Safeguard Properties

FHA Streamlines Process to Help Delinquent Homeowners Avoid Foreclosure and Remain in Their Homes

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Investor Update
August 25, 2016

WASHINGTON – The Federal Housing Administration (FHA) today announced new procedures to strengthen the process mortgage servicers use to help struggling families avoid foreclosure and remain in their homes.  FHA is streamlining its loss mitigation protocols that servicers must use when evaluating and deploying ‘home retention options,’ foreclosure alternatives that allow delinquent borrowers to retain their home.  Read FHA’s mortgagee letter.

FHA’s revised procedures streamline the process servicers use to engage borrowers, specifically when evaluating them for the FHA-Home Affordable Modification Program (FHA-HAMP).  These changes will reduce the number of steps that a servicer and borrower must take to resolve a delinquency and enter into a loss mitigation home retention product.  In addition, FHA is removing certain obstacles that will allow servicers greater flexibility for evaluating an unemployed borrower for a special forbearance agreement.

Specifically, FHA will:

  • Require servicers to convert successful 3-month trial modifications into permanent modifications within 60 days instead of the average four-to-six months;
  • Allow borrowers with three missed mortgage payments to qualify for a partial claim to bring their arrearages current versus the previous requirement for a minimum of four missed payments;
  • End the traditional stand-alone Loan Modification option so struggling borrowers can access the FHA-HAMP option, with its greater payment relief, sooner; and
  • Eliminate the required 12-monthterm for FHA’s special forbearance option.  This will allow servicers to offer this option to more unemployed households.

Source: HUD

FHA INFO #16-55: Guidance for FHA-Approved Mortgage Servicers Regarding Presidentially-Declared Major Disaster Areas/ML-2016-13/ML-2016-14

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Investor Update
August 25, 2016

Reminder: Guidance for FHA-approved Mortgage Servicers regarding Presidentially-Declared Major Disaster Areas

Today, the Federal Housing Administration (FHA), in light of the recent Presidentially-Declared Major Disaster Area (PDMDA) in the State of Louisiana due to damage caused by severe storms and flooding, issued a reminder that mortgages secured by properties in a PDMDA are subject to a 90-Day moratorium on foreclosures following the disaster. HUD provides mortgagees an automatic 90-Day extension from the date of the moratorium expiration date to commence or recommence foreclosure action or evaluate the borrower under HUD’s Loss Mitigation Program. See Presidentially-Declared Major Disaster Areas (Section III.A.3.c.ii.) in the Single Family Housing Policy Handbook 4000.1 (SF Handbook).

Quick Links

Updates to FHA’s Loss Mitigation Retention Options and Miscellaneous Mortgage Servicing Procedures Mortgagee Letter

On August 24, 2016, the Federal Housing Administration (FHA) published Mortgagee Letter 2016-14, “Updates to FHA’s Loss Mitigation Retention Options and Miscellaneous Mortgage Servicing Policy,” which announces revisions to FHA’s procedures for evaluating and using its Loss Mitigation Home Retention Options, and other operational changes for mortgagees servicing FHA-insured Title II forward mortgages. The revisions contained in Mortgagee Letter 2016-14, including a revised HUD Loss Mitigation Priority Option Waterfall, are designed to streamline the loss mitigation process for servicers while strengthening their ability to more quickly and effectively engage in loss mitigation home retention actions for the purpose of providing an alternative to foreclosure.

Specific revisions contained in Mortgagee Letter 2016-14 are designed to:

  • Streamline FHA’s loss mitigation waterfall to support more efficient borrower engagement, specifically when evaluating a borrower for the FHA Home Affordable Modification Program (FHA-HAMP) option, which is a sustainable and effective loss mitigation home retention option;
  • Reduce the number of steps that a servicer and borrower must take to resolve a delinquency and enter into a loss mitigation home retention product; and
  • Provide additional flexibility that servicers can extend to borrowers, including revised procedures for evaluating a borrower’s financial condition and special forbearance agreements for unemployed borrowers, to remove unnecessary obstacles for a borrower to be eligible for a home retention option.

