All insured loans are to be reported on a monthly basis where arrears is greater than or equal to 60 days. Reporting must continue each month thereafter until the arrears either fall under the 60-day threshold, have been cured by way of loan payout or a claim has been paid.
Genworth's requirements for loss mitigation
Frequently asked questions
A monthly report is to be submitted outlining all insured loans within the reportable period (eg loans in arrears 60 days or greater). Genworth must receive the report within 14 days of the preceding calendar month.
Legal action should commence as required in line with the legislative requirements for the property. The action taken should be reported in your monthly report. If you are unsure of the action taken, or problems arise during the process, consult with your Genworth Loss Mitigation consultant.
Ensure that your Loss Mitigation consultant is aware of the situation and kept up to date with the action taken on the property.
Formal possession must be advised within 14 days of it being obtained. Contact your Genworth Loss Mitigation consultant and they will advise you of Genworth’s standard requirements. Ensure that the property is secure.
From the time possession has been obtained, regular contact with your Genworth Loss Mitigation consultant should be maintained. You may require approval to certain costs associated with the sale and the listing or reserve prices of the insured property.
You need to advise your Genworth Loss Mitigation consultant that settlement has occurred and confirm whether a claim will be lodged.
Loss mitigation solutions
Unexpected events such as sudden job loss, reduced income, illness, marital breakdown or other life changing situations, can have a devastating impact on a home owner’s financial wellbeing and may impede their ability to meet their loan repayments.
Genworth’s loss mitigation solutions are designed to provide short-term support to help families stay in their homes while they sort through their difficult situation.
In some circumstances it isn’t always possible for the borrower to stay in their home, or keep an investment property, as their situation cannot be resolved. By providing an opportunity for the borrower to sell their property with the support of our property experts along with additional support such as debt release, the home owner can exit their property in a dignified and most cost-effective manner.
By avoiding the mortgagee-in-possession process, we not only help prevent a family from losing their home, but we also avoid a claim and help preserve the stability of our housing market. While a solution may not be available in every case, we take great pride in helping those we can, mainly through loan term extensions, reduced or deferred repayments or capitalisation of arrears.
Below are further details on our various programs. The key to our support is that every case is treated on a case-by-case basis and solutions are tailored to the needs of your borrower.
Financial difficulty can arise from different life events such as changes in income, illness, a relationship breakdown, reduced cash flow or emergency events like natural disasters. Loans insured with Genworth are eligible for mortgage assistance when a borrower experiences financial hardship. Hardship occurs where a borrower is experiencing difficulty in meeting repayments under their contractual loan obligations. Genworth’s insurance benefits include solutions that improve mortgage affordability so borrowers can keep their homes or transition into a financially stable lifestyle.
Borrowers may have extenuating circumstances that:
- Require temporary assistance with servicing their home loan repayments and formulating appropriate solutions, and
- Have no reasonable prospects of servicing their loan, thus working with the lender to mitigate a loss to the borrower, the lender, and to Genworth.
Hardship assistance is timely support that can be provided to a borrower who is in financial distress. A successful hardship solution could:
- Assist a borrower through a difficult period avoid a foreclosure situation.
- Provide a borrower the opportunity and time to sell their own property.
- Avoid any future debt collection activity.
When should you contact us?
If your borrower has a Genworth insured loan they can take advantage of our Hardship Program.
We are here to help no matter what the situation is, whether someone has lost their job, is earning less money, has over-committed themselves, had their business fail, are sick or injured, have been affected by a relationship breakdown or a natural disaster.
If you are in any doubt just contact our team at hardshipsAU@genworth.com
Our team of specialists will work in partnership with you to match the type of assistance to the need of your borrower. We will aim to ensure all genuine hardship requests receive the best solution to assist your borrower to stay in their home.
Types of assistance available
Common types of assistance we support include:
- capitalisation of arrears
- deferred repayments
- repayment arrangement
- reduced repayments
- conversion of loan to interest-only
- loan term extension
- time to seek financial counselling advice
- time to sell (see Borrower Sale below).
Borrower Sale program
For a borrower experiencing difficulties meeting their loan repayments, one of the hardest decisions they will have to make is to sell their home. It is important they speak to their lender or broker and are encouraged to seek independent financial and/or legal advice before doing so to ensure they make the correct decision.
When it is clear a borrower experiencing difficulties meeting their loan repayments is not able to remedy their situation, it may be in their best interest to make the decision to sell their home as soon as possible. This decision may reduce or avoid any potential shortfall by utilising equity in their home and achieving a better sale price.
Genworth’s team of Loss Mitigation consultants’ include qualified real estate agents who will work in partnership with you and your borrower on any borrower shortfall sale scenario providing guidance and recommendations on:
- timeframe to sell
- real estate marketing campaigns
- list price and sale offers
- costs that Genworth may cover such as moving costs
- a portion of debt release of the shortfall claim amount.
Below are some tools and guidelines we have prepared that will assist you and your borrower if they are considering selling their home.
- Borrower frequently asked questions
- Selecting a real estate agent
- Choosing the right marketing campaign and sale method
- Presenting your property for sale
- What should you expect from your real estate agent?
Other loss mitigation solutions
When a borrower who is experiencing financial difficulties is regrettably unable to recover from their situation, it may not always be practical for them to sell their property. In these cases we recognise it may be necessary for you to commence legal proceedings to secure possession and sell the property as the mortgagee.
Genworth’s team of specialists will work in partnership with you providing guidance and recommendations on:
- potential cure solutions (eg re-aging opportunities)
- litigation timelines
- solutions to reduce unnecessary legal costs
- voluntary surrender opportunities
- industry best practices
- re-examining borrower sale opportunities
- case-by-case exceptions.
If your borrower has a Genworth insured loan, contact a representative of the Loss Mitigation team so we can provide our support through the litigation process.
Our approach is flexible and can be tailored to suit your needs including deployment of on-site Genworth resources, dual access to third party legal portals or case-by-case consultation.
At all times, we will look to provide tailored solutions that ensure the interests of your borrower are always kept in mind and any potential shortfall is minimised by identifying potential cure solutions that may keep a borrower in their home or otherwise securing a Borrower Sale or timely possession.
Mortgagee-in-possession (MIP) sales occur as a last resort when a borrowers financial difficulties are regrettably unable to be resolved and they have chosen not to sell their property themselves. In this situation, Genworth will work with you to ensure the ‘duty of care’ owed to the borrower is upheld throughout the MIP sale process. Genworth's Loss Mitigation consultants include qualified real estate agents and licensed valuers that will work in partnership with you, providing guidance and recommendations on:
- preparation of properties for sale to ensure the best sale price is achieved
- selection of real estate agents
- best method of sale
- reducing unnecessary sale costs and expenses
- industry best practices.
If your borrower has a Genworth insured loan, contact a representative of the Loss Mitigation team as soon as you are in possession of the property. We will proactively assist you through every step of the MIP sale process.
Our approach is flexible and can be tailored to suit your needs including deployment of on-site Genworth resources, direct portfolio management, dual access to property presenter portals or case-by-case consultation.
At all times, we will look to provide tailored solutions that ensure the interests of your borrower are always kept in mind and any potential shortfall is minimised.
The following links provide useful information and advice for lenders and borrowers on how to deal with borrowers that are experiencing difficulties in meeting their loan repayments.