and it is typically incorporated in a payment arrangement to cure any delinquent payment after the underlying hardship has gone away. Partial Reinstatement: A payment transaction wherein the Borrower(s) pays a portion of the Loan
Primary and Pool
arrears and agrees to a repayment plan for the balance owed.

Stipulation Agreement: A post foreclosure initiated agreement under which the borrower agrees
to waive all defenses to a foreclosure action and make a certain number of payments, in order to be considered for a loan modification or to reinstate the mortgage.
2. Delegated Modification Options
Radian supports modification efforts whenever the servicer has obtained information sufficient to ascertain that the repayment terms of the modified loan are affordable for the borrower. Radian extends to the Servicer delegated authority to complete a modification based on the following conditions.
Treasurys Home Affordable Modification Program (HAMP) GSE Loans Radian agrees to provide servicers with Radian Delegated authority in order to support the execution of loan modifications within the Treasurys Home Affordable Modification Program (HAMP). These modifications must meet all guidelines/requirements under the applicable GSEHAMP policy.
Delegated Retention Workout Options
Workout/Coverage Type Modification terms: Delegated Program Requirements
Must result in a payment that is affordable for the borrower Does not release any portion of the collateral
Modification Coverage terms:
Coverage extended to the modified unpaid principal balance (UPB) on all HAMP modifications. Radian will limit coverage to the modified UPB up to the original loan amount on all nonHAMPmodifications.
For coverage on GSE non-HAMP modifications, please check coverage limits for each GSE.
Loan Status:
Loans must be at least 60 days delinquent. Premium Payment (monthly/annual) : Calculated from the modified Unpaid Balance (UPB).
Modification with Principal Forgiveness* Coverage terms:
Includes any part of principal that was forgiven pursuant to a workout, but excludes any interestaccumulated on the forgiven principal after the date of the modification
Claim Payment:
In the event a loan modification involving principal forgiveness re-defaults and a claim is submitted, the claim payment amount shall be reduced by the amount of premium that Radian would have received on the forgiven principal from the date of modification through the date ofdefault.
* Principal Forgiveness: Radian will not terminate coverage upon removal of the underlying loan from the securitization due to the modification. Radian reserves any rights or defenses it may have under its applicable Master Policy. Under no circumstances will Radian cover principal forgiveness when the principal forgiveness is court ordered in settlement of any litigation or other administrative action involving the insured and/or servicer.
Delegated Loan Modification Program Reporting Requirements
The status of a loan modification, including a trial plan, completion or cancellation mustbe reported to Radian using the Delegated Loan Modification Notice. Link to Delegated Loan Modification Notice
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This reporting requirement applies to both HAMP and non-HAMP modifications. In addition: HAMP For any loan deemed to be in imminent default under the provisions of the Treasurys MakingHome Affordable program, a NOD must be forwarded to Radian.
Link to Loan Delinquency; Initial Notification
HARP A Notification of Mortgage Insurance Modification is to be completed and emailed toRadianat the time the new HARP loan is originated. See Radians website for completedetails.
Link to HARP guideliness
Principal Forgiveness Radian must be notified of all principal forgiveness workout plans within 30 days of borrower execution of the modification agreement using the Delegated Loan Modification Notice.
3. Non-Delegated Modification Option a. MI Second Look Program
The companies of the Mortgage Insurance Companies of America (MICA) established the MI Second Look Program in May 2009 to help avoid potential disparate treatment of borrowers with insured mortgage loans by facilitating modifications, for HAMP-eligible loans in their portfolios that fail the Treasury NPV test. The MICA companies acted in February 2010 to enhance support of HAMP and minimize exception processing for servicers by implementing MI Second Look. All requests under the MI Second Look program must be submitted to Radian identified as an MI Second Look request. Servicers are required to consider MI Second Look as an option of last resort for aiding modifications on any Radian-insured loan that meets the requirements below and must document their systems to reflect such. The loan must be 90 days or more past due. The loan has a current LTV greater than 90% established by an appraisal or broker price opinion (BPO), interior inspection, performed and reported within the most recent 120 days. The loan was originated prior to 01/01/2009. Non-GSE loans only. Primary coverage only. Property must be the current primary residence of the borrower. The borrower is not in bankruptcy. The Servicer has exhausted all other available modification options. The requested advance amount does not exceed the maximum coverage of the loan, lessany prior advances made. The Servicer agrees that an advance greater than 65% of the maximum claim amount isdeemed to be a commutation of the mortgage insurance coverage.
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b. MI Second Look Submission Process
Servicers must submit all requests electronically to MISecondLook@radian.biz using the MI Second Look Request Template. Link to MI Second Look Request Template After receipt of a complete MI Second Look Request, Radian will respond to the request within 10 business days. Servicer will maintain all of the supporting documentation used to support the request. Radian may request the servicer provide this documentation and additional documentation in order to make its decision. If an advance request is approved, it will be funded after the Servicer notifies Radian themodification has been executed, reported and the loan has cured.
C.
Liquidation Workout
For certain liquidating workout types (short sales, assumptions, short refinances and deeds-in-lieu) Radian will not consider a claim unless the loan is in default (60 days or more past due). Link to liquidation options It is Radian policy to waive its right of subrogation to pursue the deficiency upon completion ofanapproved or delegated short sale or deed-in-lieu of foreclosure.
1. Delegated Liquidation Options
Link to Radian delegation
Radian may, at its sole discretion, grant delegated authority to provide liquidation options tothe borrower that help to resolve a default situation as follows: Full delegated authority for Short Sale and Deed-in-lieu transactions under agreements reached between Radian and the GSEs on GSE owned loans. The Servicer is expected tofollow the liquidated workout guidelines and procedures established by the agreements for all Loans insured by Radian. Delegated authority, according to the following terms and conditions, is available on all non-Fannie Mae owned loans, HAFA* loans and/or assumptions. HAFA is a federal program that authorizes a participating mortgage lender/servicer to consent to a sale of the property by the borrower (short sale) with pre-approved terms and conditions in order to avoid foreclosure. A deed-in-lieu of foreclosure may also be an option under the HAFA program if selling the property is not feasible.
*Home Affordable Foreclosure Alternatives (HAFA)
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Loan:
Delegated Program Requirements

