The Notes will be Radian’s senior unsecured obligations and will rank:

•   senior in right of payment to Radian’s existing and future indebtedness that is expressly subordinated in right of payment to the Notes;

•   equal in right of payment to Radian’s existing and future unsecured indebtedness that is not so subordinated;

•   effectively subordinate to any of Radian’s secured indebtedness, to the extent of the value of the assets securing such indebtedness; and

•   structurally subordinate to all existing and future liabilities, including claims with respect to insured policies and trade payables, of Radian’s subsidiaries.

Radian may not redeem the Notes prior to March 8, 2016. At any time on or after March 8, 2016, Radian may redeem all or part of the Notes, but only if the last reported sale price of its common stock for 20 or more trading days (whether consecutive or not) in a period of 30 consecutive trading days, ending on, and including, the trading day prior to the date Radian provides notice of redemption exceeds 130% of the conversion price in effect on each such trading day. The redemption price will be equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. No “sinking fund” is provided for the Notes.

In the case of any optional redemption, Radian will provide not less than 30 nor more than 60 calendar days’ notice before the redemption date to the trustee, the paying agent and each holder of Notes. See “Description of the Notes—Optional Redemption” in the Notes Preliminary Prospectus Supplement.

Public offering price (1)

Underwriting discounts and commissions (excluding Notes sold to an investor identified by Radian) (2)

Proceeds to Radian (before expenses) (2)

Effective Date

March 4, 2013

March 1, 2014

March 1, 2015

March 1, 2016

March 1, 2017

March 1, 2018

March 1, 2019

If the stock price is between two stock prices in the table or the effective date is between two effective dates in the table, the number of additional shares will be determined by a straight-line interpolation between the number of additional shares set forth for the higher and lower stock prices and the earlier and later effective dates based on a 365-day year, as applicable.

If the stock price is greater than $75.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate.

If the stock price is less than $8.00 per share (subject to adjustment in the same manner as the stock prices set forth in the column headings of the table above), no additional shares will be added to the conversion rate.

Common Stock Offering

Public offering price

Underwriting discounts and commissions (excluding Shares sold to an investor identified by Radian) (1)

Proceeds to Radian (before expenses) (1)

The net proceeds from the Notes Offering, after deducting the underwriting discounts and commissions and estimated offering expenses, are expected to be approximately $341.3 million (or approximately $389.8 million if the underwriters exercise in full their option to purchase additional Notes). No underwriting discount will be paid to the underwriters with respect to $75 million principal amount of Notes purchased in the Notes Offering by an investor identified by Radian.

The net proceeds from the Stock Offering, after deducting the underwriting discounts and commissions and estimated offering expenses, are expected to be approximately $260.7 million (or approximately $299.5 million if the underwriters exercise in full their option to purchase additional Shares). No underwriting discount will be paid to the underwriters with respect to 5,000,000 Shares purchased in the Stock Offering by an investor identified by Radian.

Radian intends to use the net proceeds from the Notes Offering and Stock Offering to fund working capital requirements and for general corporate purposes, including additional capital support for its mortgage insurance business.

The following table shows Radian’s cash, cash equivalents and short-term investments and capitalization at December 31, 2012 on an adjusted basis to reflect the Notes Offering and Stock Offering and related use of proceeds, as described above.

As adjusted to include the sale of the Notes in the Notes Offering and the Shares in the Stock Offering, assuming that the underwriters do not exercise their option to purchase additional Notes in the Notes Offering or to purchase additional Shares in the Stock Offering, Radian’s total consolidated long-term debt as of December 31, 2012 would have been approximately $865.0 million and would have represented approximately 43.2% of Radian’s capitalization as of that date.

Cash, cash equivalents, restricted cash and short-term investments

Short-term obligations:

5.625% Senior Notes due 2013 (1)(2)

Long-term obligations: (1)(3)(4)

5.375% Senior Notes due 2015 (2)

3.00% Convertible Senior Notes due 2017

2.25% Convertible Senior Notes due 2019 (5)

Total long-term obligations

Shareholders’ equity

Preferred Stock, par value $.001 per share; 20,000,000 shares authorized; none issued or outstanding

Common Stock, par value $.001 per share; 325,000,000 shares authorized; 151,131,173 issued and 133,647,216 outstanding (6)

Treasury Stock, at cost, 17,483,957 shares

Additional paid-in capital

Retained (deficit) earnings

Accumulated other comprehensive income

Total Shareholders’ Equity

Total Capitalization

Trade date:

Morgan Stanley & Co. LLC

Goldman, Sachs & Co.

Morgan Stanley & Co. LLC

Goldman, Sachs & Co.

Dowling & Partners Securities, LLC

Keefe, Bruyette & Woods, Inc.

Macquarie Capital (USA) Inc.

Wells Fargo Securities, LLC