Safeguard Properties

CFPB Asked to Repeal Mortgage Servicing Amendments

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Investor Update
February 13, 2018

A group of a half dozen trade associations recently sent a letter to Mick Mulvaney, Acting Director of the Consumer Financial Protection Bureau. The letter raises objections over 2016 amendments to the CFPB’s  2013 RESPA and TILA Mortgage Servicer Rule, which are scheduled to go into effect in April 2018. The trade associations present an argument that these amendments, if implemented, could lead to borrower confusion and lead to numerous other administrative and legal hassles during the mortgage servicing process.

The amended CFPB rule would require mortgage servicers “to send monthly billing statements to consumers in active bankruptcy cases and certain bankruptcy cases in which the debtor’s personal liability was previously discharged.” The trade groups claim that this requirement would conflict with “well-settled bankruptcy law prohibiting a creditor from collecting from consumers who are in an active bankruptcy case or who have previously been discharged from personal liability in a prior bankruptcy case.”

According to the letter, “the CFPB’s final rule is contrary to this strong public policy of protecting bankruptcy debtors, will cause conflict within the administration of the bankruptcy case, and will unnecessarily subject servicers to serious liability under the Bankruptcy Code.” The letter goes on to argue that the CFPB’s final rule “presents significant risk of diluting the Judiciary’s efforts in effectively administering its bankruptcy cases and usurps the Judiciary’s rulemaking power in deciding what information should and should not be provided to a debtor during a bankruptcy proceeding.”

If the CFPB declines to repeal its amended rule, the letter asks that the bureau to revisit specific portions of the rule, including “the past-payment breakdown, servicer transfers, and pre-confirmation cases, among others.”

Signatories on the letter included the National Association of Federally-Insured Credit Unions, American Financial Services Association, Consumer Mortgage Coalition, CUNA, HOPE NOW Alliance, Independent Community Bankers of America, and the Real Estate Settlement Providers Council. You can read the letter in full by clicking here.

Although the CFPB won a legal victory in late January, after the Court of Appeals for the District of Columbia Circuit ruled that the CFPB’s structure is constitutional, the bureau is nevertheless undergoing a sea change of focus and intent under Acting Director Mick Mulvaney. Earlier this week, the CFPB and Mulvaney unveiled a new strategic plan for the bureau, vowing to meet the organization’s statutory responsibilities but go “no further,” adding that “pushing the envelope in pursuit of other objectives ignores the will of the American people” and “also risks trampling upon the liberties of our citizens.”

This backing away from the CFPB’s focus on enforcement is consistent with Mulvaney’s past criticisms of the bureau as being too independent and overpowered. In November, shortly after taking the reins of the CFPB, Mulvaney instituted a 30-day hiring and regulatory freeze.

Source: DS News

CFPB Acting Director Announces Chief of Staff

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Investor Update
February 6, 2018

Washington, D.C. — The Consumer Financial Protection Bureau’s Acting Director Mick Mulvaney announced today that he has named Kirsten Sutton Mork chief of staff for the agency. Ms. Sutton Mork has been serving as staff director of the House Financial Services Committee under Chairman Jeb Hensarling.

“I am pleased to announce Ms. Sutton Mork as the new chief of staff at the Bureau of Consumer Financial Protection,” said CFPB Acting Director Mick Mulvaney. “I worked with Kirsten during my tenure as a member on the House Financial Services Committee and can attest to her in-depth financial policy expertise, proven track record of developing and implementing strategic initiatives, and ability to manage a team. Kirsten brings with her more than a decade of invaluable experience that will advance the mission of the Bureau and make it more efficient, effective, and accountable.”

Ms. Sutton Mork’s tenure on Capitol Hill spans the financial crisis and post-crisis legislative response. She staffed Hensarling during House Financial Services Committee, House and conference committee consideration of the legislation that established the Bureau, the Dodd-Frank Act, and she is intimately familiar with the Bureau’s statutory mission and obligations. She was appointed deputy staff director to the House Financial Services Committee in 2013 and became staff director in early 2017. Ms. Sutton Mork attended Wheaton College where she received a B.A. in communications.

Source: CFPB

VALERI Servicer Newsflash

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Investor Update
January 12, 2017

IMPORTANT INFORMATION

Appraisal Fee Changes – Effective Thursday, February 1, 2018, liquidation appraisal fees will increase in Arkansas, Louisiana, Oklahoma, and Texas. The changes will be updated and reflected on the VALERI Fee Cost Schedule, which is located at http://www.benefits.va.gov/HOMELOANS/servicers_valeri_rules.asp.

