Page 291 – Safeguard Properties

FHFA: Foreclosure Preventions Top 4.1 Million In FHFA’s 2018 First Quarter Report”

Posted on September 13, 2018 by Safeguard

Investor Update
June 21, 2018

Source: FHFA

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today released its first quarter 2018 Foreclosure Prevention Report, which shows that Fannie Mae and Freddie Mac (the Enterprises) completed 68,378 foreclosure prevention actions in the first quarter of 2018, bringing the total number of foreclosure prevention actions to 4,108,636. The Enterprises’ serious delinquency rate dropped to 1.1 percent at the end of the first quarter.

FHFA’s report includes data on the Enterprises’ mortgage performance, delinquency data by state, and real estate owned (REO) inventory. FHFA publishes the report data in an online, interactive Borrower Assistance Map on FHFA.gov.

Link to Report

Contacts:
Media: Stefanie Johnson (202) 649-3030 / Corinne Russell (202) 649-3032

Consumers: Consumer Communications or (202) 649-3811

FHFA: Fifth Report on Non-Performing Loan Sales Released

Posted on September 13, 2018 by Safeguard

Investor Update
June 13, 2018

Source: FHFA

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today released its fifth report providing information about the sale of non-performing loans (NPLs) by Fannie Mae and Freddie Mac (the Enterprises). The Enterprise Non-Performing Loan Sales Report includes information about NPLs sold through December 31, 2017, and reflects borrower outcomes as of December 31, 2017 on NPLs sold through June 30, 2017. The sale of NPLs reduces the number of delinquent loans in the Enterprises’ portfolios and transfers credit risk to the private sector. FHFA and the Enterprises impose requirements on NPL buyers designed to achieve more favorable outcomes for borrowers than foreclosure.

This fifth report shows that, through December 31, 2017, the Enterprises sold 90,921 NPLs with a total unpaid principal balance (UPB) of $17.4 billion.

In 2017, 18,419 NPLs were sold, compared to 44,169 sold in 2016.
NPLs sold had an average delinquency of 3.2 years and an average current loan-to-value ratio of 95 percent.
NPLs in New Jersey, New York and Florida represented nearly half (46 percent) of the NPLs sold. These three states accounted for 47 percent of the Enterprises’ loans that were one year or more delinquent as of December 31, 2014, prior to the start of NPL program sales in 2015.

The borrower outcomes in the report are based on the 79,638 NPLs that were settled by June 30, 2017 and reported through December 31, 2017. These outcomes reflect the following:

Compared to a benchmark of similarly-delinquent Enterprise NPLs that were not sold, foreclosures avoided for sold NPLs were higher than the benchmark.
NPLs on homes occupied by borrowers had the highest rate of foreclosure avoidance outcomes (25.7 percent foreclosure avoided versus 11.5 percent for vacant properties).
NPLs on vacant homes had a much higher rate of foreclosure, nearly double the foreclosure rate of borrower-occupied properties (59.5 percent foreclosure versus 24 percent for borrower occupied properties). Foreclosures on vacant homes typically improve neighborhood stability and reduce blight as the homes are sold or rented to new occupants.
Twenty one percent of the permanent modifications of NPLs provided arrearage and/or principal forgiveness. The average forgiveness earned per loan to date was $51,452 (with the potential to earn an average forgiveness of $73,361).

FHFA will continue to provide reporting on NPL sales borrower outcomes on an ongoing basis.

Link to Non-Performing Loan Sales Report

Link to NPL page on FHFA.gov

Contacts:
Media: Corinne Russell (202) 649-3032 / Stefanie Johnson (202) 649-3030

Consumers: Consumer Communications or (202) 649-3811

Fannie Mae: Servicing Guide Updates; New Consolidated Forbearance Plan; and More

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
June 13, 2018

Source: Fannie Mae

Announcement SVC-2018-04: Servicing Guide updates

The Fannie Mae Servicing Guide has been updated with changes that:

Provide forbearance plan options that:
Assist borrowers experiencing a short-term hardship; and
Remove the requirement for servicers to grant separate relief during the 90-day period when attempting to contact a borrower impacted by a disaster.
Respond to servicer feedback by removing the time frame associated with servicer reimbursements for escrow advances on delinquent loans.
Clarify servicer requirements for submitting Form 1022, the Servicemembers Civil Relief Act (SCRA) Reporting and Disbursement Form.