Short Sale; Primary Coverage only
Loan is 60 days or more past due as of the servicers short sale written approval date.
Borrower Participation:
Servicer used its best efforts to obtain reasonable borrower financial participation (if appropriate).
Claim:
Estimated Radian claim payment does not exceed $30,000. Restoration adjustment waived if repair cost less than $7,500. If the estimated loss from the sale transaction does not exceed Radians primary coverage claim payment, thefollowing criteria must be met: Net Proceeds to Property Value ratio must be 82% or more.
Documentation:
Credit Report obtained subsequent to the Short Sale request must indicate the Primary Borrowers FICO is 580 or less. Interior BPO/Appraisal to be dated 180 days or less prior to the servicers short sale written approval date. Copy of final HUD1 settlement statement. Assessment regarding borrower participation.
Deed-in-lieu of Foreclosure; Primary Coverage only Loan:
Loan is 60 days or more past due at the time the Deed-in-lieu of Foreclosure document is executed by the borrower. Loan must have been originated as owner occupied, primary residence. Completed Deed-in-lieu of Foreclosure must be reported to the major credit repositories.
Borrower Participation:
Servicer used its best efforts to obtain reasonable borrower financial participation (if appropriate).
Property:
Property must be listed at fair market value for at least 90 days unless primary borrower is deceased or the borrower has obtained a Chapter 7 bankruptcy discharge of mortgage liability. Prior to conveyance, title to the property must be free and clear of all liens and encumbrances.
Claim:
Estimated Radian claim payment is not to exceed $30,000. Completed Deed-in-lieu of Foreclosure must be reported to the major credit repositories. Fund(s) disbursed to a junior lien holder to facilitate clear title are not claimable unless approved in writing by Radian Loss Mitigation.
Documentation:
Credit Report obtained subsequent to the Deed-in-lieu of Foreclosure request must indicate the Primary Borrowers FICO is 580 or less. Interior BPO/Appraisal Date must be 180 days or less prior to the Servicers Deed-in-lieu approval date.
a. Liquidation Reporting Requirements
Short sale and Deed-in-lieu status is reported to Radian using the Delegated Pre-foreclosure Sale Notice. Delegated Pre-foreclosure Sale Notice. Short sale At time of claim filing, notify Radian of sale results and submit all documents from thetransaction. Deed-in-lieu At the time of claim filing, notify Radian that title has been acquired via Deed-in-lieu andsubmit all documents from the transaction. Assumption Notify Radians Customer Care department of assumption terms and new borrower information by emailing customer.care@radian.biz.
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2. Non-delegated Liquidation Options
All loans not meeting Radians Liquidation delegated authority, must be submitted by theServicer prior to the liquidation event occurring. These events include: Pre-Foreclosure; Short Sales; Short Refinances; and Deeds-in-lieu of Foreclosure. Please contact Radian Customer Care at customer.care@radian.biz, 877.RADIAN1 (723.4261) and ask for the Liquidation team if you wish to discuss or submit a liquidation workout request. Link to Delegated Liquidation Options For HAFA loans not meeting delegated authority guidelines: The Servicer must obtain Radians written approval to determine if HAFA program requirements can be met before communicating HAFA eligibility to the borrower or any third party associated with the Liquidating Workout. Radian reserves its rights and defenses under the Master Policy for claims submitted subsequent to a HAFA Liquidating Workout. Certain HAFA-related expenses are not claimable (relocation assistance, for example). Information requirements for HAFA Liquidating Workout requests are streamlined. TheServicer should submit all Liquidating Workout requests to the assigned Radian LossMitigation Specialist via email noting the request is specific to HAFA. Link to Documentation; Streamlined Information Requirements
3. Terms/Conditions a. Delinquency Status
In order for a liquidating workout request to be considered, a loan must be 60 days ormore past due unless one of the following exceptions apply: The Borrower has been discharged from mortgage liability through Chapter 7 Bankruptcy (confirmed by recent credit report or a copy of the bankruptcy document). The Borrower is deceased (copy of the Death Certificate required). Involuntary Employment Relocation (required supporting documentation may include asigned and dated letter from the prior and/or current employer confirming an employment change or layoff that required relocation). In the event none of the above exceptions applies and the Servicer believes it appropriate to move forward with the transaction, Radian may consider a negotiate settlement and accept a claim. Please contact a Radian Loan Workout Specialist at claims.department@radian.biz to discuss a workout of this nature.
b. Waiver of Policy Rights/Requirements
In considering a Liquidating Workout, Radian is being asked to waive the following rights under its Master Policy: The requirement that the insured obtain title to the property (Primary Coverage);
The requirement that the insured obtain title to the property and sell the REO (PoolCoverage);
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The right of subrogation with respect to deficiencies; The right to acquire title to the property. Radian reserves all rights and defenses under the applicable Policy of Insurance not tacitly waived by its approval of a Liquidating Workout, including the right to rescind coverage or deny claims.
4. Components of Review
Radians review of a liquidating workout requires the Servicer obtain and submit specific documents and information.
Link to Documentation/Financial Forms
This information will be used by Radian to evaluate the following factors: Whether the borrower has the ability to pay all or a portion of the amount owed; The borrowers original occupancy intent and current occupancy; The estimated proceeds from the liquidating workout relative to the propertys fair market value and seller costs; Whether the Servicer offered appropriate Loss Mitigation services to the borrower; Whether the proposed Liquidating Workout is an arms-length transaction; Any other factor bearing on the propriety of the proposed Liquidating Workout. Radian will conduct all of its communications relating to liquidating workouts exclusively with the Servicer. Any communications from an interested third party to Radian will be referred tothe Servicer. The Servicer will be solely responsible for any and all communications with theborrower and/or any interested third parties.
5. Evaluation Guidelines For primary and/or modified pool coverage where the estimated loss exceeds Radiansmaximum coverage amount:
Rather than refuse a Liquidating Workout request, Radian will review the request and, if appropriate, communicate a proposed claim payment adjustment (reduction) along with any other terms and conditions. Any proposed adjustment is specific to the Liquidating Workout request. The proposed claim payment adjustment will vary relative to the facts surrounding the request. In the event Radian provides both primary and modified pool coverage the adjustment will be based on the total estimated loss to Radian under both coverages. The Servicer may, in its sole discretion: Accept Radians conditional approval and proceed with the transaction; Offer to reduce the proposed claim payment by adjusting the net proceeds requirement; Provide Radian with additional documentation that supports an elimination or reductiontothe proposed claim payment adjustment; Decline our conditional approval and continue to service the loan in accordance with therequirements of Radians Default and Claims Servicing Guide.
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D.
Loan Charge Off