DEVELOPMENT UPDATES

On Sunday, January 14, 2018, VALERI Manifest 17.4 BI will be released. The following report enhancements will be included:

CQ 13109 – Adds supplemental claims and negative claims to the Claim Detail Results report.

CQ 13113 – Adds supplemental claims and negative claims to the Claim Summary report.

CQ 13116 – Adds supplemental claim and negative claim payments to the Payment Denial report.

Source: VA

MHA HAMP Update: Upcoming HAMP Reporting Tool User Interface Outage

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Investor Update
January 29, 2018

Black Knight will be conducting maintenance activities during the weekend of February 17, 2018. All Black Knight applications including the HAMP Reporting Tool user interface will be unavailable from Saturday, February 17, 2018, 9:00 a.m. ET – Sunday, February 18, 12:00 a.m. ET (Midnight).

If users attempt to access the Black Knight application during this time, they will receive connection errors. If you have questions, call 1-866-939-4469; to reach Black Knight Financial Services (BKFS), select option 1, then option 5.

Source: MHA

MHA HAMP Update: Martin Luther King, Jr. Day Holiday Support and System Availability

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Investor Update
January 8, 2018

Due to the observance of Martin Luther King, Jr. Day, the HAMP Reporting System response files will not be available between 6:00 p.m. ET on Friday, January 12, 2018 and 8:00 a.m. ET on Tuesday, January 16, 2018; they will be sent as soon as the system is available.

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 (HSC) will be closed on Monday, January 15, 2018 and will resume operations at 9:00 a.m. ET on Tuesday, January 16, 2018. Servicers may contact the HSC at any time; however, messages will be held in queue until the center reopens on Tuesday.

The NPV Transaction Portal will be available for normal processing during this period.

Questions?
For more information, email the HAMP Solution Center or call 1-866-939-4469.

Source: MHA

HUD FHA INFO #18-01: FHA Disaster-Related Policy Waiver for Four Additional Counties in Presidentially-Declared Major Disaster Areas in California

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Investor Update
January 18, 2018

Today, the Federal Housing Administration (FHA) issued a waiver for four additional counties — Los Angeles, San Diego, Santa Barbara, and Ventura — in California impacted by wildfires, allowing damage inspections to be conducted beginning January 18, 2018. This waiver is in addition to the two previous waivers issued by FHA on October 24, 2017, and November 2, 2017, respectively, of its policy on the timeframe for completing the inspection of properties prior to closing, or submitting the mortgage for FHA insurance endorsement in the Presidentially-Declared Major Disaster Areas (PDMDAs) in certain counties in the state of California impacted by wildfires.

  • For mortgages in process secured by properties in a PDMDA that have not closed or are pending endorsement, mortgagees must follow the guidance contained in the Single Family Housing Policy Handbook 4000.1 (SF Handbook) Section II.A.7.c, Inspection and Repair Escrow Requirements for Mortgages Pending Closing or Endorsement in Presidentially-Declared Major Disaster Areas. FHA’s current policy requires that a damage inspection be performed following the close of the Incident Period as defined by the Federal Emergency Management Agency (FEMA).
  • FHA believes that the situations in certain counties in California have stabilized to the extent that further damage to the properties appear unlikely, despite FEMA not having closed its Incident Period for the PDMDAs in these four areas. However, mortgagees should continue to monitor FEMA’s website to ascertain the latest information on these PDMDAs as additional municipalities or counties could be added to them until the Incident Periods have closed.
    These waivers do not affect mortgagees’ obligations to exercise prudent lending practices and ensure that mortgages they submit for endorsement fully comply with FHA’s property eligibility requirements, as well as any property condition requirements related to claims processing.
    — The California “Wildfires” waivers are posted at: https://www.hud.gov/sites/dfiles/OCHCO/documents/sf_hb40001waiverCA2.pdf

Mortgagees can find more information about FHA’s PDMDA policies, as well as the 203(h) Mortgage Insurance for Disaster Victims Program and the 203(k) Rehabilitation Mortgage Insurance Program, on the FHA Resource Center’s Online Knowledge Base.

