RALEIGH, N.C., Oct. 27 NC-Genworth-HFA-prtct
RALEIGH, N.C., Oct. 27 /PRNewswire-FirstCall/ -- Genworth Financial, Inc.
(NYSE: GNW) said today that its U.S. Mortgage Insurance division was making
recapture tax protection available on all Genworth insured primary loans with
participating Housing Finance Agencies (HFAs).
The new program covers HFA borrowers for nine years, reimbursing them up
to $6,000 on any federal recapture tax they might incur in selling their
homes.
"This protection will provide peace of mind for HFA borrowers concerned
about tax liability if they sell their homes," said Rohit Gupta, senior vice
president Products, Market Intelligence and Strategy of Genworth Mortgage
Insurance. "Available at no cost to either lender or borrower, it's another
example of our commitment to providing safe, secure mortgage solutions for low
down payment borrowers."
Recapture tax is a federal tax that can apply to homeowners who financed
the purchase of their home through proceeds of tax-exempt Mortgage Revenue
Bonds or with Mortgage Credit Certificate Program assistance, both of which
are common with HFA loans. Should they sell or dispose of the home or an
interest in the home within nine years after the mortgage loan closing, those
homeowners, under certain circumstances, may have increased federal income tax
liability for the year in which they sell or otherwise dispose of the
property.
The maximum recapture tax is 6.25% of the original principal balance of
the loan. To determine their liability, homeowners should refer to the
disclosure received from the Housing Finance Agency or lender explaining the
potential tax, or consult with a tax advisor.
"Housing finance authorities are faced with imposing a recapture tax on a
sale of a home," said Robert Strickland, Executive Director, Alabama Housing
Finance Agency.
"This potential tax on a borrower is being eliminated by Genworth's
Recapture Tax Protection. We are excited about this offering as part of the
mortgage insurance so that the homebuyer gets peace of mind with additional
coverage for potential recapture tax."
To get reimbursed up to $6,000 for any tax paid, borrowers file a claim
with the Genworth Recapture Tax Benefits Administrator. Benefits are
considered personal income, and borrowers should consult with a tax advisor on
the taxability of recapture tax reimbursement.
All Genworth insured primary loans with participating HFAs will receive
the Recapture Tax Protection automatically, with coverage lasting up to nine
years as long as Genworth mortgage insurance is in force. There are no changes
in the current submission process for HFA loans to Genworth.
About Genworth
Genworth Financial, Inc. (NYSE: GNW) is a leading public Fortune 500
global financial security company. Genworth has $114 billion in assets and
employs approximately 7,000 people in 25 countries. Its products and services
help meet the investment, protection, retirement and lifestyle needs of over
15 million customers. Genworth operates through three segments: Retirement and
Protection, International and U.S. Mortgage Insurance. Its products and
services are offered through financial intermediaries, advisors, independent
distributors and sales specialists. Genworth Financial, which traces its roots
back to 1871, became a public company in 2004 and is headquartered in
Richmond, Virginia. For more information, visit http://www.genworth.com.
The Recapture Tax Protection is underwritten by Dealers Assurance
Corporation and is subject to conditions, exclusions and exceptions not
necessarily included in this summary. This summary does not change the terms
of the recapture plan.
SOURCE Genworth Financial, Inc.