A charge off is a resolution available to the insured where the outstanding debt of adelinquent mortgage loan is written off as a loss without the Servicer taking title to the subject property. Radian has no liability to accept or pay a claim on a charged off account under any policy of coverage when the Insured has not acquired clear title to the property. Radian reserves all of itsrights and defenses under the applicable Policy of Insurance, including the right to rescind coverage or deny claims. Without waiving any of its rights, Radian may, under appropriate circumstances, consider reduced payments in exchange for cancellation of coverage on chargedoff loan accounts. Please contact Customer Care at customer.care@radian.biz, 877.RADIAN1 (723.4261) andaskforthe Loss Mitigation team if you wish to discuss a charge-off situation.
E.
Foreclosure
Loss Mitigation Methods and Strategies It is the responsibility of the Servicer to: Perform a thorough review of the circumstances surrounding the default and the results ofpriorservicing activities prior to commencing foreclosure proceeding. Offer or encourage delinquent borrowers to seek free or low-cost consumer credit counselingservices. Establish a business process to ensure that all cases are reviewed before referral to foreclosure and that all reasonable steps have been diligently pursued to avoid the need for referral. Comply with, all federal, state, and local laws (including statutes, regulations, ordinances, administrative rules and orders and judicial rulings and opinions that have the effect of law) that apply to any of its origination, selling, servicing or other business practices (including the use of technology) that may have a material effect on the results of servicing activities. Among other things, this means that the servicer must comply with any applicable law that addresses fair housing and equal credit laws. Comply with conflict of interest/confidentiality responsibilities.
F.
Deficiency Judgments
Radian subrogates to the lenders rights to pursue a deficiency. On Radian insured loans, we reserve the right to pursue borrowers directly where permitted by state law. These rights must bepreserved and protected by the Insured/Servicer.
G. Documentation/Financial Forms 1. Streamlined Information Requirements
Radian understands that time is of the essence when pursuing and evaluating loss mitigation opportunities. This is particularly true for time-sensitive liquidating workout.
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Please be aware that the following information must be submitted to Radian to confirm Servicer efforts regarding liquidating workouts: 1st Lien Loss Mitigation Streamlined Short Sale Information Requirements Submit, via secure email, to a Radian Loss Mitigation Specialist the following information: Your Loan Number Radian Certificate Number Borrower(s) Last Name(s) Next Payment Due Date Unpaid Principal Balance (UPB) Total Mortgage Debt (UPB, past due interest, costs, advances, etc.) Foreclosure Sale Date (if applicable) Property Value, Value Date and Value Type (BPO, Appraisal, AVM, etc.) Recommended List Price/Purchase Amount Estimated Net Proceeds Anticipated Closing Date (if known) Reason for Default (if known) Any material information that you believe should be disclosed to facilitate a decision. (HAFA program for example) Name and phone number of submitter 1st Lien Product Loss Mitigation Streamlined Deed-in-lieu of Foreclosure Information Requirements Submit to a Radian Loss Mitigation Specialist via secure email the following information: Your Loan Number Radian Certificate Number Borrower(s) Last Name(s) Next Payment Due Date Unpaid Principal Balance (UPB) Estimated Total Mortgage Debt (UPB, past due interest, costs, advances, etc.) Property Value, Date and Type (BPO, Appraisal, AVM, etc.) Is the Property listed for Sale? If yes, what is the current asking price? Reason for default (brief description) Name and phone number of submitter Any material information that should be disclosed to facilitate a decision (HAFA program for example)
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Claim Eligibility
The eligibility of a Claim is determined by: 1.) The Terms and Limiting Conditions of Radians Master Policy 2.) Compliance with Underwriting Guidelines and Eligibility Criteria 3.) Servicing Performance
A.
The Terms and Limiting Conditions of Radians Master Policy

1. Limitations of Coverage
Prior to any of the following actions being taken, it is necessary to contact a Radian Loss Mitigation Specialist to obtain Radians prior consent in order to ensure continued coverage ofthe loan. Failure to obtain Radians prior consent may result in termination of coverage pursuant to the terms of Radians Master Policy. Any material change or modification of the terms of the Loan including, but not limited to, the UPB interest rate, term or amortization schedule, excepting only such modifications specifically provided for in the Loan documents, and permitted without further approval orconsent of the Insured.
Link to Delegated Modification Options
Any release of a borrower from liability for the loan, including any loan principal forgiveness.
Certain specific principal forgiveness modifications may be completed using delegated authority.
Linkto Principal Forgiveness delegation
Any assumption of liability for the loan with release of the original borrower from liability. Any release of the collateral or any partial release of the collateral. Any change in the character or use of the property (for example, the conversion of a single-family home into a commercial property). Any transfer or sale of the servicing of the loan to a company not approved* by Radian.
*Approval requires the Servicer to have an active Master Policy with Radian.
2. Exclusions from Coverage
Radians coverage is limited to the normal risk of a default caused by a change in the borrowers economic circumstances. Insurance coverage under the Master Policy does not extend to certain risks. The occurrence of any of the following may result in denial of coverage or curtailment of claim payment.
Link to Radians Master Policy
Any loss resulting from the lender exercising its right to accelerate the loan based on a balloon payment clause in the loan document. However, if the borrower refuses to accept an extension or renewal of the mortgage terms at market rates from the lender, this condition will not apply.
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Default and Claims Servicing Guide | Claim Eligibility
Any loss on a loan which was delinquent prior to Radian issuing insurance coverage onthatloan. Any loss as the result of incomplete construction of the insured property. Any loss resulting from fraud or misrepresentation of a material fact upon which Radian based its decision, in whole or in part, to insure the loan. Any loss or material increase in risk of loss resulting from negligence in the origination oftheloan or servicing of the loan prior to or after default. Any cost or expense to repair any physical damage to the Property, including but not limitedto physical damage arising from: Contamination by toxic waste or hazardous water; Earthquake, flood, or other act of God; Civil war or riot; Any defects in construction not identified in the Application for Insurance.
3. Inability to Evaluate a Claim
In order for a Claim to be eligible, Radian must be in receipt of all requested documentation which it considers, in its sole discretion, to be reasonably necessary to evaluate liability with respect to the Claim. Failure to submit a Perfected Claim within the time period specified by the pertinent policy shall relieve Radian of any obligation or liability with respect to the underlying Certificate ofInsurance.
Link to Perfected Claim
B.
Loan Compliance to Underwriting Guidelines and Eligibility

