Page 373 – Safeguard Properties

Fannie Mae Extends Foreclosure Timelines in 33 States

Posted on September 13, 2018 by Safeguard

Investor Update
September 3, 2015

Raises number of allowable days for foreclosure proceedings

Fannie Mae announced that it is increasing the maximum number of allowable days for “routine” foreclosure proceedings for much of the country.

In total, Fannie Mae increased the maximum number of allowable days for a foreclosure sale for 33 states, effective for foreclosure sales on or after Aug. 1.

Fannie Mae made the announcement Thursday in an email to its servicers.

According to the announcement, Fannie Mae increased the maximum number of allowable days for the following jurisdictions: Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Nevada, New Mexico, New Hampshire, Oklahoma, Oregon, Pennsylvania, Puerto Rico, Rhode Island, South Dakota, Tennessee, Texas, Vermont, Washington, West Virginia, Wisconsin, and Wyoming.

As part of its servicing guide, Fannie Mae establishes time frames under which it expects routine foreclosure proceedings to be completed.

According to Fannie Mae, the maximum number of allowable days takes represents the maximum allowable time lapse between the due date of the last paid installment and the completion of the foreclosure sale.

The allowable time frame also signifies the time typically required for what Fannie Mae calls a “routine, uncontested” foreclosure proceeding.

The allowable time frame reflects the legal requirements of the applicable jurisdiction, and takes into consideration delays that may occur outside of the control of the servicer, Fannie Mae said.

If the number of days to complete a foreclosure sale exceeds stated maximum number of allowable days and the servicer does not provide an adequate explanation to Fannie Mae as to the reasons for the delay, Fannie Mae requires the servicer to pay a “compensatory fee.”

According to Fannie Mae, the list of “reasonable explanations” includes:

Bankruptcy
Probate
Military indulgence
Contested foreclosure
The mortgage loan is currently in review for HAMP
The mortgage loan is in an active mortgage loan modification trial plan or unemployment forbearance
Recent legislative, administrative, or judicial changes to existing state foreclosure laws, provided that the servicer is diligently working toward resolution of the delay to the extent feasible

Fannie Mae noted in its announcement that there is currently a compensatory fee moratorium for Washington D.C., Massachusetts, New York and New Jersey and stated that the moratorium will last, “at a minimum,” until Dec. 31.

Click here to see the updated allowable foreclosure time frames for all 50 states, as well as the territories that Fannie Mae operates in.

Source: HousingWire

CFPB Written Testimony of Richard Cordray Before the House Committee on Financial Services

Posted on September 13, 2018October 29, 2018 by Safeguard

Investor Update
September 29, 2015

Chairman Hensarling, Ranking Member Waters, and Members of the Committee – thank you for the opportunity to testify today about the Consumer Financial Protection Bureau’s latest Semi-Annual Report to Congress. We appreciate your continued oversight and leadership as we work together to strengthen our financial system and ensure that it serves consumers, responsible businesses, and the long-term foundations of the American economy.

This July marked five years since the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act and four years since the Consumer Bureau opened its doors. As you know, Congress created the Bureau in response to the financial crisis with the purpose and sole focus of protecting consumers in the financial marketplace. We understand our responsibility to stand on the side of consumers and ensure they are treated fairly. Through fair rules, consistent oversight, appropriate enforcement of the law, and broad-based consumer engagement, the Consumer Bureau is working to restore people’s trust and confidence in the markets they use for everyday financial products and services.

As we continue our work, consumer financial markets are showing increasing signs of health. For example, the latest Home Mortgage Disclosure Act (HMDA) data, released by federal agencies last week, shows increasing numbers of consumers are taking out mortgages. In 2014, the first year of our new mortgage rules, mortgage originations for owner-occupied home purchases increased between four and five percent. The upward trend appears to have accelerated over the first half of this year. And while we saw some continuing consolidation in parts of the mortgage market, there is no evidence of the decline some predicted. In fact, after taking merger activity into account, the number of lenders that reported having originated mortgages showed an increase in 2014. And in particular, after adjusting for consolidations, the number of community banks and credit unions that originated home-purchase mortgages last year was up from the year before.

