Investor Update
October 30, 2018

Source: VA

1. Purpose. This Circular provides clarification regarding a Veteran’s entitlement when a Department of Veterans Affairs (VA) guaranteed home loan is terminated by foreclosure, compromise sale (short sale), or deed-in-lieu of foreclosure (DIL) and a claim under the guaranty is paid.

2. Background. VA guarantees a portion of the loan by the percentage and dollar amount identified on the VA Loan Guaranty Certificate (LGC). If a loan terminates through foreclosure, short sale, or DIL and results in a loss, VA will pay a claim under guaranty and reimburse the loan servicer for their loss, up to the maximum guaranty amount. If the loan originated prior to January 1, 1990, VA may establish a debt against the Veteran and pursue collection.

3. Guidance. VA no longer establishes debts against Veterans on loans originating on or after January 1, 1990. As specified in Title 38 U.S. Code 3703(e), for loans closed after December 31, 1989, Veterans shall have no liability to VA with respect to the loan for any loss resulting from any default except in the case of fraud, misrepresentation, or bad faith. However, Title 38 U.S. Code 3702 (b)(1)(B), requires VA losses to be reimbursed fully by the Veteran in order to restore full entitlement for the reuse of the VA home loan benefit. The loss only affects the Veteran’s entitlement when using the VA Home Loan Guaranty program and does not impact any other VA benefits. Veterans may choose to repay VA to restore their full entitlement or take advantage of any remaining entitlement that may be available.

4. Communication. All communication pertaining to loans originated prior to January 1, 1990, which terminated through foreclosure, short sale, or DIL and resulted in a claim paid under guaranty, can reference an ‘established debt’ in association with the VA home loan benefit, when the debt has not been waived. All communication pertaining to loans closed on or after January 1, 1990, which terminated through foreclosure, short sale, or DIL and resulted in a claim paid under guaranty, should reference a ‘loss’ that must be fully reimbursed by the Veteran in order to restore full entitlement. Reference to an ‘established debt’ in association with these types of loans should not be included in any communication or correspondence unless fraud, misrepresentation, or bad faith has been proven.

5. Rescission: This Circular is rescinded October 1, 2020.

By Direction of the Under Secretary for Benefits

Jeffrey F. London
Director,
Loan Guaranty Service

Investor Update
November 7, 2018

Source: Fannie Mae

Check out two new Investor Reporting eLearnings

Are you new to Investor Reporting? Looking for a refresher? Review the How Modifications Affect Investor Reportingand Resolving Failed Business Rules and Hard RejectseLearnings for an overview on modified loans. Learn how they’re managed in our systems, best reporting practices, and more — all at your own pace. Visit the Servicing Trainingpage for more information.

Changes to Single-Family Master Servicing communications

We’re making small changes to how Single-Family (SF) Master Servicing receives your calls and emails this month.

Here’s what you can expect:

When calling 1-800-2FANNIE, you will be required to enter a valid servicer number to reach an analyst.
When emailing the SF Master Servicing team:
You will receive an auto-response if you do not include your servicer number within your email. Reply to the email with your servicer number (please do not include hyphens or dashes).
You will also receive a “case” number in your auto-response (this will replace what we currently refer to as the “ticket” number).
The subject line of the reply email will contain reference numbers (e.g., [ref:_00De05T6i7._500e0CmRSm:ref]) that allow us to track our correspondence. Please keep the reference numbers in the subject when you respond to the email.
Contact the SF Master Servicing team at master_servicing@fanniemae.com or call 1-800-2FANNIE (Option 1, then Option 6). For assistance using our technology applications, contact the Technology Support Center, available 24/7 (except major holidays), at 1-800-2FANNIE or via web chat.

Join us at these upcoming events:

Nov. 27-28 | MBA Summit on Diversity and Inclusion 2018| Washington, DC
Jan. 28-31 | MBA Independent Mortgage Bankers Conference 2019| San Francisco
Feb. 25-28 | MBA National Mortgage Servicing Conference & Expo| Orlando

View more events.

Investor Update
November 7, 2018

Source: Fannie Mae

The Fannie Mae Modification Interest Rate is subject to periodic adjustments based on an evaluation of prevailing market rates. The servicer must use the current Fannie Mae Modification Interest Rate indicated below when evaluating a borrower for a conventional mortgage loan modification.

NOTE: As a reminder, the interest rate used to determine the final modification terms must be the same fixed interest rate that was used when determining eligibility for the Trial Period Plan and calculating the Trial Period Plan payment.

Investor Update
November 6, 2018

Source: FHFA

August 2018 Highlights

The Enterprises’ Foreclosure Prevention Actions:

The Enterprises completed 24,121 foreclosure prevention actions in August, bringing the total to 4,227,732 since the start of the conservatorships in September 2008. Over half of these actions have been permanent loan modifications.

There were 19,345 permanent loan modifications in August, bringing the total to 2,276,989 since the conservatorships began in September 2008.

Twenty-four percent of modifications in August were modifications with principal forbearance. Modifications with extend-term only accounted for 53 percent of all loan modifications during the month.

There were 752 short sales and deeds-in-lieu of foreclosure completed in August, down 3 percent compared with July.

The Enterprises’ Mortgage Performance:

The serious delinquency rate dropped from 0.84 percent at the end of July to 0.79 percent at the end of August.

The Enterprises’ Foreclosures:

Third-party and foreclosure sales increased from 4,116 in July to 4,643 in August.
Foreclosure starts decreased from 11,639 in July to 11,499 in August.

Attachments:Foreclosure Prevention Report – August 2018