1. Delegated and Non-delegated Underwriting
For both delegated and non-delegated mortgage insurance, Radian relies on the lenders representation and warranty that the loan closed in compliance with the terms and conditions under which the loan was underwritten and approved. Adherence to this requirement is reviewed by Radian when a mortgage insurance claim is submitted.
2. Delegated Mortgage Insurance
For delegated mortgage insurance, Radian further relies on the lenders representation andwarranty that the loan file and application for mortgage insurance have been presented accurately and underwritten in accordance with the agreed upon insurance underwriting standards. Adherence to the underwriting standards behind the lenders representations and warranties is reviewed by Radian when a mortgage insurance claim is submitted.
C.
Servicing Performance
Failure to adhere to the Highest Level of Servicing Performance may result in the denial or curtailment of claims.
Link to Claim Curtailment
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Default and Claims Servicing Guide | Claim Eligibility
Initiation of a Claim
When it becomes necessary to file a claim, it is important to comply with the following procedures. Timely, accurate claim filing will expedite the claim settlement process. Radian strives to settle claims promptly and fairly in compliance with the terms of the agreements between it and its Insureds and insurance laws.
A.
Claims Filing
Radians Master Policy provides timelines for both Radian and the Servicer to request and submit documents. Radian expects Claims to be filed within 60 (sixty) days of the Insureds acquisition of Borrowers Title. Once the Claim filing has been received, Radian will request, within 20 (twenty) days, the documents necessary to perfect the Claim directly from the Servicer.
1. When to File a. Primary Insurance
Radian requests that all Claims be filed no later than 60 days after title is obtained through a foreclosure sale. If the title was acquired through a voluntary conveyance, the60-day period begins when the borrower signs the deed. A claim may be filed prior to the expiration of the redemption period; however: The claim filing period will not begin until the expiration of the redemption period. Radian will not cover any expenses incurred after claims have been filed. Supplemental Claim As a courtesy, Radian will process supplemental claims for allowable Advances and expenses not available at the time of claim filing, provided the supplemental claim is received within 60 days of the original claim payment. Please email supplemental claim requests to claims.department@radian.biz.
b. Pool Insurance
As a guideline, a claim is to be filed with Radian no later than 60 days after closing onthe sale of the REO Property. A copy of the settlement statement from the sale of theREO property must be included with the claim. Please refer to Special Risk policy covering the certificate for the specific claim filing deadline.
c. Extensions
An extension of the 60-day claim filing period may be requested. Submit the request inwriting to Radians Claims Department before the 60-day period expires at claims.department@radian.biz.
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Default and Claims Servicing Guide | Initiation of a Claim
2. Claims Filing Format a. Radians MI Online
Claims can be filed electronically through MI Online, Radians secure self-service Web-based portal. If you have not established an account with Radians MI Online, visitour web site at www.radian.biz for registration instructions. Filing a claim through MI Online allows Servicers to:
Receive confirmation of a claim filing. Review Claim Status for one or multiple claims. View and download an Explanation of Benefits (EOB). Review and Print Revised Claim and Original Claim. Review status of documents submitted. Save partially submitted claims for completion at a later time.
b. Additional Options
Industry standard 260 transaction. Email notification of a claim filing via secure email to nodreport@radian.biz.
3. Automated Document Notification
Radians automated notification system initiates email contact after a claim has been filed. Requests for missing documentation and the status of documentation review are system generated and sent via a secure server using the Radian email address ClaimsDocumentRequest@radian.biz. The email should include Radians Certificate Number and the Servicers Loan Number.
4. Timeline Summary
Servicer Claim Filing Claim Filing Extension Radian Request for Documents fromtheServicer Servicer Response to Radian DocumentRequest 60 days after acquiring Borrowers Title. Radian will consider upon request prior to 60 days expirationperiod. Within 20 days of the receipt of Claim filing. 90 days after receipt of Radians document request.
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Default and Claims Servicing Guide | Initiation of a Claim
Perfected Claim
A Claim must be perfected, meaning the filing must include all of the information and proof Radian, in its sole discretion, considers to be reasonably required to evaluate Radians liability. Once a claim has been filed, Radian will request all required documentation necessary to perfect the claim directly from the Servicer.
A.
Components of a Perfected Claim

1. Required Documentation
The following fully executed documentation is required prior to claim review:
In certain cases, Radian may have an agreement with the servicer/insured to request the loanorigination and closing documents upon notification that a foreclosure sale has been scheduled. In this case, required Servicing documents will be requested upon claim filing.
a. Loan Origination Documents include, but are not limited to:
Loan Application: Fully executed 1003 original and/or final. Assets Any and all documentation necessary to evidence sufficient funds to meet down payment and reserve requirements, according to the terms of the loan program. Income Any and all documentation necessary to evidence income from an acceptable source in an amount sufficient to meet program ratio requirements. Credit credit report, trade line histories, credit references and/or documentation necessaryto evidence indebtedness and satisfy loan program credit history requirements. Property Appraisal/Valuation acceptable evidence of collateral valuation. Purchase Agreement, as applicable complete and fully executed contract of sale includingall addenda. DU, LP or Proprietary AUS Findings Report, if applicable. Underwriting Approval Document to identify loan program and all applicable underwriting and closing conditions.
b. Closing Documents include, but are not limited to:
Final HUD-1 Copy of the mortgage note Explanation of the repayment feature for any mortgage instrument other than the standard level payment amortizing type, including those with adjustable rates.
c. Servicing documents include, but are not limited to (where applicable):
Payment History; ever to date Bankruptcy Documentation, identify date filed; date discharged
Modification Agreement; note the Unpaid Principal Balance (UPB), prior to themodification
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Default and Claims Servicing Guide | Perfected Claim
Short Sale or Post Sale HUD, property value at time of sale; Approval Letter Deed-in-lieu Foreclosure Information/Timeline, in the event of foreclosure delay Link to Foreclosure Documentation BPO/Appraisal, as is; repaired Sheriffs Deed/Trustee Deed Certificate of Title or Sale Coverage: Tax information/Homeowners insurance; submit coverage dates for taxes and insurance being claimed Primary Explanation of Benefits (EOB), HUD-1, pool loans
d. Servicing, Collection and Loss Mitigation Notes
Call record Action taken log Default Notes Communications with Borrower Financial packages collected subject to Treasury Programs
2. Document Submission/Receipt a. Submission
Once a Claim is filed, the Servicer can submit the required documentation through one ofthe avenues identified below. The preferred method is FTP (File Transmittal Protocol). FTP (SFTP, FTPS, or FTP w/ PGP Encryption) Email to ClaimsDocumentRequest@radian.biz CDs Paper
Link to Radians MI Online
b. Document Receipt
Users of MI Online can access the Document Status tab to view the status of documentrequests. All claim-related documents received by Radian are housed in Radians Loss Management document imaging system. Benefits include: Receipt, index and storage of all documents; Ability to identify the status of claim filings and workout efforts; Document location tracking. At the point Claim documentation is received, Radian will review for completeness. Thisreview makes certain all documentation requested has been received but does notreview document content. A Claim is not reviewed and evaluated until all requested information has been receivedin its entirety.
c. Documentation Submission Timeline
Servicers have 90 (ninety) days to respond to any documentation requests.

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Once such a request has been made, no further action will be taken on the claim until the requested documents, or acceptable alternative documents, have been received. Subsequent requests and updates will be sent if the complete file has not been received by the 20th, 40th and 60th day after the claim has been submitted.
d. Missing Documents Claim Denial
In the event the claim submission reaches ninety days, without the required documentation being received by Radian, the system will refer the denial to a Radian Claims Analyst. Servicers have the right to cure a denial and reinstate the claim within the time limits imposed by the terms of Radians Master Policy. Link to Claim Filing
B.
Inability to Evaluate a Claim

If apparent defects in the foreclosure process create sufficient uncertainty that Radian cannot reasonably evaluate a claim, Radian reserves its right under the applicable Policy to classify the claim as unperfected and to withhold a decision on the claim until the apparent defects have been finally resolved. If foreclosures are overturned after Claim payments have been made, Radian again reserves its rights and will address issues on a case-by-case basis.
C.
Action During the Claim Filing Period

1. Eviction of Tenants
In some cases, holdover tenants or mortgagors may still be occupying the property after foreclosure sale. In these cases, the lender must start legal proceedings to evict them in accordance with the requirements of state law.
2. Filing of Claim before Eviction
A Claim for Loss may be filed prior to obtaining physical possession of the property.
D.
Sale of REO Property/Duty to Cooperate

