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FHLMC Guide Bulletin 2017-14: Temporary Servicing Requirements Related to Borrowers Affected by Hurricane Harvey

Posted on September 13, 2018 by Safeguard

Investor Update
August 29, 2017

PLEASE NOTE: The section referring to property inspections has been included below and can be located within Servicing Guide Bulletin 2017-14:

PROPERTY INSPECTIONS FOR PROPERTIES LOCATED IN AN ELIGIBLE DISASTER AREA AS A RESULT OF HURRICANE HARVEY
Freddie Mac is aware that Servicers may need to conduct a property inspection of the Mortgaged Premises in an Eligible Disaster Area to determine the impacts of the damage. The inspection may not normally be reimbursable by Freddie Mac in accordance with Sections 9202.12 and 9701.9. We will create a process for Servicers to seek reimbursement for the related inspection costs, which will be announced in a future communication.

Freddie Mac is committed to helping borrowers receive the mortgage assistance they need to mitigate the devastating impacts of Hurricane Harvey. We provide you with options to assist borrowers whose homes or places of employment are located within Eligible Disaster Areas and appreciate your help during this difficult time.

Single-Family Seller/Servicer Guide (Guide) Bulletin 2017-14

To ensure that borrowers continue to receive the assistance they need, we’re announcing a temporary suspension of foreclosures and evictions. Additionally, Freddie Mac will work with you so that property inspection costs resulting directly from Hurricane Harvey will not be passed on to the affected borrowers.

All changes announced in this Guide Bulletin are effective immediately.

Please read Guide Bulletin 2017-14 [pdf] for specific requirements.

Next Steps for Servicers

All Freddie Mac Servicers should respond to borrower requests for assistance using the options available to you through our Guide Bulletin. Other than the temporary measures being announced, all other disaster relief requirements and options have not changed.

You should immediately begin following the disaster relief requirements outlined in Guide Chapter 8404, which include:

Obtaining quality right party contact as soon as possible.
Short-term suspension of collection and foreclosure proceedings for up to 12 months from the date a disaster strikes to address each borrower’s specific financial hardship and circumstances.
No assessment of late charges or reporting to credit repositories for borrowers on a forbearance plan or paying as agreed on a repayment plan.
Help with options for local, state, or federal disaster assistance.
Monitoring and coordinating the insurance claim process.

If you need to respond to assistance requests from impacted borrowers:

Refer to the general mortgage relief policies in Guide Chapter 8404.
Determine the number of impacted properties and assess the extent of the damage caused by the major disaster.
Consider borrowers who work in eligible disaster areas but have homes in unaffected areas for Freddie Mac’s disaster relief policies, which include forbearance or mortgage modifications.

Special Relief Consideration

If you’re faced with a unique situation that may warrant special relief consideration, we’ll review individual circumstances on a case-by-case basis.

For More Information

Read Freddie Mac’s latest Hurricane Harvey press release.
Freddie’s Mac’s Disaster Policies web page.
Contact your Freddie Mac representative.

Source: Freddie Mac

Additional Resource:

Safeguard Properties (Hurricane Harvey All Client Alert summary page)

FHFA Results of Fannie Mae and Freddie Mac Dodd-Frank Act Stress Tests

Posted on September 13, 2018 by Safeguard

Investor Update
August 7, 2017

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today released a report providing the results of the annual stress tests Fannie Mae and Freddie Mac (the Enterprises) are required to conduct under the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The Dodd-Frank Act requires certain financial institutions with more than $10 billion in assets to conduct annual stress tests to determine whether they can absorb losses as a result of adverse or severely adverse economic conditions.

The report, Dodd-Frank Act Stress Tests – Severely Adverse Scenario, provides updated information on possible ranges of future financial results of the Enterprises under severely adverse economic conditions.

Link to Dodd-Frank Act Stress Tests – Severely Adverse Scenario

Link to 2017 Summary Instructions and Guidance

Link to DFAST Frequently Asked Questions (FAQs)

The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. These government-sponsored enterprises provide more than $5.9 trillion in funding for the U.S. mortgage markets and financial institutions. Additional information is available at www.FHFA.gov, on Twitter @FHFA, YouTube and LinkedIn.

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

Consumers: Consumer Communications or (202) 649-3811

Source: FHFA

FHFA: Refinance Report – Second Quarter 2017

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

Investor Update
August 17, 2017

Second Quarter 2017 Highlights

Total refinance volume increased in June 2017 as mortgage rates fell in May. Mortgage rates continued to decrease in June: the average interest rate on a 30-year fixed rate mortgage fell to 3.90 percent from 4.01 percent in May.

In the second quarter of 2017:

Borrowers completed 9,707 refinances through HARP, bringing total refinances from the inception of the program to 3,470,804.
HARP volume represented 3 percent of total refinance volume.

