Safeguard Properties

Fannie Mae: Extension of Cost of Funds Index

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Investor Update
July 31, 2019

Source: Fannie Mae

In February 2019, we announced the retirement of ARM plans that use the 11th District monthly weighted-average cost of funds index (COFI) as computed each month by the Federal Home Loan Bank of San Francisco (FHLBank). The FHL Bank had previously announced their intention to cease publishing this index in January 2020, with the December 2019 COFI being the last published rate.

Recently, the FHLBank announced that it will extend publishing of this COFI index for an additional year. The Bank will no longer calculate the index after the publication of the December 2020 COFI on January 29, 2021.

Impact on Loan Servicing

As a courtesy to our customers, we are issuing this Notice to alert servicers of the extension of this index. While we have not determined the substitute index for COFI loans that are being serviced on Fannie Mae’s behalf, we are diligently working with the industry and FHFA on this matter. As soon as the substitute index is determined, we will communicate to servicers accordingly.

Waters Introduces FHA Foreclosure Prevention Act

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Legislation Update
July 25, 2019

Source: U.S. House Committee on Financial Services

Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, introduced legislation that would help prevent foreclosures for borrowers with Federal Housing Administration (FHA) mortgages by strengthening requirements for and increasing oversight of FHA mortgage servicers so that every homebuyer with an FHA mortgage is given a fair chance at avoiding foreclosure.

“The Federal Housing Administration is critical to our housing market and helps to promote homeownership for underserved borrowers, including first-time and minority homebuyers,” said Chairwoman Waters. “Unfortunately, we continue to see significant problems with the servicing of FHA loans that unnecessarily put homeowners at risk of foreclosure. That is why I have introduced the FHA Foreclosure Prevention Act of 2019, which would ensure that FHA servicers help families experiencing financial hardship avoid foreclosure so that they can remain in their homes.”

The FHA Foreclosure Prevention Act of 2019 (H.R. 3958) would require the Department of Housing and Urban Development to increase its oversight of FHA mortgage lenders in an effort to strengthen compliance with the FHA’s loss mitigation requirements. This bill would also establish a robust complaint and appeals process to provide borrowers the ability to adequately voice their concerns about unfair treatment. Ultimately, this bill seeks to ensure that FHA borrowers have a fair opportunity to become current after defaulting on their loan.

Senator Catherine Cortez Masto (D-NV) introduced a companion measure (S. 2279) in the United States Senate today.

“As Nevada’s Attorney General during the housing crisis, I held the Big Banks and mortgage companies accountable for trying to take away the homes of hardworking families in the Silver State,” said Senator Cortez Masto. “Lenders must follow the law before foreclosing on borrowers and that includes communicating transparently and doing everything possible to avoid eviction. Yet loan servicers and mortgage companies are still not following the law when it comes to helping homeowners, which is why my legislation is so important. This bill ensures that lenders put consumers first and take every step possible to keep struggling homeowners in Nevada and across the country in their homes.”

Both measures are supported by the National Housing Law Project (NHLP) and the National Consumer Law Center (NCLC) on behalf of its low-income clients.

To view a one pager, click here.
To view the bill text, click here.

Tropical Storm Erick Approaching Hawaii, Flossie Following

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Updated 8/6/19: AccuWeather published a report detailing the latest location of Tropical Rainstorm Flossie and its possible impacts to the Hawaiian Islands.

Link to report

Updated 8/1/19: The Honolulu Star Advertiser published an article offering updated trajectory and forecast information relating to tropical storms Erick and Flossie.

Link to article

Updated 8/1/19: The Weather Channel published a report offering updated trajectory and forecast information relating to Hurricane Erick and Tropical Storm Flossie.

Link to report

Updated 7/30/19: AccuWeather published a report offering updated trajectory and forecast information relating to Hurricane Erick and Tropical Storm Flossie.

Link to report

Updated 7/29/19: The Weather Channel published a report outlining two tropical storms (Erick and Flossie) as they trek towards Hawaii.

Link to report

Disaster Alert
July 28, 2019

Source: USA Today

Tropical Storm Erick is expected to strengthen into the eastern Pacific Ocean’s latest hurricane as it approaches Hawaii this week.

The weather system organized into a tropical depression more than 1,000 miles southwest of Baja California early Saturday morning before rapidly strengthening into a tropical storm.

“Maximum sustained winds are near 40 mph (65 km/h) with higher gusts,” the National Hurricane Center said in a weather advisory. “Strengthening is forecast, and Erick is expected to become a hurricane by late Monday with continued strengthening through Tuesday.”

Although it’s too early to tell if Erick will be a direct threat to Hawaii, rough surf and increased rip currents will impact the Big Island, Accuweather said.

“Erick would still be almost a week out, so there’s a lot of uncertainty on the exact track,” said Alan Reppert, a senior meteorologist for Accuweather. “Any slight change in that track could really affect any rainfall we see in Hawaii.”

For full article, please click the source link above. 

Is a Recession on the Way?