Other consumer credit markets also show encouraging signs. For example, in the first half of this year, over 14 million consumers obtained new auto loans, up eight percent over the prior year. For auto loans this marks a 45 percent increase since 2011 and a nine-year high. Similarly, 54 million new consumer credit card accounts were opened in the first half of 2015, which is 12 percent more than in the same period last year and 48 percent higher than in the same period of 2011. At the same time, the percentage of loan balances that are seriously delinquent dropped below four percent last quarter for the first time since 2007 and down from seven percent four years ago.

Equally heartening is the strength being exhibited by community banks and credit unions. Last quarter, lending by community banks grew by 8.8 percent compared to the prior year, growing at almost twice the rate of non-community banks. Credit union lending grew at an even faster pace, and credit union membership over the past year grew at the fastest rate in over twenty years.

As consumers gain more confidence, lenders are responding and credit standards are becoming less tight across all these markets. Consumers appear to be carrying their debt burdens more effectively, which has contributed to the fact that the delinquency rate in each of these markets is at or near record lows. These are all positive trends for the consumer financial marketplace and very much aligned with the Bureau’s mission.

The Bureau helps consumer finance markets work by making rules more effective, by consistently enforcing those rules, and by empowering consumers to take more control over their economic lives. To date, the Bureau’s enforcement activity has resulted in more than $11 billion in relief for over 25 million consumers. Our supervisory actions have resulted in financial institutions providing more than $248 million in redress to nearly 2 million consumers. And as of this month, we have handled over 700,000 complaints from consumers addressing all manner of financial products and services. Many of these consumers are constituents from each of your states, and they are pleased at the help they are receiving from the Bureau to resolve their problems and concerns.

As with the letters you receive from your constituents, the consumer complaints submitted to the Bureau raise issues of serious concern. Along with our enforcement, supervisory, rulemaking, and market-monitoring activity, these complaints and the voices of consumers are important to the Bureau. Our work is focused on ensuring that the markets for all consumer financial products and services are marked by responsible practices that help rather than harm consumers.

In our most recent Semi-Annual Report to Congress and the President, we describe the Bureau’s efforts to achieve our vital mission on behalf of consumers, including those in your home states and mine. For example, we took action against a company for illegal debt collection practices resulting in $2.5 million in relief for servicemembers. We also stopped an illegal kickback scheme for marketing services, which resulted in $11.1 million in redress for wronged consumers. We also worked with the Department of Education to obtain $480 million in debt relief to student loan borrowers who were wronged by Corinthian Colleges, a for-profit chain of colleges that violated the law and has since declared bankruptcy.

During the reporting period, the Bureau also issued a number of proposed and final rules. In October 2014, we issued a final rule to reduce burdens on industry by promoting more effective privacy disclosures from financial institutions to their customers. In November 2014, the Bureau issued a Notice of Proposed Rulemaking to provide strong new federal consumer protections for prepaid accounts. In December 2014, the Bureau issued a proposal to clarify various provisions of our mortgage servicing rules. The Bureau is in the process of developing new rules governing payday, vehicle title, and certain installment loans. Earlier this month, the Bureau finalized further changes to some of our mortgage rules to facilitate mortgage lending by small creditors, particularly in rural or underserved areas. These changes will increase the number of financial institutions able to offer certain types of mortgages in rural or underserved areas, and help small creditors adjust their business practices to comply with the new rules.

As a data-driven institution, the Consumer Bureau published several reports during this reporting period that highlight important topics in consumer finance such as medical debt, arbitration agreements, reverse mortgages, and consumer perspectives on credit scores and credit reports. We also released a new “Know Before You Owe” mortgage toolkit that will help encourage consumers to shop for mortgages and better understand how to go about buying a home.

In the years to come, we look forward to continuing to fulfill Congress’s vision of an agency that is dedicated to cultivating a consumer financial marketplace based on transparency, responsible practices, sound innovation, and excellent customer service.