Year to date through June 2017:

Borrowers with loan-to-value ratios greater than 105 percent accounted for 19 percent of the volume of HARP loans.
Twenty-five percent of HARP refinances for underwater borrowers were for shorter-term 15- and 20-year mortgages, which build equity faster than traditional 30-year mortgages.
HARP refinances represented 6 or more percent of total refinances in Nevada, and Florida, double the 3 percent of total refinances nationwide over the same period.
In June 2017, 6 percent of the loans refinanced through HARP had a loan-to-value ratio greater than 125 percent.
Borrowers who refinanced through HARP had a lower delinquency rate compared to borrowers eligible for HARP who did not refinance through the program.
Nine states and one U.S. territory accounted for over 60 percent of the Nation’s HARP eligible loans with a refinance incentive as of March 31, 2017.

Related News Release

Attachments:

Refinance Report – Second Quarter 2017

source: FHFA

FHFA: Foreclosure Prevention Report – May 2017

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

Investor Update
August 8, 2017

MAY 2017 HIGHLIGHTS

The Enterprises’ Foreclosure Prevention Actions:

The Enterprises completed 15,683 foreclosure prevention actions in May, bringing the total to 3,914,668 since the start of the conservatorships in September 2008. Over half of these actions have been permanent loan modifications.
There were 10,769 permanent loan modifications in May, bringing the total to 2,076,345 since the conservatorships began in September 2008.
The share of modifications with principal forbearance accounted for 25 percent of all permanent modifications in May. Modifications with extend-term only increased to 45 percent due to continuing improvement in house prices.
There were 1,489 short sales and deeds-in-lieu completed in May, down 10 percent compared with April.

The Enterprises’ Mortgage Performance:

The serious delinquency rate fell further from 1.01 percent at the end of April to 0.98 percent at the end of May.

The Enterprises’ Foreclosures:

Third-party and foreclosure sales increased 9 percent from 5,523 in April to 6,042 in May.
Foreclosure starts decreased 13 percent from 17,056 in April to 14,905 in May.

Attachments: Foreclosure Prevention Report – May 2017

Source: FHFA

FHFA: Modifications to High LTV Streamlined Refinance Program and Extension of HARP Through December 2018

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

Investor Update
August 17, 2017

Washington, D.C. – The Federal Housing Finance Agency (FHFA) today announced modifications to the streamlined refinance program for borrowers with high loan-to-value (LTV) ratios. On August 25, 2016, FHFA announced that Fannie Mae and Freddie Mac (the Enterprises) would implement a High LTV Streamlined Refinance program to provide much-needed liquidity for borrowers who are current on their mortgage but are unable to refinance because their loans have LTV ratios that exceed the Enterprises’ maximum limits.

The program announced today establishes an eligibility date which makes the program available for loans originated on or after October 1, 2017. The eligibility date was necessary to preserve the objectives of the Enterprises’ credit risk transfer (CRT) program under which the Enterprises have transferred a portion of risk on $1.6 trillion of unpaid principal balance with a combined risk in force of nearly $54.2 billion as of March 2017. The Enterprises will modify the structure of future CRT transactions to accommodate the High LTV Streamlined Refinance program by allowing the newly refinanced loans to return to the reference pools in place of loans that prepaid. This will help preserve credit loss protection on the loans without unwinding the protection paid for through CRT transactions.

The changes made to the High LTV Streamlined Refinance program appropriately balance continuing to offer assistance to underwater borrowers with protecting taxpayers.

HARP Extended Through 2018
To ensure that high LTV borrowers who are eligible for HARP continue to have a refinance option, FHFA is also directing the Enterprises to extend HARP through December 31, 2018. HARP continues to be one of the most successful crisis-era programs through which more than 3.4 million homeowners have refinanced their mortgages. More than 143,000 homeowners could still benefit from refinancing through HARP. Visit HARP.gov and follow @FHFA on Twitter, LinkedIn and YouTube for more information.

For further details on the High LTV Streamlined Refinance program, view the following fact sheets:

Fannie Mae Fact Sheet

Freddie Mac Fact Sheet

The Federal Housing Finance Agency regulates Fannie Mae, Freddie Mac and the 11 Federal Home Loan Banks. These government-sponsored enterprises provide more than $5.9 trillion in funding for the U.S. mortgage markets and financial institutions. Additional information is available at www.FHFA.gov, on Twitter @FHFA, YouTube and LinkedIn.

