MHA Supplemental Directive 15-07 Making Home Affordable Program ? Handbook Mapping for Streamline HAMP
Investor Update
August 11, 2015
In February 2009, the Obama Administration introduced the Making Home Affordable (MHA) Program to stabilize the housing market and help struggling homeowners obtain relief and avoid foreclosure. In March 2009, the U.S. Department of the Treasury (Treasury) issued uniform guidance for loan modifications by participants in MHA across the mortgage industry and subsequently updated and expanded that guidance. On June 1, 2015, Treasury issued version 4.5 of the Making Home Affordable Program Handbook for Servicers of Non-GSE Mortgages (Handbook), a consolidated resource for guidance related to the MHA Program for mortgage loans that are not owned or guaranteed by Fannie Mae or Freddie Mac (Non-GSE Mortgages).
On July 1, 2015, Treasury issued Supplemental Directive 15-06 announcing a “streamlined” modification process under the Home Affordable Modification ProgramSM (HAMP®) for Non-GSE Mortgages (referred to as Streamline HAMP). Streamline HAMP is designed to assist borrowers who meet basic HAMP eligibility criteria and, among others, those who have not completed an application by the time their loan is 90 days delinquent.
This Supplemental Directive provides mapping of the Handbook for the guidance provided in Supplemental Directive 15-06 and provides further administrative clarifications on such guidance. Servicers that are subject to or adopt the guidance in Supplemental Directive 15-06 must follow the guidance set forth in this Supplemental Directive. This guidance does not apply to mortgage loans that are owned, securitized or guaranteed by Fannie Mae or Freddie Mac (each, a GSE), or insured or guaranteed by the Veterans Administration, the Department of Agriculture’s Rural Housing Service (RHS) or the Federal Housing Administration (FHA).
Handbook Mapping
Supplemental Directive 15-06 amended and superseded the notated portions of the Handbook. Attached to this Supplemental Directive as Exhibit A is the mapping of the Handbook which delineates the changes thereto attributable to the guidance provided in Supplemental Directive 15-06. The changes to the Handbook described in this Supplemental Directive are effective as of January 1st, 2016.
Administrative Clarifications
Non-Approval Notices
Supplemental Directive 15-06 requires that a servicer send a Non-Approval Notice to a borrower in a Streamline HAMP trial period plan who makes timely payments but fails to return the executed Streamline HAMP documents (i.e., the Streamline HAMP Affidavit and/or the Streamline HAMP Modification Agreement) on a timely basis. This Supplemental Directive clarifies this requirement such that any HAMP borrower who is in a trial period plan but fails to return the applicable permanent modification documents must be sent a Non-Approval Notice indicating the failure to return the required documentation.
The model clauses for borrower notices in Exhibit A to the Handbook have been updated to reflect this guidance. An updated list of reason codes will also be made available in the HAMP Additional Data Requirements Data Dictionary at www.HMPadmin.com.
Please click here to view SD 15-07 [pdf] in its entirety.