For a summary of key updates in Servicing Guide Announcement SVC-2018-04, view the executive perspectives video presented by Jenise Hight, Director of Servicing Policy, and the executive overview from Carlos Perez, Chief Credit Officer for Single-Family.

New consolidated forbearance plan

We continue to look for ways to bring simplicity and certainty to servicing by streamlining our current forbearance plan workout options into a single policy. This change will simplify the overall forbearance plan offerings into one program to create a better experience for servicers. Servicers are encouraged to implement these policy changes immediately, but no later than Dec. 1. Please contact your Fannie Mae Servicing Account Manager with any questions.

SMDU enhancements coming this weekend

This weekend, we will implement enhancements to Servicing Management Default Underwriter™ (SMDU™). Please refer to the release notes for more information. During implementation, SMDU will be unavailable to process transactions from 10 p.m. ET on Friday, June 15 through 11 a.m. ET on Saturday, June 16. Visit the SMDU web page or contact your Fannie Mae Servicing Account Manager for more information.

New UI enhancements to SURF

Servicer’s Reconciliation Facility™ (SURF™) will be upgraded on July 7 to enhance the software and the appearance of the application. In addition, users will no longer be required to configure browser settings to Internet Explorer 8 to receive the exception messages. Google Chrome will also be compatible with this enhancement. View additional Fannie Mae technology requirements.

Updated CRS remittance codes

As a component of Simplifying Servicing™, we updated the Cash Remittance System (CRS) remittance codes. A revised list of the CRS 300 series code names and descriptions is available on the CRS page.

Join us at these upcoming events:

View more events.

Recent Tweets

Last year, three out of four homebuyers in the U.S. seeking mortgages chose a 30-year fixed-rate mortgage. We are fortunate to work with incredible partners who educate homebuyers about how they may be able to own a home. #HomeownershipMonth #KeyPartners

June 13

Mortgage demand hits a three-year low in our latest Mortgage Lender Sentiment Survey. #MLSS
http://bit.ly/2JPm7Ik

June 12

Fannie Mae: Modification Interest Rate Adjustment Update

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
June 7, 2018

Source: Fannie Mae (full exhibit)

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.

Fannie Mae: LoanSphere Invoicing and SURF Enhancements; and More

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
June 27, 2018

Source: Fannie Mae

LoanSphere Invoicing enhancements simplify expense reimbursement

We’ve added a “Vacancy Posting” line item to LoanSphere Invoicing™ under “Category 19: Property Services” and “Subcategory 8089: Vacancy Posting.” And, coming soon, we’ll add a new “Referral Date” field to further simplify expense reimbursement. Beginning Sept. 1, servicers must populate the new field in the “Title Cost – Foreclosure” expense line item with the foreclosure referral date, which is required for reimbursement of foreclosure title cost expenses. Visit the Servicer Expense Reimbursement page for more information and view the full list of LoanSphere Invoicing servicer expense categories and subcategories for conventional loans.

New UI enhancements to SURF

Servicer’s Reconciliation Facility™ (SURF™) will be upgraded on July 7 to enhance the software and the appearance of the application. In addition, users will no longer be required to configure browser settings to Internet Explorer 8 to receive exception messages. Google Chrome also will be compatible with this enhancement. Additional Fannie Mae technology requirements can be found here.

Go ahead, Ask Poli!

Check out Ask Poli, a new tool that uses natural language processing to quickly find answers to your Fannie Mae policy questions. Sellers and servicers can give Ask Poli a spin at AskPoli.fanniemae.com or on the Selling and Servicing Guide pages.

Reminder: Imminent Default Evaluations change effective July 1

On Oct. 11, 2017, Lender Letter LL-2017-08 announced new policies for Imminent Default Evaluations for Conventional Mortgage Loan Modifications to replace the Freddie Mac Imminent Default Indicator. Servicers must begin evaluating borrowers for imminent default for a conventional mortgage loan modification according to the new requirements no later than July 1. After that date, servicers will no longer be able to evaluate borrowers using Freddie Mac’s IDI.

More time for fireworks: No Servicing News on July 4

Servicing News will be taking a holiday next week. We wish everyone a happy Independence Day and we’ll see you back here on July 11.