This Mortgagee Letter also contains operational and reporting changes and clarifications for servicers related to: using independent third-party providers to conduct Claims Without Conveyance of Title (CWCOT) property sales transactions; the Manufactured Housing Review; and other changes.

Servicers must implement the procedures set forth in this Mortgagee Letter no later than December 1, 2016. Revisions to the Single Family Housing Policy Handbook 4000.1 (SF Handbook) included in Mortgagee Letter 2016-14 will be incorporated into the SF Handbook’s online format and portable document format (PDF) at a future date.

Quick Links

Extension of Temporary Approval Provisions for the Condominium Project Approval Process Mortgagee Letter

On August 24, 2016, the Federal Housing Administration (FHA) announced via Mortgagee Letter 2016-13, “Extension of Temporary Approval Provisions for the Federal Housing Administration (FHA) Condominium Project Approval Process,” that it is extending its temporary condominium project approval policy provisions, without changes, until August 31, 2017.

As noted in the Mortgagee Letter, FHA’s temporary condominium project approval policy provisions were issued in its September 13, 2012 Mortgagee Letter 2012-18, and its November 13, 2015 Mortgagee Letter 2015-27. The provisions in these Mortgagee Letters are applicable to all Title II programs, including the Home Equity Conversion Mortgage program, unless otherwise stated.

The extension of FHA’s temporary provisions for condominium project approvals supports the continuation of FHA’s ability to insure mortgages in condominium projects and avoid market disruption, while work continues on the rulemaking necessary to propose policy revisions and address items in the Housing Opportunity Through Modernization Act of 2016, which was signed by the President on July 29, 2016.

Quick Links

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 #16-55 full version)

FHA INFO #16-54: Property Disposition Regulations Final Rule

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Investor Update
August 11, 2016

Today, the Federal Housing Administration (FHA) published a final rule in the Federal Register, Disposition of HUD-Acquired Single Family Properties; Updating HUD’s Single Family Property Disposition Regulations (Docket No. FR-5776-F-02). The final rule revises HUD’s property disposition regulations.

The final rule follows the October 2, 2015, publication of the proposed rule, during which time public comments were solicited. After consideration of comments received, FHA adopted the proposed rule with minor changes and issued its final rule today.

Specifically, this rule consolidates and reorganizes these regulations to better reflect industry standards, and allows HUD to conduct its Single Family Property Disposition Program more efficiently and effectively. Policy revisions and future effective dates will be incorporated into a future update of FHA’s Single Family Housing Policy Handbook 4000.1.

Quick Links

Home Equity Conversion Mortgage Program Supplemental Notice of Proposed Rulemaking Published in the Federal Register

Today, the Federal Housing Administration (FHA) published in the Federal Register, a supplemental notice of proposed rulemaking (Docket No. FR-5353-N-02) to its original May 19, 2016, Home Equity Conversion Mortgage (HECM) proposed rule, Strengthening the Home Equity Conversion Mortgage Program.

The supplemental notice provides for an additional public comment period solely to address a suggested change offered by a commenter on the May 19 proposed rule.

FHA is soliciting public comments on the supplemental notice during a 30-day period. All comments must be submitted to FHA through the formal methods detailed in the proposed rule.

Quick Links

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 #16-54 full version)

Fannie Mae: Updated AAA Matrix

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Investor Update
August 10, 2016

The AAA matrix provides state-specific excess fees/costs process guidelines and includes a process overview, as well as additional procedures and specific request requirements.
 
The matrix references applicable Servicing Guide provisions and other policies.
 
Fannie Mae requires the attorneys to submit all excess fee and title cost requests. Requests made by servicers will not be accepted.

Source: Fannie Mae (Excess Attorney Fee Guidelines page full version)

Fannie Mae: Updated AAA Matrix

Posted on by Safeguard

Investor Update
August 2, 2016

The AAA matrix provides state-specific excess fees/costs process guidelines and includes a process overview, as well as additional procedures and specific request requirements.
 
The matrix references applicable Servicing Guide provisions and other policies.
 