Thank you for the opportunity to testify today. I look forward to your questions.

Source: CFPB

VALERI Servicer Newsflash

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

Investor Update
July 31, 2015

On July 31, 2015, the Federal Register announced the Department of Veterans Affairs (VA) Maximum Allowable Attorney Fees.

VA Central Office has identified errors within the notification:

The District of Columbia Judicial Foreclosure shows N/A; however, should reflect an allowable amount of $2300.
The Oregon Judicial Foreclosure shows N/A; however, should reflect an allowable amount of $2600.
The last sentence in the first paragraph under Supplementary Information should read, “Paragraph (b)(5)(ii) of section 36.4314 describes the procedures to be followed in determining what constitutes the reasonable and customary fees for legal services in the termination of a loan”.
The second sentence in foot note 2 should read, “For additional requests for relief filed under each bankruptcy chapter, VA will allow an additional $250”.

The revisions will be reflected in a future correction to the Federal Register.

Please click here to view the newsflash online.

VALERI Servicer Newsflash

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

Investor Update
August 5, 2015

IMPORTANT INFORMATION
Legacy Loan Project – VA is in the process of removing inactive loans from the VA Loan Electronic Reporting Interface (VALERI) application that are categorized as Legacy Loans. A Legacy Loan is defined as either having been inactive for 720 days after termination or 425 days after the loan shows paid-in-full. Many of the inactive loans were already terminated prior to the migration from the previous VA servicing application into the VALERI application in 2008. If you search for a loan that has been removed in VALERI, you will receive a message indicating the loan is no longer available (see Development Update below regarding CQ10688). For information regarding unavailable loans, please contact the VALERI Helpdesk. We will continue to provide you information regarding this project. If you have any questions or concerns, please contact the VALERI Helpdesk at valerihelpdesk.vbaco@va.gov.

DEVELOPMENT UPDATES

On Tuesday, July 21, 2015, VALERI 3.4 BI Reports manifest was released. The following system enhancements were included:

CQ11229 – Post Audit Selection – This high-level report provides a list of open cases selected for post-audit review. The report is located under the Servicer Operational Reports in VALERI.

CQ11231 – Post Audit Summary – This report name has been changed to Post Audit and Appeal Post Audit Summary.

CQ10223 – Payment Denial – This report description has been updated.
On Saturday, August 8, 2015, VALERI Manifest 3.5 will be deployed. The following system enhancements will be included:

CQ11511 – Additional line item added to allowable expense items – Auction Service Fee. This fee will now be available for servicers who use an auction service to complete the termination of VA-guaranteed loans. Refer to Circular 26-15-16 for additional information. The new claim bulk upload template will be uploaded and available for servicers on Monday, August 10, 2015.

CQ11399 – Business Rule for Results of Sale (ROS) event – Additional logic has been added in VALERI that will reject a second ROS event if a previous ROS event has processed successfully.

CQ11473 – The Contact Information Change (CIC) event will now require the borrower name field to be completed every time the event is reported. VALERI will reject the data if the borrower name is not populated.

CQ11460 – Correction made to the defect where a User Login Name had a numeric character. Company Administrators should now have the ability to activate or edit a user profile if the Login Name has any numeric characters.

CQ10688 – Searching for a Legacy Loan will result in a message being displayed advising the loan does not exist in VALERI and you can reach out to the VALERI Helpdesk if you need assistance.

Please click here to view the newsflash online.

Stephen W. Warren Named the OCC?s Chief Information Officer

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

Investor Update
August, 6, 2015

WASHINGTON — Stephen W. Warren today was named Chief Information Officer (CIO) at the Office of the Comptroller of the Currency (OCC).

As CIO, Mr. Warren will lead all OCC information technology (IT) programs, supporting the agency’s mission of ensuring the safety and soundness of national banks as well as fair and equal access to financial services for all Americans.