During the 60-day claim-filing period, every effort should be made to sell the property. Servicershave an obligation to promptly list the REO and shall include diligent efforts to marketany property once they have obtained REO title. See Claim Curtailment
1. Listing the Property For Sale
After obtaining title, the Insured must submit for approval any offer that might be acceptable to Radian. Failure to submit an offer for approval may result in an adjustment of the Claim for Loss. In order to protect its interests, the Insureds listing agreement should contain a clause precluding payment of a real estate sales commission if Radian exercises its options to purchase the property as more fully described in Condition Twelve-A, paragraph 1 of RadiansMaster Policy.
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2. REO Purchase Offers
Primary Insurance Any offer for sale of the insured property must be submitted to the Radians REO Administration Department. These submissions can be emailed to REOPrimaryApprovals@radian.biz.
Link to REOApproval Template
Pool Insurance Radian must approve the REO marketing plan, including listing price, adjustments, etc. Any modification to the marketing plan must be approved by Radian. Submissions for pool insured loans can be emailed to REOApprovals@radian.biz. The final sale must be approved along with verification of consistency with the prior Radian approved REO marketing plan.
Link to REO Marketing Request Template
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Claim Review/Evaluation
The purpose of the Claim review process is to confirm Claim eligibility and determine the amount ofLoss incurred as a result of the default.
Link to Claim Eligibility
A.
Review Requirements
The Servicer has filed a timely and accurate Claim. The Claim is perfected. Link to Perfected Claim
B.
Claim Review Timeline

Radians review of the Claim may take up to sixty (60) days. This timeline may be expanded ifaClaims investigation occurs.
1. Access to the Property
If requested, Radian representatives must be allowed access to the property to determine theproperty condition and value. If Radian seeks access to the property, the 60-day period will be suspended until access is made available.
C.
Claims Investigation
As part of the Claim review process, Radian may perform a forensic audit of the Loan file inorderto ascertain: Adherence to applicable eligibility and underwriting guidelines in place at the time theLoanwas originally insured. Adherence to Loan Servicing Requirements and Performance Expectations.
1. Investigative Timeline
Radian may take up to a 120 (one hundred twenty) days to conduct a Claims investigation. During this review, Radian may request additional documentation and isreliant upon the Lenders timely submission of these documents. A Claim can be denied if the additional documentation requested by Radian is not received within 90 days of request.
2. Investigation Process
Radians review and investigation of the Loan file includes the following elements: Reconfirmation of the borrowers information including phone number and address providedon the 1003.
Verification of the borrowers income, assets, employment, occupancy and history ofhousingpayments.
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Default and Claims Servicing Guide | Claim Review/Evaluation
For Stated income Loans; determination of the stated incomes reasonableness with respectto the Borrowers employment and job title. Review of the collateral including a review of the original appraisal, a retroactive AVM, BPO, field review and/or drive-by appraisal. Review of any associated credit reports to determine the borrowers debts and obligations at the time of Loan origination/closing. Questioning of any discrepancies and/or red flags noted within the file documentation which should have been addressed by the Lender during the original underwriting process. Radian may conduct an interview of the borrower, contact the borrowers employer to confirm employment or income, review bankruptcy filings or other court documents available to the public, and review any additional public information such as on websites, which may provide information that is material to Radians investigation. During the investigative review Radian will not: Incent or otherwise encourage, investigators to determine that a Loan was ineligible forcoverage. Incent or otherwise encourage, investigators to pressure the borrower to discuss theLoanifthey are unwilling to do so. Utilize an expired IRS Form 4506T to confirm income.
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Default and Claims Servicing Guide | Claim Review/Evaluation
Claim Disposition
As a result of the Claim review and/or investigation one of three actions are taken: 1.) Claim Fulfillment The Claim proceeds for normal processing. 2.) An Intent to Deny is Issued. Radian intends to deny the Claim because it is not eligible and/or crucial documents requested as part of the review/investigation have not been submitted in a timely manner (90 days). a. Appeal of an Intent to Deny Servicers have the remainder of the Claim filing period, or 30 days, whichever is greater, to resubmit their Claim with the proper documentation and/or supporting information after an Intent to Deny is issued. Radian will continue to accept documents during this time, and will retract a previous Intent to Deny and perform a re-evaluation if the requested documents are received within this timeline. All appeals are to be remitted through siurebuttals@radian.biz.
Link to Claim Filing Period
3.) An Intent to Rescind Coverage is Issued. If the Claim investigation reveals inaccuracies in the application for insurance, underwriter negligence, or other deficiencies in the underwriting process, Radian may conclude that rescission of coverage is warranted. In the event Radian determines a rescission is warranted, a letter of Intent-to-Rescind is sent to the lender providing a description of the facts supporting the decision. The Intent-to-Rescind letter provides a period of time (usually 60 days) for a rebuttal response prior to the rescission being finalized.
Link to Appeal of Rescission
A.
Factors in Rescissions
Radian will establish a good faith belief that the Insured or the Insured agent(s) participated in, were aware of, or, in the exercise of reasonable diligence, should have been aware of, the deficiencies upon which rescission of the mortgage insurance coverage is based. Radian does notshift the burden to the Lender to prove absence of fraud. Missing documentation, on its own, generally will not warrant rescission if the information is not deemed material, and does not prevent Radian from assessing the overall risk that was insured. Below are general evaluation guidelines. This list is not comprehensive and is for illustrative purposes. Many of these factors will not, on their own, warrant rescission action. However, if multiple factors warranting rescission also are present, Radian will take this layering of additional factors into account. If a Lender rebuts Radians decision with information within the variance threshold but outside the underwriting or eligibility guidelines forthe Loan, the rescission decision will not be overturned.
35
Default and Claims Servicing Guide | Claim Disposition
Value An inflated discrepancy in the appraised value by 20% of the amount stated in theapplication for insurance. Debt-to-Income Ratio A recalculated debt-to-income ratio which is 5% above allowable guidelines. Undisclosed debt 5% above allowable guidelines. Assets The amount of assets verified is short $500 for funds to close and/or $1,000 for reservefunds. Material misrepresentation of Verification of Deposit(s) when discovered will warrant rescission. Visibly altered asset documentation such as a bank statement will be considerednegligence by the underwriter. Occupancy For Owner Occupied originated Loans the burden falls to Radian to prove that the borrower never occupied.
B.
Appeal of Rescission
The Servicer has the option to appeal a rescission decision by submitting a rebuttal to Radians Dispute Resolution group at siurebuttals@radian.biz. The appeal review may incorporate many of the same techniques utilized during the Claim investigation, such as borrower/employer interviews and review of public records. If Radians Dispute Resolution group agrees with the lenders position, or if the lender provides additional information sufficient to alter the original decision, coverage will continue or be reinstated and the claim will resume on a normal course towards payment. If the appeal does not support the lenders position, the lender will receive a comprehensive letter of determination explaining the basis for the denial of the appeal. In the event Radian reinstates a rescinded Certificate and honors the claim, the final claim payment willbe adjusted to reflect any premium refund check that may have been disbursed.
36
Default and Claims Servicing Guide | Claim Disposition
10 Claim
Settlement
Radian strives to pay Claims in a fair and prompt manner. Under Radians Master Policy of Insurance, and various structured Pool Policies, Radian has several options in calculating its liability.
A.
Timing of Claim Settlement

