Radian Guaranty Inc., the mortgage insurance subsidiary of Radian Group Inc. (NYSE: RDN), today announced that it entered into a Master Transaction Agreement with Freddie Mac on August 29, 2013. The Agreement relates to a group of 25,760 first-lien mortgage loans held by Freddie Mac that were insured by Radian Guaranty, and were delinquent as of December 31, 2011. The Agreement provides for the future treatment of these loans including claim payments, loss mitigation activity and insurance coverage, and eliminates Radian Guaranty’s claim exposure on 9,756 loans that were delinquent and 4,586 loans that were re-performing as of July 31, 2013. “One of our top priorities for our mortgage insurance business is to actively reduce our legacy exposure,” said Radian’s Chief Executive Officer S.A. Ibrahim. “This agreement is an important step in resolving our remaining legacy risk, and reduces our total number of primary delinquent loans by 12.6 percent.” The Agreement caps Radian Guaranty’s total exposure on this group of loans, including loans that are currently re-performing, to $840 million. Radian Guaranty paid approximately $255 million to Freddie Mac to cover claim exposure on these loans, and had previously paid $370 million of claims on these loans. Radian Guaranty also deposited $205 million in a collateral account to cover loss mitigation activity on these loans. Amounts in the collateral account will be released to Radian Guaranty to the extent that Radian Guaranty rescinds, denies, or curtails these loans and such amounts become final under the Agreement. As of July 31, 2013, the amount of insurance rescissions, claim denials or claim curtailments that had become final in accordance with the Agreement was approximately $10 million. In addition, as of July 31, 2013, another $140 million of submitted claims had been rescinded, denied or curtailed but were not considered final under the Agreement. If the loss mitigation activities do not accumulate to $205 million, any remaining funds will be paid to Freddie Mac. Radian Guaranty will administer all claims submitted with respect to these loans in accordance with its insurance policy for these loans and in a manner consistent with its normal claims handling practices.