“Stephen brings deep experience in information technology to our agency,” said Kathy Murphy, Senior Deputy Comptroller for Management and Chief Financial Officer. “His experience leading large federal IT functions and overseeing delivery of solutions that have helped other agencies will help us deliver even more effective systems, increase employee engagement, and enhance customer service to our agency’s employees and the institutions we regulate.”

Mr. Warren joins the OCC with more than 15 years of experience as a CIO or senior IT official. He previously served as acting CIO at the Department of Veterans Affairs and CIO at the Federal Trade Commission, and for the Office of Environmental Management with the Department of Energy. He will join the OCC on September 6, 2015.

Mr. Warren holds a masters of science in systems management from the Florida Institute of Technology and a bachelor of science in nuclear engineering from the University of Michigan. He began his career as an active duty officer in the U.S. Air Force.

Please click here to view the press release online.

New Proposed Bankruptcy Rules: Focus on Periodic Statements

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

Investor Update
August 7, 2015

The CFPB’s Judicial Conference Advisory Committee on Bankruptcy Rules has proposed a variety of changes and updates that apply to periodic statements – many of which could have important and potentially difficult implications for servicers. The periodic statement is one of the areas that – depending on the conditions required by the final rules – could become substantially more costly to manage and to deliver. By comparison, today servicers operate based on a simple exemption from the need to deliver periodic statements to any of the obligors in bankruptcy.

Under the CFPB’s proposed rules, most borrowers in bankruptcy would receive periodic statements/coupons, unless the borrower requests that the servicer stop sending them; surrenders the property; the court avoids the lien; or the lien is relieved from stay. Other nuances also apply, such as the proposed provision that non-filing co-borrowers must also receive periodic statements or coupons.

Finally, the proposed rules would also require statements to be tailored specifically for the particular bankruptcy chapter that has been filed. If the case is ultimately dismissed, discharged, closed, or the borrower reaffirms the debt or requests statements, servicers must resume sending periodic statements.

The Industry Weighs In

The CFPB received feedback on the proposed bankruptcy rules through March of this year, and many concerns were brought forward. As it relates to periodic statements, the American Financial Services Association (AFSA), along with many other industry participants, provided well-reasoned input to the CFPB Committee for consideration. The AFSA comments are further detailed in the AFSA – CMC Comments on Proposed Servicing Regulations, dated March 16, 2015

The AFSA outlined five primary positions related to when periodic statements should be required – and for whom. The key points made by the AFSA are briefly summarized as follows:

1. Statements should be based on the content of the debtor’s file pending confirmation

2. Opting out of periodic statements by the borrower should not be required twice (in the case that borrowers may have already opted out of receiving statements – but might have to do so again once the final rules go into effect)

3. Statements should remain permissible in Chapter 7 ride-throughs, even when they are not required and the consumer does not specifically opt in to receive them. The AFSA wants assurance that doing so would not incur a Regulation Z violation around impermissible collection activities

4. Cram-downs, which occur when obtaining confirmation of a plan that modifies one or more terms, including those that might render some or all of the mortgage debt as unsecured – should not require statements

5. Servicers should not be required to provide bankruptcy trustees with copies of periodic statements, given that they already have access to all the information they need to perform their statutory duties.

The proposed rules represent a significant departure from the periodic statement requirements that today’s default servicing operations are built around. To help bring that point into greater focus, here is a simple comparison:

Today: Servicers are exempt from providing periodic statements if any obligor is in bankruptcy.

Proposed: Servicers are only exempt from providing periodic statements if the borrower is a debtor in bankruptcy; is in either Chapter 12 or 13 bankruptcy; or is discharged from personal liability. In addition, at least one of the following conditions must be present:

The servicer must have received a written request from the borrower or borrowers to cease sending statements or coupon book
The borrower or borrowers must have filed a statement in court of his or her intention to surrender the dwelling
The Court has entered an order to avoid the borrower’s lien, lift automatic stay, or cease periodic statements or coupons
The borrower’s confirmed plan provides for surrender of the property, lien avoidance, and/or no pre- or post-petition payments are due

To accommodate the many different possibilities, and depending on the provisions contained in the final rules, servicers must be prepared to manage through the increased level of complexity that may be associated with periodic statements for borrowers in bankruptcy.