Join us at these upcoming events:

June 28-29 | 2018 Annual State Conference MBA of Hawaii | Honolulu
July 16-18 | California’s MBA’s 46th Annual Western Secondary Market Conference | San Francisco
July 29-31 | CoreLogic EPIQ | Dana Point, CA

View more events.

Recent Tweets

What a difference a year makes: Cost cutting jumps from 2nd least-important priority for lenders to 3rd most-important. New analysis:
http://bit.ly/2IvkCdA #MLSS

June 26

Out of the hundreds of proposals we received from across the U.S. for the #FannieMaeChallenge, the ideas presented by @FLHousingC, @nationwidekids, and West Denver Renaissance Collaborative, reflect the most innovative thinking.
http://bit.ly/2KfoLbG #InnovateHousing

June 26

Fannie Mae: Ask Poli Is Here to Help; Imminent Default Policy Going Into Effect Next Month

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
June 20, 2018

Source: Fannie Mae

Go ahead, Ask Poli a Fannie Mae policy question!

We recently launched Ask Poli, a new tool that uses natural language processing to better understand your policy questions and quickly find the answers you’re seeking. Available to Fannie Mae sellers and servicers, Ask Poli not only provides answers, but it tells you where to find relevant details in the Selling and Servicing Guides, and allows you to share or print the answers to keep for your files. Give Ask Poli a spin at AskPoli.fanniemae.com or on the Selling and Servicing Guide pages.

Reminder: Imminent Default Evaluations change effective July 1

Join us at these upcoming events:

View more events.

Recent Tweets

@Computerworld’s listed us as a top-100 Best Place to Work in IT! Our developers, coders, engineers, and other tech team members are transforming the housing market. #InnovateHousing #HeartofHousing
http://bit.ly/2I5B8ks

June 20

#ICYMI: Q2 Mortgage Lender Sentiment Survey shows lenders are bearish about growth, mortgage demand. #MLSS
https://t.co/7cEiN0O1ON

June 19

Fannie Mae: Foreclosure-Related Title Cost Updates and More

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
June 6, 2018

Source: Fannie Mae

Foreclosure-related title cost updates coming soon

Our new foreclosure-related title cost guidance will go into effect for all servicers for referrals on or after Sept. 1. The changes will update the maximum allowable foreclosure title costs, clarify what must be included in foreclosure title searches, and provide a new optional foreclosure title vendor list for law firms. Updated documents can be found on the Delinquency and Default Management page.

We will also update our AAA matrices in the coming weeks to reflect these changes. If a Mortgage Default Counsel (MDC) law firm chooses to use a Fannie Mae optional title vendor, Fannie Mae will not hold the servicer or law firm responsible if the vendor makes an error in its title search that directly results in failure to deliver a clear title after foreclosure or causes delays that exceed Fannie Mae’s allowable foreclosure time frame. Remember: Servicers must allow the MDC law firm to select a title vendor of its choice and may not directly or indirectly require or encourage the law firm to use a specific vendor.

Updated Maine AAA matrix

We have revised the Maine AAA matrix to include new Plaintiff’s Discovery fees for foreclosure referrals effective on or after June 1. Excess fees are permitted for preparation of the Request for Admissions ($150) and for taking the borrower’s deposition ($500). To view the updated matrix, visit the Excess Attorney Fee/Cost Guidelines page.

Join us at these upcoming events:

June 19-22 | NAFCU Annual Conference and Solutions Expo | Seattle
June 20-21 | MBA of Florida 65th Annual Convention | St. Petersburg
June 21-22 | NEXT Women’s Mortgage Conference | Dallas

View more events.

Recent Tweets

State laws? Local ordinances? What have other communities done that can help solve the housing crisis in your area? @JenRobertsNC can tell you what worked for Charlotte.
http://bit.ly/2sLBkQ3

June 6

Learn how the HomeReady 3% down payment #mortgage can help qualified low- to moderate income borrowers purchase or refinance a home.
http://bit.ly/2HjWqKF

June 5

VA: Circular 26-18-9: Special Relief Following North Carolina Tornado and Severe Storms