Contacts:

Media: Stefanie Johnson (202) 649-3030 / Corinne Russell (202) 649-3032
Consumers: Consumer Communications or (202) 649-3811

Source: FHFA

FHA INFO #17-33: Home Equity Conversion Mortgage Servicing Implementation Guidance Issued Today

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

Investor Update
August 24, 2017

Today, the Federal Housing Administration (FHA) published Mortgagee Letter 2017-11, Implementation of HUD’s January 2017 Home Equity Conversion Mortgage (HECM) Final Rule, which serves as a consolidated directive for those mortgagees required to implement certain servicing policy changes contained in the HECM final rule (see 82 FR 7094) published in the Federal Register on January 19, 2017.

Specifically, this Mortgagee Letter provides more detail on the following three areas of servicing policy included in the HECM final rule:

Default for Unpaid Property Charges;
Sale of Property Securing a Due and Payable HECM; and
Cash for Keys Incentive and Relocation Incentive.

The HECM final rule’s servicing requirements, including the additional guidance contained in Mortgagee Letter 2017-11, will take effect for all FHA case numbers assigned on or after September 19, 2017. Mortgagees should review the final rule in preparation for implementing these and all other origination and servicing requirements by September 19th.

System Changes
To accommodate the implementation of the servicing policies contained in the final rule, operational and functional changes will be made to FHA systems, including the Home Equity Reverse Mortgage Information Technology (HERMIT) system. FHA will communicate more details about the specific systems changes, and their implementation date, in the future.

Quick Links

View Mortgagee Letter 2017-11, Implementation of HUD’s January 2017 Home Equity Conversion Mortgage (HECM) Final Rule on HUD.gov at: https://portal.hud.gov/hudportal/documents/huddoc?id=17-11ml.pdf
Review the HECM final rule in the Federal Register at:
https://www.federalregister.gov/documents/2017/01/19/2017-01044/federal-housing-administration-strengthening-the-home-equity-conversion-mortgage-program

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.

Source: HUD (FHA INFO #17-33 full version)

Fannie Mae: Lender Letter LL-2017-04: Selling Policies for Mortgage Loans Impacted by Hurricane Harvey

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

Investor Update
August 31, 2017

Hurricane Harvey is an ongoing tragedy, and the devastating effects will linger long after the floodwaters recede. We are committed to supporting our customers and homeowners as they address the hurricane’s impacts.

Today, we published Lender Letter LL-2017-04: Selling Policies for Mortgage Loans Impacted by Hurricane Harvey to remind you of Fannie Mae’s current selling policies for loans secured by properties impacted by a disaster, including Hurricane Harvey. This letter also provides updated guidance, including the following:

To reduce the burden on our customers, Fannie Mae will reimburse both lenders and servicers for the costs associated with inspecting impacted properties.
We’re providing additional policy guidance specific to Hurricane Harvey, including requirements for delivering a loan to Fannie Mae that is secured by a property impacted by the disaster.
Desktop Underwriter® (DU®) will be updated later tonight (Aug. 31) to incorporate ZIP codes impacted by Hurricane Harvey. These ZIP codes will be excluded from consideration for a Property Inspection Waiver (PIW).

Read the Lender Letter for more details; for additional servicing information, refer to Lender Letter LL-2017-03: Servicing Policies for Mortgage Loans Impacted by Hurricane Harvey. Visit the Assistance in Disasters page for information about our policies for providing assistance to borrowers impacted by a disaster.

Source: Fannie Mae

Fannie Mae: Lender Letter LL-2017-03: Servicing Policies for Mortgage Loans Impacted by Hurricane Harvey

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

Investor Update
August 29, 2017

As we work together to support the victims of Hurricane Harvey, servicers are reminded that Fannie Mae has servicing policies to assist impacted borrowers following a disaster. For updated guidance, refer to Lender Letter LL-2017-03: Servicing Policies for Mortgage Loans Impacted by Hurricane Harvey and visit our Assistance in Disasters page for information about our policies for providing assistance to borrowers impacted by a disaster.

Lender Letter LL-2017-03

Servicing Policies for Mortgage Loans Impacted by Hurricane Harvey

In an effort to support the victims of Hurricane Harvey, we are reminding servicers that we have policies in Servicing Guide Chapter D1-3 to assist impacted borrowers following a disaster. Effective immediately, servicers must suspend any foreclosure sale on a property located within the FEMA-declared disaster area eligible for Individual Assistance as a result of Hurricane Harvey for 90 days from the date the disaster is declared. Also, we are imposing a 90-day eviction suspension on REO properties located within the FEMA-declared disaster area eligible for Individual Assistance as a result of Hurricane Harvey. The suspension covers all steps of eviction during this period.

When applicable, servicers must receive pre-approval by the mortgage insurer or guarantor to avoid jeopardizing benefits of any applicable insurance or guaranty.

We will continue to monitor the situation and reevaluate our requirements as circumstances dictate. In addition, we will issue a selling policy-related lender letter shortly.

Effective Date

Servicers must implement the moratoriums outlined above immediately.