Other Provisions Under Consideration

In addition to the potential changes to the conditions under which servicers are required to provide periodic statements to those in bankruptcy, there are a number of other provisions under consideration that would impact the content of periodic statements. Depending on the debtor’s circumstances, specific content must be included on the statement – while other content may not be required at all. The proposed rules even address terminology options: for example, “amount due” can be adjusted to read “payment amount”.

While this article is intended to be a high level overview of the proposed rules for Bankruptcy Periodic Statements, there is certainly is a great deal of important detail that is not addressed here. Industry professionals should continue to carefully consider the proposed changes to the Federal Rules of Bankruptcy Procedure and Official Forms. While servicers will have one year from the date the final rules are published to comply with the requirements, it’s a good idea to begin thinking about how they will approach the changes to periodic statements that may eventually come.

Please click here to view the article online.

MHA Supplemental Directive 15-07 Making Home Affordable Program ? Handbook Mapping for Streamline HAMP

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

Investor Update
August 11, 2015

In February 2009, the Obama Administration introduced the Making Home Affordable (MHA) Program to stabilize the housing market and help struggling homeowners obtain relief and avoid foreclosure. In March 2009, the U.S. Department of the Treasury (Treasury) issued uniform guidance for loan modifications by participants in MHA across the mortgage industry and subsequently updated and expanded that guidance. On June 1, 2015, Treasury issued version 4.5 of the Making Home Affordable Program Handbook for Servicers of Non-GSE Mortgages (Handbook), a consolidated resource for guidance related to the MHA Program for mortgage loans that are not owned or guaranteed by Fannie Mae or Freddie Mac (Non-GSE Mortgages).

On July 1, 2015, Treasury issued Supplemental Directive 15-06 announcing a “streamlined” modification process under the Home Affordable Modification ProgramSM (HAMP®) for Non-GSE Mortgages (referred to as Streamline HAMP). Streamline HAMP is designed to assist borrowers who meet basic HAMP eligibility criteria and, among others, those who have not completed an application by the time their loan is 90 days delinquent.

This Supplemental Directive provides mapping of the Handbook for the guidance provided in Supplemental Directive 15-06 and provides further administrative clarifications on such guidance. Servicers that are subject to or adopt the guidance in Supplemental Directive 15-06 must follow the guidance set forth in this Supplemental Directive. This guidance does not apply to mortgage loans that are owned, securitized or guaranteed by Fannie Mae or Freddie Mac (each, a GSE), or insured or guaranteed by the Veterans Administration, the Department of Agriculture’s Rural Housing Service (RHS) or the Federal Housing Administration (FHA).

Handbook Mapping

Supplemental Directive 15-06 amended and superseded the notated portions of the Handbook. Attached to this Supplemental Directive as Exhibit A is the mapping of the Handbook which delineates the changes thereto attributable to the guidance provided in Supplemental Directive 15-06. The changes to the Handbook described in this Supplemental Directive are effective as of January 1st, 2016.

Administrative Clarifications

Non-Approval Notices

Supplemental Directive 15-06 requires that a servicer send a Non-Approval Notice to a borrower in a Streamline HAMP trial period plan who makes timely payments but fails to return the executed Streamline HAMP documents (i.e., the Streamline HAMP Affidavit and/or the Streamline HAMP Modification Agreement) on a timely basis. This Supplemental Directive clarifies this requirement such that any HAMP borrower who is in a trial period plan but fails to return the applicable permanent modification documents must be sent a Non-Approval Notice indicating the failure to return the required documentation.

The model clauses for borrower notices in Exhibit A to the Handbook have been updated to reflect this guidance. An updated list of reason codes will also be made available in the HAMP Additional Data Requirements Data Dictionary at www.HMPadmin.com.

Please click here to view SD 15-07 [pdf] in its entirety.