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Industry Update
July 25, 2019

Source: DS News

According to experts, the next recession is on its way, and could begin next year. According to the Zillow Home Price Expectations Survey, conducted quarterly by Pulsenomics, a panel of more than 100 real estate economists and experts concluded that the next recession will likely begin in 2020.

Half of Zillow’s survey respondents said that the next recession will start in 2020, and around 19% stated that Q3 2019 will likely be the beginning of the recession. Another 35% of experts think the current expansion will end in 2021.

According to Zillow, trade policy will be a driving force behind the next recession, with only a few experts, just 12 respondents, pointing toward housing as a significant factor.

“Housing slowdowns have been a major component, if not catalyst, for economic recessions in the past, but that won’t be the case the next time around, primarily because housing will have worked out its kinks ahead of time,” said Skylar Olsen, Zillow Director of Economic Research. “Housing markets across the country are already heading into a potential correction a solid year before the overall economy is expected to experience the same. The current housing slowdown is in some ways a return to balance that will help increase the resiliency of the housing market when the next recession does arrive.”

Housing may not be the cause, but it will likely still feel the impact of the next recession. About 51% of survey respondents stated that home buying demand will be somewhat or significantly lower in 2020 compared with 2019, and Zillow notes that Homes will likely stay on the market longer and bidding wars will become less common. However, a recession may not result in a plunge in home values. Home prices are predicted to rise 4.1% in 2019, and 2.8% in 2020, down from the Q2 2018 prediction of 2.9% growth.

“More than any other factor with the potential to impact home-buying demand through 2020, mortgage rates are viewed by our expert panel to be most significant,” said Pulsenomics Founder Terry Loebs.

MHA HAMP Update: HAMP Reporting System Maintenance Outage

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Investor Update
July 15, 2019

Source: MHA

Due to a planned maintenance release, the HAMP Reporting System response files will be unavailable Monday, July
29, 2019. During this timeframe, the HAMP Reporting Tool will be available for servicers to submit and upload HAMP
loan data files, and the corresponding Black Knight response files will be provided as usual.

The HAMP Solution Center will not be affected by this outage and may be contacted at support@hmpadmin.com for
any questions.

Freddie Mac: Enhancing Online Navigation with Cowbrowse

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Investor Update
July 19, 2019

Source: Freddie Mac

We’re continuously investing in ways to improve your experience with Freddie Mac. Reducing the amount of time it takes to locate requirements in our Single-Family Seller/Servicer Guide (Guide) on SF.FreddieMac.com is just one area where we’ve focused our efforts.

Beginning today, you can initiate a Glance Cobrowse screen-sharing session with a Customer Support Contact Center (800-FREDDIE) representative to get assistance as you navigate our Guide on SF.FreddieMac.com.

During a Cobrowse session, you’ll be able to:

• Securely share your screen with a Freddie Mac representative. Representatives only see the Guide and will not have access to other information on your computer.

• Get one-on-one support to help you quickly and easily locate information in our Guide.

• Observe best practices for navigating our Guide.

The next time you need to quickly locate an important requirement in our Guide, simply contact the Customer Support Contact Center (800-FREDDIE) and let us help with Cobrowse.

FEMA Declared Disaster Texas

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FEMA Alert
July 17, 2019

FEMA issued a Presidential Major Disaster Declaration for areas in Texas affected by severe storms and flooding that took place June 24-25, 2019.

The following counties are eligible for assistance:

Individual Assistance

  • Cameron
  • Hidalgo
  • Willacy

FEMA Release: Declared Disaster for Texas

ZIP Code List for FEMA Declared Disaster for Texas


Additional Resources

FEMA’s web site

FEMA’s Disaster Declaration Process

Safeguard Properties Industry Alerts

HUD Moratorium on Foreclosure

VA’s Policy Regarding Natural Disasters

Freddie Mac Disaster Relief Policies

Fannie Mae’s Natural Disaster Relief Policies

HUD: FHA INFO #19-34: Single Family Housing Policy Handbook 4000.1 Updated

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Investor Update
July 10, 2019

Source: HUD

Today, the Federal Housing Administration (FHA) published the quarterly update to its Single Family Housing Policy Handbook 4000.1 (SF Handbook). Revisions include updated policy guidance, clarifications, corrections, and additions to SF Handbook Section I (Doing Business with FHA), Section II (Origination through Post-Closing/Endorsement), and Section V (Quality Control, Oversight and Compliance). Today’s publication includes:

• Updated definition of Minimum Decision Credit Score to address application of a median score;
• Clarification of the definition for Net Tangible Benefit, and the addition of a definition for Reduction in Term in the Streamline Refinances section; and
• Clarification of the incident end date policy for when inspections may be performed for properties located in Presidentially-Declared Major Disaster Areas (PDMDAs).