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
May 14, 2018

Source: VA

1. Purpose. This Circular expresses concern about the Department of Veterans Affairs (VA) home loan borrowers affected by the tornado and severe storms in the State of North Carolina and describes measures mortgagees may employ to provide relief. Mortgage servicers and borrowers alike should review VA’s Guidance on Natural Disasters to ensure Veterans receive the assistance they need. (https://www.benefits.va.gov/homeloans/documents/docs/va_policy_regarding_natural_disasters. pdf)

2. Forbearance Request. VA encourages holders of guaranteed loans to extend forbearance to borrowers in distress as a result of the tornado and storms. Careful counseling with borrowers should help determine whether their difficulties are related to this disaster, or whether they stem from other sources that must be addressed. The proper use of authorities granted in VA regulations may be of assistance in appropriate cases. For example, Title 38, Code of Federal Regulations (CFR), section 36.4311 allows the reapplication of prepayments to cure or prevent a default. Also, 38 C.F.R. 36.4315 allows the terms of any guaranteed loan to be modified without the prior approval of VA, provided conditions in the regulation are satisfied.

3. Moratorium on Foreclosure. Although the loan holder is ultimately responsible for determining when to initiate foreclosure, and for completing termination action, VA has requested on its website (https://www.benefits.va.gov/homeloans) that holders establish a 90day moratorium from the date of a disaster on initiating new foreclosures on loans affected by major disasters. VA regulation 38 C.F.R. 36.4324(a)(3)(ii) allows additional interest on a guaranty claim when eventual termination has been delayed due to circumstances beyond the control of the holder, such as VA-requested forbearance. Due to the widespread impact of the tornado and storms, holders should review all foreclosure referrals to ensure that borrowers have not been affected significantly enough to justify delay in referral. Any questions about impact should be discussed with the VA Regional Loan Center (RLC) of jurisdiction.

4. Late Charge Waivers. VA believes that many servicers plan to waive late charges on affected loans, and encourages all servicers to adopt such a policy for any loans that may have been affected.

5. Credit and VA Reporting. In order to avoid damaging credit records of Veteran borrowers, servicers are encouraged to suspend credit bureau reporting on affected loans. VA will not penalize affected servicers for any late default reporting to VA as a result. Please contact the appropriate RLC with any questions.

6. Activation of the National Guard. Members of the National Guard may be called to active duty to assist in recovery efforts. VA encourages servicers to extend special forbearance to National Guard members who experience financial difficulties as a result of their service.

7. Rescission: This Circular is rescinded May 1, 2019.

By Direction of the Under Secretary for Benefits

Jeffrey F. London

Director, Loan Guaranty Service

VA: Circular 26-18-8: Special Relief Following Hawaii Severe Storms, Flooding, Landslides and Mudslides

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
May 14, 2018

Source: VA

1. Purpose. This Circular expresses concern about the Department of Veterans Affairs (VA) home loan borrowers affected by severe storms, flooding, landslides and mudslides in the State of Hawaii and describes measures mortgagees may employ to provide relief. Mortgage servicers and borrowers alike should review VA’s Guidance on Natural Disasters to ensure Veterans receive the assistance they need. (https://www.benefits.va.gov/homeloans/documents/docs/va_policy_regarding_natural_disasters. pdf)

2. Forbearance Request. VA encourages holders of guaranteed loans to extend forbearance to borrowers in distress as a result of the storms, flooding, landslides and mudslides. Careful counseling with borrowers should help determine whether their difficulties are related to this disaster, or whether they stem from other sources that must be addressed. The proper use of authorities granted in VA regulations may be of assistance in appropriate cases. For example, Title 38, Code of Federal Regulations (C.F.R.), section 36.4311 allows the reapplication of prepayments to cure or prevent a default. Also, 38 C.F.R. 36.4315 allows the terms of any guaranteed loan to be modified without the prior approval of VA, provided conditions in the regulation are satisfied.

3. Moratorium on Foreclosure. Although the loan holder is ultimately responsible for determining when to initiate foreclosure, and for completing termination action, VA has requested on its website (https://www.benefits.va.gov/homeloans) that holders establish a 90day moratorium from the date of a disaster on initiating new foreclosures on loans affected by major disasters. VA regulation 38 C.F.R. 36.4324(a)(3)(ii) allows additional interest on a guaranty claim when eventual termination has been delayed due to circumstances beyond the control of the holder, such as VA-requested forbearance. Due to the widespread impact of the storms, flooding, landslides and mudslides, holders should review all foreclosure referrals to ensure that borrowers have not been affected significantly enough to justify delay in referral. Any questions about impact should be discussed with the VA Regional Loan Center (RLC) of jurisdiction.