Fannie Mae requires the attorneys to submit all excess fee and title cost requests. Requests made by servicers will not be accepted.

Source: Fannie Mae (Excess Attorney Fee Guidelines page full version)

Fannie Mae Standard Modification Interest Rate Exhibit

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Investor Update
August 10, 2016

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

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.

Source: Fannie Mae (Standard Modification Interest Rate Exhibit Table)

Fannie Mae Single Family Servicing News: Updated Servicer Expense Reimbursement Job Aids and New Know Your Options Webinars

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Investor Update
August 24, 2016

Updated Servicer Expense Reimbursement Job Aid

The Servicer Expense Reimbursement Job Aid has been updated and posted to the business portal. This Job Aid provides operational instructions based on servicing policies. Specific updates to the Job Aid include:

  • Updates to the reference document for all LoanSphere Invoicing expense categories and subcategories, Servicer Expense Reimbursement Line Items in LoanSphere Invoicing™
  • Reintroduction of the Pending Servicer Review status to be monitored by Servicers
  • Introduction of Pre-Payment and Post-Payment expense reviews
  • Simplified documentation requirements
  • New requirements for reoccuring property inspections and utility expenses
  • Additional links to the Fannie Mae Servicing Guide for quick references

Know Your Options Customer CARE Call Flow & Script Training Webinars

Know Your Options™ Customer CARE (Connect, Assess, Resolve, and Execute) provides participating servicers with free loss mitigation training that leverages a servicer’s ownership model to:

  • Develop rapport and establish consultative customer relationships.
  • Maintain quality right party contact throughout the default management process.
  • Properly position available workout solutions.

Learn more about this transformational re-design of the loss mitigation process at the next Know Your Options Customer CARE Call Flow & Script Training webinars (Sept. 7 and 8, 2016). These two-hour sessions will provide program information and training on the Know Your Options Customer Care 7-Step Call Flow scripts and job aids.

Click here to register today.
 
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Servicers, we’ve updated our Servicing Guide. This short video gives you the highlights: 
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Source: Fannie Mae

Fannie Mae Single Family Servicing News: Evaluation Notice Model Clauses and Streamlined Modification Solicitation Letters Updated

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Investor Update
August 3, 2016

The Evaluation Notices exhibit and the solicitation letters for the Streamlined Modification and Streamlined Modification Post Disaster Forbearance have been updated to reflect policy changes from Servicing Guide Announcement SVC-2016-05 in connection with the termination of the Fannie Mae Home Affordable Modification Program (HAMP), including the exclusion of references to HAMP or HAMP-related programs from certain borrower communications beginning September 1.

See the Servicing Guide Exhibits page to access the files, or click the links below:

Summer is Still Here! Sharpen your Investor Accounting Skills with HFI InDepth for Half the Price

Are you involved in investor accounting for your company? HFI® InDepth virtual classes provide training in custodial accounting, reconciling actual/actual loans, and MBS accounting. You’ll learn tips for reporting on your loans and have access to an expert instructor who can answer your questions during a two-hour session from the comfort of your desk.

Regular price: $250
Summer price: $125 (June 20 through September 22)

Register today and automatically get the summer discount for one or more of these HFI InDepth classes:

Recent Tweets

Why does housing affordability and #mortgage credit access still matter in this #housing market?
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More people are remodeling or planning to remodel their homes. What might this mean for your #mortgage business?
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Source: Fannie Mae

Fannie Mae Single Family Servicing News: Announcement SVC-2016-07: Servicing Guide Updates

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Investor Update
August 17, 2016

Updates have been made related to the following:

  • Independent Dispute Resolution (IDR)
  • Allowable Foreclosure Attorney Fee for New York
  • Termination of Conventional MI
  • Suspending Foreclosure Proceedings for a Streamlined Modification Offer
  • Servicing Government Mortgage Loans
  • MI Claim Filing Documentation

Read the Announcement for full details.