Radian will pay a claim within 60 days after all required documentation is submitted, subject tothe following conditions and requirements:
1. Additional Documentation
Radian may request additional documentation within 20 days of the filing date of the initial claim. Until Radian receives the additional documentation, the 60-day time period for claim payment will be suspended.
2. Access
If Radian seeks access to the property, the 60-day period will be suspended until access ismade available.
3. Acquisition
If Radian elects to acquire the property, the 60-day period shall be extended insofar as necessary for there to be 10 days remaining after the insured tenders Merchantable Title toRadian.
4. SIU and Default Servicing Investigations
If the claim is chosen for a quality assurance compliance audit relating to loan origination and/or default servicing, the timeline for payment of the claim shall be extended by an additional 120days from the date of perfection.
5. Late Payment
If Radian does not pay the claim within 60 days, subject to the above conditions, simple interest will be paid at the note rate accruing from the settlement due date. Simple Interest islimited to those claims covered under the Master Policy, and those select Pool Policies thatrefer to the payment of Simple Interest.
B.
Timing of Claim Settlement Under Structured Pool Policies

The Insured should refer to its applicable policy for terms on claim settlement under structured Pool Policies. Questions on status and terms may be directed to customer.care@radian.biz.
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Default and Claims Servicing Guide | Claim Settlement
C.
Calculation of Claim Liability

1. Explanation of Benefits (EOB)
An Explanation of Benefits (EOB) is provided by Radian to the Servicer/Insured for each Claim paid, and is available via MI Online. The EOB provides a categorized itemization of a claim payment. If the claim was filed via EDI260 or via Radians MI Online application, the EOB will be in a side-by-side (Submitted vs. Authorized) format detailing the losses requested in the Insureds claim, compared to the amount for each loss authorized by Radian. If the policy includes a deferred premium, or if any premium is owed to Radian, including premium on principal forgiveness or premium sent to servicers on over turned rescissions, thefinal claim payment will be net of the outstanding deferred premium amount.
2. Claims Adjustments a. The following advances are allowed to be included in a Claim calculation:
Hazard insurance premiums paid after default, pro-rated to 60 days after foreclosure. Real estate taxes accrued or payable after default and prior to foreclosure, pro-rated to60 days after foreclosure. Reasonable and normal disbursements incurred in foreclosure (attorney fees are limitedto3% of UPB and interest). Reasonable and normal property preservation expenses incurred after default and 60days from foreclosure. Reasonable and normal eviction expenses (cash for keys is limited to $1,500 without prior approval). Condominium fees accrued will be pro-rated from the last paid installment to 60 days after foreclosure sale. If a property is subject to a redemption/confirmation period, advances will be pro-rated to the date of the claim or 60 days after redemption/confirmation, whichever comes first.
b. The following advances are not allowed to be included in a Claim calculation:
Insurance premiums and real estate taxes accrued and payable prior to default and after60 days from the foreclosure sale. Property preservation expenses prior to default and after 60 days of foreclosure. Trip charges. MI premiums. Penalties and interest owed on past due taxes, condominium fees, and municipalcharges. Non-approved changes to the terms on an approved sale resulting in an unreasonable reduction in net proceeds.
c. Other Claim Calculation Rules/Adjustments:
Interest is calculated to a maximum of 60 days after the lender has acquired title to theproperty, not to exceed two years from the default date as per the Master Policy.
On short sales, interest is capped to date of short sale.
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Default and Claims Servicing Guide | Claim Settlement
On pool policies and influence sales, interest is capped to date of sale of the property. On third party sales, interest is calculated to date of settlement on third party sale; if settlement date is not available, interest will be calculated on foreclosure sale.
d. Rents Received
Rents received before and after foreclosure mitigate loss for all parties, and therefore shall be deducted from any Claim for Loss filed.
3. Return of Paid Claim Funds
If for any reason a property is reverted back to the homeowner after a claim has been paid (invalid foreclosure, post-foreclosure loss mitigation), it is expected that the servicer/insured willreturn the claim funds to Radian in order for the coverage reinstatement process to begin.
4. Claim Curtailment
Radians Master Policy establishes servicing performance standards of Radian insured loans.
Link to Highest Standard of Servicing Performance
When a servicer fails to service a loan insured by Radian in a reasonable and prudent manner and consistent with the highest standards of servicing in use in the residential mortgage industry as required by the terms of Radians Master Policy, Radian may adjust theloss to reflect the harm it has suffered in the form of increased Loss or risk of loss. Identifieddeviations from servicing best practices are examined in order to determine whetherthey resulted in harm to Radian in the form of an increased risk of loss or missed opportunity to mitigate loss. If it is determined that an identified deficiency did not result in harm, it does not result in a curtailment. Only in those instances where Radian can reasonably calculate the amount by which the deficiency in servicing increased the Loss as calculated under the policy is it required to adjust losses. In all other cases Radian has the contractual right to deny coverage for the entire loss. Rather than deny claims for which deficient servicing has been identified, but for which the resultant loss cant be calculated with arithmetic certainty, Radian makes every effort to accurately estimate the harm it has suffered in the form of increased liability exposure or loss of opportunity to mitigate or abrogate loss. In some instances, however, deficiencies may be so egregious as to require denial of the entire claim.
a. Appeal of Curtailment
Servicers can appeal a curtailment decision by submitting a rebuttal to Radians DisputeResolution Group at siurebuttals@radian.biz. Curtailment decisions are based upon Radians review of servicing notes and related documents provided to Radian by the Insured at the outset of the claim process. Generally, if a required servicing activity is not documented it is deemed not to have occurred. If it is determined that there are missing notes or additional information not previously provided to Radian which document activity, such additional information will be considered on appeal subject to the Limitations of Actions clause and other time constraints within the Master Policy.
39
Default and Claims Servicing Guide | Radian Default and Claims Contact Information
Radian Default and Claims Contact Information
Default Reporting
nodreport@radian.biz
Claims
General inquiries/status: claims.department@radian.biz Claims documents: ClaimsDocumentRequest@radian.biz