4. Late Charge Waivers. VA believes that many servicers plan to waive late charges on affected loans, and encourages all servicers to adopt such a policy for any loans that may have been affected.

7. Rescission: This Circular is rescinded May 1, 2019.

By Direction of the Under Secretary for Benefits

Jeffrey F. London

Director, Loan Guaranty Service

VA: Circular 26-18-13: Policy Guidance Update: VA Refinance Loans and the Economic Growth, Regulatory Relief and Consumer Protection Act

Posted on September 13, 2018September 13, 2018 by Safeguard

Investor Update
May 25, 2018

Source: VA

1. Purpose. To inform program participants about the impact of the provisions of The Protecting Veterans From Predatory Lending Act of 2018, as it relates to Veterans Affairs (VA) home loan financing. Program participants must be aware of important program changes that go into effect immediately.

2. Background. The Senate passed S. 2155, The Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018 on March 14, 2018, and the House voted in favor of S. 2155 on May 22, 2018. The bill has been signed by the President and is now law. S. 2155 includes The Protecting Veterans From Predatory Lending Act of 2018 (the Act), a measure designed to protect Veterans from predatory lending practices known as “loan churning” or “serial refinancing”, when obtaining a VA-guaranteed refinance loan. These practices not only impact Veterans negatively, but also disrupt the secondary mortgage market, resulting in higher interest rates to Veterans and lower returns to investors in the secondary market.

3. Action. VA-guaranteed loans must meet the requirements of the new law. Loan applications taken on or after May 25, 2018 that do not meet the following requirements will not be eligible for guaranty by VA.

a. Fee Recoupment. The lender, which also includes any broker or agent of the lender, and any servicer or issuer of an Interest Rate Reduction Refinance Loan (IRRRL), must:

(1) Provide recoupment statements to VA in accordance with VA Circular 26-18-1 and 26-18-1 Change 1, Policy Guidance for VA Interest Rate Reduction Refinance Loans (IRRRL), and;

(2) Certify that all fees and incurred costs, referenced in VA Circular 26-18-1, shall be recouped on or before the date that is 36 months after the date of the loan, as determined by the date of the loan note. The recoupment calculation is described in the aforementioned Circular, and is the result of lower monthly payments of the refinanced loan.

b. Net Tangible Benefit. The lender, which also includes any broker or agent of the lender, and any servicer or issuer of an IRRRL, must provide the Veteran or borrower a net tangible benefit test (NTB) as follows:

(1) A case in which the previous VA loan had a fixed interest rate and the new refinanced loan will have a fixed interest rate; the new refinanced loan must have an interest rate that is not less than 50 basis points (.50 less in interest rate) less than the previous loan.

(2) A case in which the previous VA loan had a fixed interest rate and the new refinanced loan will have an adjustable interest rate, the new refinanced loan must have an interest rate that is not less than 200 basis points (2.00 less in interest rate) less than the previous loan, and

(3) The lower interest rate is not produced solely from discount points unless;

(a) Such points are paid at closing; and

(b) For discount point amounts that are less than or equal to one discount point, the resulting loan balance after any fees and expenses allows the property with respect to which the loan was issued to maintain a loan-to-value (see exhibit A, attached) ratio of 100 percent or less; and

(c) For discount point amounts that are greater than one discount point, the resulting loan balance after any fees and expenses allows the property with respect to which the loan was issued to maintain a loan-to-value (see exhibit A, attached) ratio of 90 percent or less.

4. Loan Seasoning. All VA-guaranteed loans must be seasoned for a period of time, before refinancing to an IRRRL, also known as a VA streamline refinance. The seasoning period also applies to cash-out refinances when the principal amount of the new loan is less than the loan being refinanced. (Seasoning shall not apply to a VA cash-out or “regular” refinance if the principal amount of the new cash-out loan will exceed the amount of the loan being refinanced.) The required seasoning is the later of;

(a) The date that is 210 days after the date on which the first payment is made on the loan, and;

(b) The date on which the sixth monthly payment is made on the loan.

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

By Direction of the Under Secretary for Benefits

Jeffrey F. London
Director
Loan Guaranty Service