With this month’s Servicing Guide update, we are introducing two new resources to help you stay informed about changes to servicing policy. For a summary of key updates in this Servicing Guide Announcement, view the video presented by Bill Cleary, Vice President of Single-Family Servicing Policy & Solutions, or check out the Guide Update Presentation here.

Principal Reduction Servicer FAQ Document Updated

The Principal Reduction Modification Servicer FAQ document has been updated and posted to the business portal. Question 17 has been added.

Future Changes to Investor Reporting

Together with our customers we are moving closer to implementing Future Changes to Investor Reporting scheduled for February 1, 2017. To support you with this transition, Fannie Mae is hosting monthly forums to provide details about what is changing and why, answer questions, and discuss best practices. All servicers who do business with us are encouraged to attend. Register for one of the available sessions today, as space is limited. Visit the Future Changes to Investor Reporting page to register, as well as the latest information and resources.

Extermination Allowable Usage

Servicers may now utilize the established $100 Extermination allowable (see, Servicing Guide F-1-06, Expense Reimbursement) for mosquito dunks/bits in pools or standing water on delinquent loans. This low cost item (approximate $10-$15 material cost) can easily be coordinated with your grass-cut schedules as a best practice to keep costs low.

Reimbursement requests should be submitted under Property Services -> Extermination line.

In the event the Extermination allowable was already utilized this calendar year, an over allowable request may be submitted through HomeTracker on the “Extermination” service line for Fannie Mae review.

Drainage of above ground pools, spas, etc. may be a viable alternative solution. An over allowable request for drainage may be submitted through HomeTracker on the “Pool Securing Drain” service line for Fannie Mae review.

For additional questions, please contact Fannie Mae’s property preservation team at: property_preservation@fanniemae.com.

Updated Framework Course Helps Homeowners Succeed

HomeReady® mortgage borrowers will now experience an even better online homeownership course offered by our partner, Framework®, which recently announced enhancements including:

  • Smaller bites of information for quicker comprehension
  • No narration, so learners can read at their own pace
  • More real-life examples for context
  • More downloadable document guides, tip sheets and checklists
  • Post-purchase support through Framework’s Smart Start

Framework’s Smart Start is an educational series of helpful tips and how-tos delivered on a monthly basis via email for a year following completion of the new course.

Read the recent Housing Industry Forum article for details on how Framework redesigned the new course. Visit the HomeReady page to learn more about the options available to meet the HomeReady homeownership education requirement.

Summer is Still Here! Sharpen your Investor Accounting Skills with HFI InDepth for Half the Price

Are you involved in investor accounting for your company? HFI® InDepth virtual classes provide training in custodial accounting, reconciling actual/actual loans, and MBS accounting. You’ll learn tips for reporting on your loans and have access to an expert instructor who can answer your questions during a two-hour session from the comfort of your desk.

Regular price: $250
Summer price: $125 (June 20 through September 22)

Register today and automatically get the summer discount for one or more of these HFI InDepth classes:

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Receive regular content updates by registering at the sites.
 
Recent Tweets

What did @Kim_Betancourt tell @CNBC the impact #Brexit could have on U.S. housing? Find out:
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Source: Fannie Mae

Fannie Mae Reminds Homeowners and Servicers of Options for Areas Affected by the Louisiana Flooding

Posted on by Safeguard

Investor Update
August 15, 2016

WASHINGTON, DC – Fannie Mae (FNMA/OTC) is reminding those affected by the floods in Louisiana 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.

“We know that many people have had their lives disrupted by the flooding in Louisiana,” said Malloy Evans, Vice President of Servicing at Fannie Mae. “Our servicers are committed to helping homeowners affected by natural disasters and we are grateful for their efforts to offer the appropriate assistance to families in need. Our thoughts are with all of those who have been impacted.”

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 flooding. 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.

Fannie Mae helps make the 30-year fixed-rate mortgage and affordable rental housing possible for millions of Americans. We partner with lenders to create housing opportunities for families across the country. We are driving positive changes in housing finance to make the home buying process easier, while reducing costs and risk. To learn more, visit fanniemae.com and follow us on twitter.com/fanniemae.

Source: Fannie Mae