Quick Links

Resources
Contact the FHA Resource Center:

  • Visit our online knowledge base to obtain answers to frequently asked questions 24/7 at:
    https://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-CALL-FHA (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.

Source: HUD (FHA INFO #18-01 full version)

HUD: Change to Debenture Interest Rates

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Investor Update
January 24, 2018

AGENCY:

Office of the Assistant Secretary for Housing, HUD.

ACTION:

Notice.

SUMMARY:

This Notice announces changes in the interest rates to be paid on debentures issued with respect to a loan or mortgage insured by the Federal Housing Administration under the provisions of the National Housing Act (the Act). The interest rate for debentures issued under Section 221(g)(4) of the Act during the 6-month period beginning January 1, 2018, is 2 3/8 percent. The interest rate for debentures issued under any other provision of the Act is the rate in effect on the date that the commitment to insure the loan or mortgage was issued, or the date that the loan or mortgage was endorsed (or initially endorsed if there are two or more endorsements) for insurance, whichever rate is higher. The interest rate for debentures issued under these other provisions with respect to a loan or mortgage committed or endorsed during the 6-month period beginning January 1, 2018, is 23/4 percent.

Source: HUD/Office of the Federal Register (full notice)

HUD: Carson Delivers Oath of Office to Four New HUD Leaders

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Investor Update
January 12, 2018

Compton, Tufts, Wolfson and Dennis sworn in to help lead Department during critical time

WASHINGTON – The U.S. Department of Housing and Urban Development (HUD) has four new top leaders who are assuming key roles in the agency at the start of a new year and during a critical recovery period following last year’s devastating hurricanes. HUD Secretary Ben Carson administered the oath of office to the following individuals recently confirmed by the U.S. Senate: J. Paul Compton, Jr. to become HUD’s General Counsel; Suzanne Israel Tufts to be Assistant Secretary for the Office of Administration; Leonard Wolfson as Assistant Secretary for Congressional and Intergovernmental Relations; and Irving Dennis to serve as Chief Financial Officer.

“Today, our bench got a lot deeper,” said Secretary Carson. “These four outstanding individuals bring substantial experience to HUD at a moment when our Department is being called upon to excel as we support millions of our fellow citizens recovering from Hurricanes Harvey, Irma and Maria.”

J. Paul Compton, Jr. will lead HUD’s Office of General Counsel which provides advice and services to all HUD programs and activities. OGC represents the department in litigation and enforcement actions; provides legal services in the development, preparation and presentation of the Department’s legislative initiatives; has primary responsibility for the development of HUD program regulations; represents the department in multifamily finance transactions; and assists in the development of HUD programs and policies. General Counsel Compton is an Alabama native with legal expertise in the areas of multifamily affordable housing finance, tax credit transactions and mortgage securitization. A former partner of the Birmingham-based law firm of Bradley Arant Boult Cummings LLP, Compton is listed by Chambers USA as one of America’s leading business lawyers on issues related to banking, finance and regulatory matters. He also served as a legal advisor to the Alabama Affordable Housing Association, a trade organization for developers, property managers, lenders, investors and service providers for affordable housing. He is a Truman Scholar and a graduation of the University of Virginia School of Law.

Assistant Secretary Suzanne Israel Tufts will lead HUD’s Office of Administration tasked with delivering administrative support and customer service to HUD employees nationwide. As HUD’s chief administrative officer, Ms. Tufts will oversee the Department’s human resources, contract procurement and training needs. A New York-based attorney with extensive experience in turnaround management, Assistant Secretary Tufts served in operational roles in the public and not-for-profit sectors, including public housing authorities in New York State. Ms. Tufts is a nationally recognized expert in the field of social programming in inner cities including microenterprises, education and women’s issues. She formerly served as President and Chief Executive Officer of the American Woman’s Economic Development Corporation (AWED), the nation’s first women’s entrepreneurship training center. Following the terror attacks of September 11, 2001, Assistant Secretary Tuffs and AWED launched emergency small business crisis services for which she was recognized by President George W. Bush and then- Secretary of Labor Elaine Chao. Ms. Tufts graduated summa cum laude with an A.B. in Bio-Medical Ethics from Princeton University in 1977, and graduated from the University of Virginia Law School where she was awarded a Dillard Fellowship.