MHA HAMP Update Streamline HAMP NPV Tool and Documentation Available

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

Investor Update
August 27, 2015

The Streamline HAMP NPV Tool v1.0 and relevant documentation are now available for servicers interested in offering Streamline HAMP under the Home Affordable Modification Program® (Streamline HAMP).

Servicers can access the files in the “Streamline HAMP NPV Tools & Documents” section of HMPadmin.com (login required).

The Streamline HAMP NPV Tool is designed to help servicers evaluate their portfolio and determine their policies for offering Streamline HAMP. Information about its development and use is available in the accompanying documentation.

The Streamline HAMP NPV Tool and documentation are subject to the license and other terms and conditions of the Terms of Use of HMPadmin.com and are included within the term “NPV Model Documentation” referred to in the Terms of Use.

Questions?
Email the HAMP Solution Center or call 1-866-939-4469.

Source: MHA

MHA HAMP Reporting Update Net Present Value (NPV) Reporting Guidance Job Aid Posted

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

Investor Update
August 24, 2015

An NPV Reporting Guidance job aid has been added to the Learning Center on HMPadmin.com.

Please refer to this document for instructions on reporting NPV.

Questions?
Email the HAMP Solution Center or call 1-866-939-4469.

Source: MHA

HUD MCM Contract Response Letter to MBA

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

Investor Update
August 7, 2015

U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
WASHINGTON, DC 20410-8000
OFFICE OF HOUSING

Mr. Pete Mills
Senior Vice President of Residential Policy and Member Services
Mortgage Bankers Association
1919 M Street NW, 5th Floor
Washington, DC 20036-3572

Dear Mr. Mills:

Thank you for your letter of July 2, 2015, on behalf of the Mortgage Bankers Association (MBA), requesting that the Department of Housing and Urban Development (HUD) work with the MBA and its members to facilitate the transfer of responsibilities to HUD’s new Mortgagee Compliance Manager (MCM) contractor, ISN Corporation (ISN). The Department has reviewed the MBA’s request and would like to address each of the MBA’s concerns, as stated in its letter, and share the following information regarding the transition.

What is the transition timeframe and planned transition steps?

The MCM transition to ISN will include a minimum of 60 days of training by the incumbent, Michaelson, Connor & Boul (MCB).

If a protest is lodged, how will this impact the timeframe?

A protest was filed and has been resolved; therefore, MCB’s contract was extended to account for delays due to the protest.

When is the handover date to the new provider?

ISN is expected to begin full performance within 60 to 90 days from the date of this letter.

When will servicers be provided with a contact list for ISN and an escalation matrix?

ISN is developing a webpage which will include a list of contacts for specific MCM activities.

Is the new contract only for new work or does it cover the existing pipeline as well?

At the end of transition, ISN will become responsible for all work in progress, as reflected in HUD’s Asset Disposition System (P260), and all new acquisitions.

How does the status of the technology contract (P260) interplay with the MCM award and does this introduce additional complications? How will the activities that are managed outside of P260 be handled?

The award of a new P260 contract will not affect MCM processes. All MCM activities are handled through P260, and all information pertaining to work in progress will be transferred to ISN.

In the April MBA-FHA working group meeting, it was mentioned that the new MCM would have greater delegated authority. What are these changes?

ISN, as the MCM contractor, will operate under the same HUD policies governing the existing MCM contractor.

Are there any changes to the existing processes that are foreseen due to the award of the contract to ISN?

While there are no existing process changes expected at this time, HUD is continually reviewing all of its Management and Marketing contractors’ processes to determine how to enhance them for the purpose improving the real estate owned (REO) conveyance and disposition process.

The Department appreciates the MBA and it’s member’ participation in HUD’s housing programs and looks forward to continued dialogue to help ensure a seamless and efficient transition to ISN. If you have additional questions regarding this matter, please do not hesitate to contact me on (202) 402-5628 or Matt Martin, Director, National Servicing Center on (405) 609-8533.

Sincerely,

Ivery W. Himes
Director
Office of Single Family Asset Management

Please click here to view the letter [pdf].

Please click here to view the MBA’s original inquiry letter to HUD [pdf].