All stakeholders in FHA transactions should review and become familiar with the changes outlined in the SF Handbook Transmittal — available on HUD’s Client Information Policy Systems’ (HUDCLIPS) Housing Handbooks web page. While the PDF version of the SF Handbook is available today, the online version will be updated in the coming days. For reference, a version of the SF Handbook with text changes noted is also available and can be accessed from the SF Handbook Information Page.

Effective Dates
• Changes identified in the Transmittal that are incorporating previously published Mortgagee Letters are effective as previously announced in the corresponding Mortgagee Letter.
• Changes identified in Section II.A. Title II Insured Housing Programs Forward Mortgage may be implemented immediately, but must be implemented for mortgages with case numbers assigned on or after September 9, 2019.
• All other changes reflected in the Transmittal may be implemented immediately, but must be implemented no later than September 9, 2019.

Updates to Supplemental Documents
Concurrent with the release of the updated SF Handbook 4000.1, an updated Appraisal Report and Data
Delivery Guide, and updated Single Family Default Monitoring System codes were also released today.
Both documents are available on the SF Handbook Supplemental Documents web page and are effective September 9, 2019.

Quick Links
• Review the July 10, 2019, SF Handbook 4000.1 Transmittal at:
http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/handbooks/hsgh
• Access the online and/or portable document format SF Handbook 4000.1 from HUDCLIPS Housing Handbooks web page at:
http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/handbooks/hsgh
• View the SF Handbook Supplemental Documents at:
https://www.hud.gov/program_offices/housing/sfh/handbook_references
• View the redline version of the SF Handbook at:
https://www.hud.gov/program_offices/housing/sfh/handbook_4000-1

Resources
Contact the FHA Resource Center:
• Visit our online knowledge base to obtain answers to frequently asked questions 24/7 at:
www.hud.gov/answers.
• E-mail the FHA Resource Center at: answers@hud.gov. Emails and phone messages will be
responded to during normal hours of operation, 8:00 AM to 8:00 PM (Eastern), Monday through
Friday on all non-Federal holidays.
• Call 1-800-CALLFHA (1-800-225-5342). Persons with hearing or speech impairments may reach
this number by calling the Federal Relay Service at 1-800-877-8339.

VA: VALERI Servicer Newsflash

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Investor Update
July 15, 2019

Source: VA

IMPORTANT INFORMATION

Servicer Recorded Training – The recorded May 2019 servicer training is now available and is located under the Servicer Access to VALERI section on the VALERI Internet page at https://www.benefits.va.gov/homeloans/servicers_valeri.asp. The training covers approving access for servicer users, navigating the system, reporting data, filing basic and appealed claims, uploading documents, and viewing reports.

Appeals – The timeframe to file an appeal has been extended in the VALERI application. For cases that would have been eligible for appeal in the legacy VALERI system starting on April 27, 2019, and those that have become eligible in the current VALERI application, the appeal timeframe has been reset to August 12, 2019.

Document Upload – The current maximum document size is 3.8 MB; however, this will be increased in the future. This is not associated with the uploading of the Bulk Upload Templates.

REMINDERS

Contested Foreclosures – Servicers should not be conveying properties to VA if they are aware of issues with the sale or the sale is being contested. In the event the property has already transferred to VA, the servicer should report the Invalid Sale Results event in VALERI. Once the contested foreclosure is resolved, if the sale is still valid, the servicer may re-report the foreclosure sale and Transfer of Custody event in VALERI.

Accessing VALERI – The new VALERI application must be accessed with the Google Chrome browser.
VA Loan Technician Contact Information – Loan Technician contact information is currently located on the VALERI Internet page at https://www.benefits.va.gov/homeloans/servicers_valeri.asp.

Servicer Point of Contact (POC) Information – Servicer Account Department POC information should be populated by an Administrator in the VALERI application as soon as possible. Along the header bar in the VALERI application, servicer administrators can select the drop-down arrow next to “More”, then select “Servicer Departments” to add the contact information.

VALERI Assistance – Any VALERI system related inquiries must be directed to valeri.vbaco@va.gov. Policy inquiries should still be directed to the VALERI Helpdesk at valerihelpdesk.vbaco@va.gov.

Servicer Webinar – Servicers are encouraged to attend the next webinar on July 25, 2019, at 1:00 PM EST, which will focus on VALERI Reports. Requests for webinar information, for those who have not previously attended, should be directed to the VALERI Helpdesk at valerihelpdesk.vbaco@va.gov at least 48 hours prior to the webinar.

Freddie Mac: FHLMC Guide Bulletin 2019-12: Servicing Updates

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Investor Update
July 12, 2019

Source: Freddie Mac

We’re making changes to simplify servicing mortgages for Freddie Mac. Today’s Single-Family Seller/Servicer Guide (Guide) Bulletin 2019-12 announces updates related to:

  • Deed-in-lieu of foreclosure inspection requirements.
  • EDR Codes.
  • Subsequent transfer of servicing requirements for mortgages registered with MERS.
  • Escrow.
  • Exhibit 33, Acknowledgement Agreement Incorporated Provisions.

For details on these updates and more, please read Guide Bulletin 2019-12.