Appeals/Rebuttal
siurebuttals@radian.biz
Loss Mitigation
To discuss non-delegated loan retention workouts and liquidation options, please contact your dedicated Loan Specialist.
REO Acquisitions
Primary Insured Loans: REOPrimaryApprovals@radian.biz Pool Insure Loans: REOApprovals@radian.biz
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Default and Claims Servicing Guide | Radian Default and Claims Contact Information
Glossary
Deed-in-lieu of Foreclosure
A transaction where the borrower voluntarily conveys title to the mortgagee lender as an alternative to foreclosure. Any Deed-in-Lieu transactions involvinga release of the Borrower(s) from liability under the Loan require Radian approval. The failure of the Borrower to pay when due an amount equal to or greater thanone (1) monthly regular periodic payment in accordance with the terms ofa Loan. All amounts due and owing under a Loan on which a Default has occurred, and remaining after the conclusion of Appropriate Proceedings, pursuant to applicable state law. The cancellation of coverage as of a date after issuance of the Certificate of Insurance resulting from exclusions in the applicable Policy of insurance, servicer error or non-compliance of the terms of servicing. (Premiums are not refunded, or refunded only of those collected after the date of non-compliance). The failure of the Borrower to make any of the initial twelve (12) monthly payments in accordance with the terms of a Loan so that sums equal to the aggregate of two (2) such monthly payments have not been paid when due. Occurs when the borrower fails to make any of the initial 12 monthly payments, the loan. When an early default occurs, a Notice of Default (NOD) must be reported to Radian within 15 days after the second payment is due. Defaults in some stage between Referral to Attorney date and the Foreclosure Scheduled Date a time-lapse that varies on a state by state basis (i.e., in Alabama 3 months time lapse is allowed between the two dates whereas inMaine, 10 months time lapse is allowed between the two). With respect to an insured Loan, the effective date of mortgage insurance coverage generally the closing date of such Loan, or, such later date as maybe requested by the Insured and approved in writing by Radian. A categorized breakout of a Claim payment contained in a side-by-side format detailing the losses requested in the Insureds Claim, compared to the amount foreach loss authorized by Radian. An EOB is provided by Radian to the Servicer/Insured for each Claim paid. With regard to the amount bid for any Property at a foreclosure sale, the Propertys value at the approximate time of the foreclosure sale as determined by appraisal, if available, or in accordance with customary servicing practices (which may include reliance on information provided by a local real estate broker), subject to applicable law governing foreclosure. A forbearance provides a temporary reduction or suspension of payments on a mortgage loan; and it is typically incorporated in a payment arrangement to cure any delinquent payment after the underlying hardship has gone away. Foreclosure bid price typically reflects the minimum bid acceptable to the lender and normally includes the loan balance, all accrued interest, plus attorneys fees and any costs association with the foreclosure process. The final determinate for foreclosure bid price is dependent on regulatory requirements and/or investor bidding instructions/guidelines. Home Affordable Foreclosure Alternatives is a federal program where a participating mortgage lender/servicer authorize the borrower to sell the property (short sale) for a pre-approved amount to avoid foreclosure. A Deedinlieu of foreclosure may also be an option if selling the property is not viable. The federal government provides monetary incentives to the mortgage servicer and the borrower to participate in the program.
Default
Deficiency
Denial of Coverage
Early Default
Early Payment Default
Early Stage Default
Effective Date
EOB (Explanation of Benefits)
Fair Market Value
Forbearance Plan
Foreclosure Bid Price
HAFA
42
Default and Claims Servicing Guide | Glossary
HAMP
The Home Affordable Modification Program is designed to help financially struggling homeowners avoid foreclosure by modifying loans to a level that is affordable for borrowers now and sustainable over the long term. The program provides clear and consistent loan modification guidelines that the entire mortgage industry can use. Borrower eligibility is based on meeting specific criteria including: (1) borrower is delinquent on their mortgage or faces imminent risk of default; (2) property is occupied as borrowers primary residence; (3)mortgage was originated on or before January 1, 2009 and unpaid principal balance must be no greater than $729,750 for one-unit properties. After determining a borrowers eligibility, a servicer will take a series of steps to adjust the monthly mortgage payment to 31% of a borrowers total pretax monthly income: First, reduce the interest rate to as low as 2%, Next, if necessary, extend the loan term to 40 years, Finally, if necessary, forbear (defer) a portion of the principal until the loan is paid off and waive interest on the deferred amount. (Note: Servicers may elect to forgive principal under HAMP on a stand-alone basis or before any modification step in order to achieve the target monthly mortgage payment) Handle Normal Course. Term used to describe a Claim that is being processed in accordance with Radians guidelines and processes, subject to denial or adjustment based upon Radians rights and privileges under the applicable Policy of insurance Judgment made by the Servicer when a borrower that is not yet in default is faced with circumstances that make default a likely occurrence. The named Insured or any party: (1) to whom coverage has been granted by Radian; or (2) that is a subsequent assignee or transferee owner of a Loan thathas requested to become the insured. If however, Radian has not been notified in writing of such assignment or transfer, or the applicable Policy does not allow transfer of the Loan, Radians sole obligation hereunder shall be to thenamed Insured. Defaults where a foreclosure sale has been held or scheduled or the property associated with the loan has been sold or listed. A transaction that results in an elimination of the Loan. Workout types include short sales, deeds-in-lieu of foreclosure and short refinances. A Liquidating Workout will generally require Radian approval in order to be the basis for filing a Claim under the applicable Policy of mortgage insurance. The indebtedness of the Borrower to the Insured in the amount and for the term specified on the face of the Certificate of Insurance, which is evidenced by a written obligation and secured by a mortgage, deed of trust or other instrument, which is a first lien or charge on the Property, and which is insured under the Master Policy or other applicable Policy or intended to be insured in accordance with the terms of a Commitment of Insurance. Represents a change in the terms of a mortgage contract to incorporate past-due amounts and reduce monthly payment, extend term, reduce interest rate or any combination thereof. A recorded loan modification is a legal change to the terms of the loan and involves obtaining approval from the lender or investor and mortgage insurer. The amount of loss suffered or incurred by the Insured determined pursuant to the provisions of Condition Eleven of the Master Policy. In general, the Loss for primary mortgage insurance coverage will not include the proceeds of the sale of the REO, whereas, the Loss for Pool mortgage insurance coverage will include a credit for the net proceeds of the sale of the REO. Monthly report produced and provided to the lender each month until the loan cures, pays off, or a claim is filed.
HNC (Handle Normal Course)
Imminent Default Insured
Late Stage Default Liquidating Workout
Loan
Loan Modification
Loss
MDR (Monthly Delinquency Report)