As HUD’s Assistant Secretary of Congressional and Intergovernmental Relations, Len Wolfson will serve as the principal advisor to the Secretary, Deputy Secretary and senior staff on legislative affairs, Congressional relations, and policy matters affecting Federal, state and local governments, as well as public and private stakeholders. Prior to his service at HUD, Assistant Secretary Wolfson served as Associate Vice President of Legislative Affairs for the Mortgage Bankers Association, where he helped the real estate finance industry recover from the financial crisis by advocating for a return to safe and sustainable lending. He previously served as HUD’s General Deputy Assistant Secretary for Congressional and Intergovernmental Relation, during the George W. Bush administration. During that time, he led HUD’s successful legislative efforts to modernize the Federal Housing Administration (FHA) as part of the Housing and Economic Recovery Act of 2008. A Connecticut native, Mr. Wolfson also served his hometown congressional representative, Christopher Shays. He earned a B.A. in history and political science from the University of Connecticut.

Irv Dennis is HUD’s Chief Financial Officer responsible for employing sound financial management practices across all of the agency’s program areas. Mr. Dennis will oversee the accounting, budget and financial management for the agency’s budget and appropriations including processing millions of transactions each year to support HUD’s mission. Prior to his public service, Mr. Dennis was a Global Client Service Partner with Ernst & Young, LLP where he worked with several large multinational public companies in various industries. Mr. Dennis earned a B.S. Degree in business administration-accounting from Montclair State University and is a Certified Public Accountant. He serves on several not-for-profit boards and has been a member of various accounting-related organizations.

Source: HUD

Freddie Mac: Register Now to Test Our Investor Reporting Changes

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Investor Update
January 9, 2018

We continue to make progress on the Investor Reporting Change Initiative, and we’ll soon be entering the testing phase of the project. Register today to test our investor reporting changes.

Why Test with Us?

These changes affect all Freddie Mac Seller/Servicers, regardless of whether you use a vendor, proprietary systems or the Freddie Mac Service Loans application. By participating, you’ll be able to:

  • Validate your systems are ready for investor reporting changes.
  • Confirm your systems and processes will work during the cutover transition.
  • Test your business processes for investor reporting modifications.

Servicers: You’re strongly encouraged to test with us. If you use vendors or Sub-Servicers we suggest reviewing the Freddie Mac recommended customer integration testing scenarios that apply to your portfolio with your vendor/Sub-Servicer. Each Sub-Servicer/vendor may submit loan numbers to Freddie Mac for testing up to 10% of the Servicer’s portfolio volume.

Please confirm your participation by February 16 by opting in below, and include names/email addresses of additional colleagues within your organization who would like to participate.
 
YES, Please Invite Me
 
For More Information

Source: Freddie Mac

Freddie Mac: Flood Insurance Requirements Remain Unchanged Despite a Lapse in the National Flood Insurance Program

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Investor Update
January 22, 2018

The National Flood Insurance Program’s (NFIP) authority to issue new and renewal policies and increase coverage on existing policies expired on January 20, 2018.  Our policies on flood insurance remain unchanged.

During this lapse in the NFIP’s authority, Freddie Mac’s policies on flood insurance in Chapters 3401 and 8202 of the Single-Family Seller/Servicer Guide (Guide) remain unchanged, including:

  • Seller/Servicers originating mortgages for sale to Freddie Mac must continue to perform flood zone determinations.
  • Properties located in Special Flood Hazard Areas securing mortgages owned by and delivered to Freddie Mac must have flood insurance coverage.
  • For Servicers, payments to renew expiring policies must be made as scheduled.

If a borrower applies for NFIP flood insurance, acceptable evidence pending issuance of a final NFIP policy may include one of the following:

  • A completed and executed NFIP Flood Insurance Application plus a copy of the borrower’s premium check or agent’s paid receipt;
  • A completed and executed NFIP Flood Insurance Application plus the final Settlement/Closing Disclosure Statement reflecting the flood insurance premium collected at closing;
  • A completed and executed NFIP General Change Endorsement Form showing the assignment of the current flood insurance policy by the property seller to the borrower

Seller/Servicers that accept interim evidence of NFIP coverage as described above during the lapse in the NFIP’s authority must follow up once the NFIP’s authority has been reinstated, to ensure that they have final evidence of coverage meeting the requirements of Guide Section 8202.7.

If a borrower applies for private flood insurance, the insurer’s binder or equivalent of the applicable NFIP form is acceptable. Private flood insurance is not affected by a lapse in the NFIP’s authority.

Source: Freddie Mac