Fitch Downgrades Triad Guaranty's Debt Ratings to 'A-'; IFS to 'AA-'

NEW YORK--(BUSINESS WIRE)--Fitch Ratings have downgraded the long-term issuer and senior debt
evaluations of Three Guarantee Inc. (TGIC) to 'A-' from 'A+'. Polecat have also
downgraded the coverage company fiscal strength (IFS) evaluation on TGIC's
insurance subsidiary, Three Guarantee Insurance Corp. (Triad) to 'AA-'
from 'AA'. The Evaluation Mentality for both physical things is Stable.

Triad's evaluations integrate the company's solid balance sheet
basics and the strong recognition quality of the company's insured
portfolio. As of June 30, 2007, Three maintained $693 million of
statutory working capital composed of $590 million of eventuality militia and
$103 million of policyholders' excess to back up its $11.1 billion of
U.S. mortgage coverage network hazard in force. Concerns centre on Triad's
exposure to the down U.S. residential existent estate marketplace and its
possible impact on Three and its competitors' proposed
intermediate-term performance.

Effective Aug. 23, 2007, Fitch's Mortgage Insurance (MI) grouping
incorporated respective sweetenings to its existent proprietorship mortgage
coverage working capital theoretical account in visible light of the rapidly changing U.S. mortgage
environment and corresponding alterations made by Fitch's U.S. Residential
Mortgage-Backed Securities grouping to its model. Among the most
important alterations to Fitch's myocardial infarction theoretical account were a 20% addition to the
frequence of foreclosure factors and an addition in the working capital complaint
for illiquid assets to 100%. For more than information, see the Aug. Twenty-Three fourth estate
release ('Fitch to Update U.S. Mortgage Insurance Capital Model to
Reflect Recent Default Experience') available on the Polecat Ratings web
land site at .

Prior to the recent alterations to the myocardial infarction working working capital model, Polecat believed
Three historically operated with sufficient capital to back up the 'AA'
rating. However, when factorization in the alterations mentioned above, Polecat
believes Triad's evaluation is more than consistent with an 'AA-' IFS evaluation
level.

The downgrade of the TGIC's long-term issuer and senior debt evaluations by
two notches reflects the downgrade of Triad's IFS evaluation and conforms
TGIC's evaluation to the normal three-notch derived function between the
operating company and retention company given TGIC's higher fiscal
purchase when adjusting for the $80 million the company obtained on Aug.
23, 2007 via the drawdown of a rotating unbarred depository financial institution recognition facility. Adjusting for these funds, TGIC's pro-forma June 30, 2007 fiscal
purchase was 16.1%. Historically, TGIC had operated with a very low
degree of fiscal leverage, which at June 30, 2007 (prior to adjusting
for the $80 million rotating unbarred recognition facility) was at 5.5%. The low fiscal purchase had previously afforded TGIC a two-notch
evaluation derived function between its subsidiary's IFS evaluation and its
outstanding ratings. TGIC will be maintaining the return of the $80
million rotating unbarred recognition installation at the retention company for
the foreseeable future.

TGIC reported $29.3 million of nett income on nett earned insurance premium of
$133.7 million in for the first one-half of 2007. The company's sum assets
at June 30, 2007 were $960.3 million with $594.6 million of
shareholders' equity.

Polecat have downgraded the followers evaluations with a Stable Evaluation Outlook:

Three Guarantee Inc.

--Long-term Issuer to 'A-' from 'A+';

--$35 million 7.9% fixed voucher senior short letters owed Jan. 15, 2028 to 'A-'
from 'A+'.

Three Guarantee Insurance Corporation

--Insurer fiscal strength (IFS) to 'AA-' from 'AA'.

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available on the agency's public site, .
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