Contact your Customer Delivery Team, Portfolio Manager, or Fannie Mae’s Single-Family Servicer Support Center at 1-800-2FANNIE (1-800-232-6643) with any questions regarding this Lender Letter.

Carlos T. Perez
Senior Vice President and
Chief Credit Officer for Single-Family

Source: Fannie Mae

Additional Resource:

Safeguard Properties (Hurricane Harvey All Client Alert summary page)

Fannie Mae: Homeowner and Servicer Mortgage Assistance Options for Gulf Coast Area Impacted by Hurricane Harvey

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

Investor Update
August 25, 2017

WASHINGTON, DC – Fannie Mae (FNMA/OTC) is reminding those in the Gulf Coast area impacted by Hurricane Harvey of the options available for mortgage assistance. Under Fannie Mae’s guidelines for single-family mortgages, servicers have the ability to grant an initial period of forbearance to any borrower they believe has been affected by this natural disaster. Additional forbearance is available with approval from Fannie Mae. In addition, Fannie Mae guidelines authorize servicers to delay foreclosure sales and other legal proceedings in these areas.

“At this time, it is important for those in the path of the storm to focus on their safety as they deal with the damage caused by Hurricane Harvey,” said Carlos Perez, Senior Vice President and Chief Credit Officer at Fannie Mae. “The primary focus of Fannie Mae and our servicers continues to be with the homeowners who have been impacted by this disaster and to ensure assistance is offered to borrowers and communities in need.”

Under Fannie Mae’s disaster relief guidelines, a servicer may temporarily suspend or reduce a homeowner’s mortgage payments for up to ninety days if the servicer believes a natural disaster has adversely affected the value or habitability of the property or if the natural disaster has temporarily impacted the homeowner’s ability to make payments on their mortgage. Since these events can make it difficult to reach homeowners, Fannie Mae allows servicers to grant this temporary relief even if they cannot contact the impacted homeowner immediately. If a servicer establishes contact with a homeowner, the servicer may offer forbearance for up to six months, which may be extended for an additional six months, for those homeowners that were current or ninety days or less delinquent when the disaster occurred.

In addition, lenders who are originating loans that will be sold to Fannie Mae are reminded that they must verify the condition of the property if it is in the area affected by the hurricane. Additional lender guidelines can be found here.

Borrowers should reach out to their servicer as soon as possible for assistance. In addition, homeowners can reach out to Fannie Mae directly by calling 1-800-2FANNIE. For more information, visit http://www.knowyouroptions.com/relief.

Source: Fannie Mae

Additional Resource:

DS News (HARVEY: Fed Agencies Issue Relief Options)

Fannie Mae: HARP Extended; Introducing Fannie Mae Invoicing; Impacts to HSSN and SMDU

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

Investor Update
August 23, 2017

HARP extended; new high LTV refi option coming soon

The Federal Housing Finance Agency (FHFA) has announced that the Home Affordable Refinance Program® (HARP®) will be extended to Dec. 31, 2018, continuing to provide liquidity to support eligible borrowers.

In addition, Fannie Mae and Freddie Mac will introduce new high loan-to-value (LTV) ratio same-investor refinance options for loans with note dates on or after Oct. 1, 2017, with a 15-month seasoning requirement. The high LTV refinance option will provide refinance opportunities to borrowers with existing Fannie Mae or Freddie Mac mortgages who are making their mortgage payments on time but whose LTV ratio for a new mortgage exceeds the maximum allowed for standard refinance products.

Under the new option, as with HARP, the refinance must provide a borrower benefit, such as a lower interest rate. Unlike HARP, the new option will not have an expiration date. To preview Fannie Mae’s new high LTV refinance option, read the fact sheet; detailed requirements will be provided in a future lender communication.

A new invoicing system to simplify servicing

We’re introducing a new web-based application, Fannie Mae Invoicing, on Sept. 25 to eventually replace the Servicer REAM Deficiency Billing System (SRDBS). Providing easy access to consolidated loan-level invoices and direct communications with the operations team to quickly resolve claims, this new system replaces manual processing and gives servicers a significantly improved experience. Read more in the fact sheet and FAQs on the Fannie Mae Invoicing page.

Reminder: Impacts to HSSN and SMDU Aug. 26-27

For users of HomeSaver Solutions™ Network (HSSN) and Servicing Management Default Underwriter™ (SMDU™) , we recommend delaying case creation and closing from 6 p.m. ET Saturday, Aug. 26 until 10 a.m. ET Sunday, Aug. 27, as information between systems may not be synchronized due to changes in investor reporting. XML bulk file submissions for HSSN submitted during this timeframe will be held and processed on Monday, Aug. 28. SMDU Auto Decision is not impacted; SMDU will remain available per the usual availability schedule.

What’s better than fall in New England?

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Source: Fannie Mae