43
Merchantable Title
Title to the Property which is readily salable and freely transferable, and which is free and clear of all liens, defects and encumbrances including, without limitation, rights of parties in possession and rights of redemption (unless, in either or both cases, Radian waives in writing its right to take the Property free of such rights), excepting only: (1) The lien of current general real estate taxes and other public charges and assessments not yet due and payable; (2) Easements for public utilities, building restrictions and the effect of building laws or regulations with which the improvements on the Property comply, which do not impair the use of the Property and the improvements thereon for their intended purposes; (3) Tenants under leases approved in writing by Radian; and (4) Such minor imperfections of title as would not impair the use and enjoyment of the Property as a residence. Merchantable Title does not exist if there is a lien on the Property pursuant to federal or state law providing for liens in connection with the cleanup of environmental conditions, or if notice has been given of commencement of proceedings which could result in such a lien. A customized version of Pool insurance, Modified Pool coverage provides coverage to reimburse a lender from its bottom-line loss after the sale of the REO with a per Loan level loss limit based upon a designated percentage of coverage set forth in the Modified Pool policy. A situation where the value of the property used as security on the mortgage Loan is less than the outstanding balance on the loan. Negative Equity loans arealso known as being underwater or upside down. Notification provided by a Servicer to the mortgage insurer advising that the borrower(s) has not made their payments as scheduled and are currently in default status (60 days past due). The Servicer is required to update the insurer of the Loan status monthly until the loan has either cured or gone to a Claim. A Partial Reinstatement is a payment transaction wherein the Borrower(s) paysaportion of the Loan arrears and agrees to a repayment plan for the balance owed. A Claim containing all of the information and proof reasonably required by Radian to evaluate its liability with respect thereto. Any tangible injury to the Property, whether caused by accident, natural occurrence or otherwise, excluding normal wear and tear. Mortgage insurance that insures multiple mortgages (often in a securitization) in a single transaction. Radian insures the individual Loans in a mortgage portfolio up to a specific level of coverage. Pool insurance many times is designed to insure specific layers of risk through the use of Policy deductibles and Aggregate Loss Limits (stop losses) which require the Insured to bear the risk of loss up to a certain dollar amount and also capping Radians liability at a specific dollar limit. Unlike Primary coverage, Pool coverage insures against the Insureds ultimate bottom line loss after the sale of the REO property. A sale transaction where the proceeds are not sufficient to satisfy the outstanding mortgage balance. Since all Policies require the acquisition of Borrowers Title (and/or sale of the REO) in order to trigger a Claim, Radian approval of any PreForeclosure Sale is a condition precedent to filing any Claim where a ShortSale has occurred. Mortgage insurance that is written on an individual loan basis. Also known as flow business, this option is priced and applied on a per-Loan basis. Radian provides coverage by agreeing to pay the Insured a certain percentage of its Loss when a Borrower defaults.
Modified Pool Insurance
Negative Equity (Underwater)
NOD (Notice of Default)
Partial Reinstatement
Perfected Claim Physical Damage Pool Insurance
Pre-Foreclosure (Short) Sale
Primary Mortgage Insurance
44
Property
The residential real property, designed for occupancy by not more than four(4)families, identified on the face of a Certificate of Insurance, and shall include all appurtenances, rights of access and improvements thereon which secure theLoan. Property that a lender has taken title to through Appropriate Proceedings of a Deed-in-Lieu. Title to the REO is passed Radian if it exercises its right to pay the full claim and take title. Represents a payment arrangement plan based on a borrowers financial situation to spread out repayment of a past-due balance over an extended period of time. A repayment plan does not change the original terms of the Loan. The cancellation of the Certificate of Insurance evidencing coverage, effective as of its inception, due to an uninsurable risk existing from the date of the issuance of such Certificate, identified during the course of audit (premiums collected on the certificate are fully refunded). Those liabilities an insurance company is legally required to maintain on its balance sheet with respect to the expected future claim payments of the company. A transaction that results in the cure of a default with the borrower maintaining ownership of their home. A retention workout may be either a repayment plan (with or without forbearance) or a loan modification and results in the borrower retaining their property. Barring a subsequent default on the Loan, a Retention Workout will not result in a Claim under any Policy. Occurs when a loan enters default after the first year of timely loan payments. A Notice of Default (NOD) must be reported to Radian for any loan that is due for three months or more. This must be done no later than 15 days after the third payment is due. A group of investigations with similar characteristics, reviewed as a large scale investigation based on associated data. The entity servicing a Loan on behalf of the Insured. The Servicer is deemed to be the representative of the Insured for purposes of the Master Policy and any applicable Policy under a Special Risk agreement. The date sixty (60) days after receipt of a Claim by Radian, subject to the extensions of time set forth in Condition Thirteen of the Master Policy. A Stipulation Agreement is a post foreclosure initiated agreement which terms require the borrower to waive all defenses to a foreclosure action and for the borrower to make a certain number of payments, in order to be considered for aloan modification or to reinstate the mortgage. A Claim filed by the Insured which includes losses not available at the time of filing of the initial Claim. A Supplemental Claim will be honored by Radian if it contains losses in excess of $25.00 and if it is filed within 60 days of payment of the original Claim, a Supplemental Claim is not mandated under Radians policies of insurance. A misrepresentation or fraud by anyone other than the Insured, its employees or agents. For purposes of this definition, the Insureds agents shall include any mortgage broker and/or intermediary originating the Loan, or anyone under contract with such persons in connection with the origination of the Loan, such as an appraiser or escrow agent. The total unpaid principal balance of a mortgage or note. This term may or may not include capitalized interest depending on applicable regulatory requirements.
REO (Real Estate Owned)
Repayment Plan
Rescission of Coverage
Reserves Retention Workout
Seasoned-Payment Default
Serial Fraud Servicer
Settlement Due Date Stipulation Agreement
Supplemental Claim
Third-Party Misrepresentation orFraud
UPB (Unpaid Balance)
45
Radian Guaranty Inc.

1601 Market Street Philadelphia, Pennsylvania 19103-2337 800.523.1988 215.231.1000
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Default and Claims Servicing Guide

Effective September 17, 2012

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Revision notes

Radian Default and ClaimsServicing Guide

1. Streamlined Information Requirements . 23

1. Limitations of Coverage . . . . . . . . . . . 25 2. Exclusions from Coverage . . . . . . . . . 25 3. Inability to Evaluate a Claim . . . . . . . 26

1. Delegated and Non-delegated Underwriting . . . . . . . . . . . . . . . . . . . . 26 2. Delegated Mortgage Insurance . . . . .26

1. Initial Notification . . . . . . . . . . . . . . . . 14 2. Recurring Reporting Requirements . . . 14 3. Report Delivery . . . . . . . . . . . . . . . . . . 15

1. Required Documentation . . . . . . . . . . 29 2. Document Submission/Receipt . . . . . . 30

1. Eviction of Tenants . . . . . . . . . . . . . . . 31 2. Filing of Claim before Eviction . . . . . . 31

1. Delegated Non-Modification Options . 16 2. Delegated Modification Options . . . 17 3. Non-Delegated Modification Option . . 18

1. Listing the Property For Sale . . . . . . . . 31 2. REO Purchase Offers . . . . . . . . . . . . . 32

1. Access to the Property . . . . . . . . . . . . 33

1. Investigative Timeline . . . . . . . . . . . . . 33 2. Investigation Process . . . . . . . . . . . . . . 33

Effective: September 17, 2012

Default and Claims Servicing Guide | Table of Contents

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Table of Contents

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Introduction

Radian Default and ClaimsServicing Guide

Highest Standard of Servicing Performance

Effective: September 17, 2012

Default and Claims Servicing Guide | Servicing Standards

Radian Default and ClaimsServicing Guide

Servicers Basic Duties and Responsibilities

Effective: September 17, 2012

Default and Claims Servicing Guide | Servicing Standards

Radian Default and ClaimsServicing Guide

Provide initial and continuous training and monitoring of servicing personnel.

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

Effective: September 17, 2012

Default and Claims Servicing Guide | Default Servicing

Radian Default and ClaimsServicing Guide

2. Recurring Reporting Requirements

Link to Monthly Delinquency Report

Default and Claims Servicing Guide | Reporting

Radian Default and ClaimsServicing Guide

Loan Workout/Modification Reporting

Liquidation Reporting Requirements

Default and Claims Servicing Guide | Reporting

Radian Default and ClaimsServicing Guide

Reinstatement Repayment Plan Forbearance Loan Modification

5. Pre-foreclosure (Short) Sale 6. Deed-in-lieu of foreclosure 7. Foreclosure Sale

Effective: September 17, 2012

Default and Claims Servicing Guide | Loss Mitigation

Radian Default and ClaimsServicing Guide

Fully Delegated Retention Workout Options

Default & Servicing

Default & Servicing