Safeguard Properties

HUD ML 2013-34 Delayed Implementation of “PFS Participation Requirement”

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On September 27, the U.S. Department of Housing and Urban Development (HUD) issued Mortgagee Letter 2013-34, regarding the delayed implementation of “PFS Participation Requirement” section included in Mortgagee Letter 2013-23.

MORTGAGEE LETTER 2013-34

To: All FHA-Approved Mortgagees Servicing Single Family Mortgages

Subject: Delayed Implementation of “PFS Participation Requirement” Section
included in Mortgagee Letter 2013-23, Updated Pre-Foreclosure Sale (PFS)
and Deed in Lieu (DIL) of Foreclosure Requirements

Purpose: Implementation of the “PFS Participation Requirement” section stipulated in
Mortgagee Letter (ML) 2013-23 has been delayed until further notice. PFS
participation requirements denoted in ML 2008-43, 2002-13, and 2000-05
remain in effect.

All other provisions included in ML 2013-23 remain in effect.

Affected Policy: The policies set forth in this Mortgagee Letter amend the effective date
of the “PFS Participation Requirement” section of ML 2013-23.

Information Collection Requirements: The information collection requirements
contained in this document have been approved by the Office of Management and
Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520)
and assigned OMB control number 2502-0584. In accordance with the Paperwork
Reduction Act, HUD may not conduct or sponsor, and a person is not required to
respond to, a collection of information unless the collection displays a currently
valid OMB Control Number.

Questions: Any questions regarding this Mortgagee Letter may be directed to the HUD National Servicing Center at (877) 622-8525. Persons with hearing or speech impairments may reach this number by calling the Federal Information Relay Service at (800) 877-8339. For additional information on this Mortgagee Letter, please visit www.hud.gov/answers.

Signature: Carol J. Galante
Assistant Secretary for Housing-Federal Housing Commissioner

To view the online Mortgagee Letter, please click here.

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

HUD Announces New Short Sale Requirements

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On October 1, DSNews published an article titled HUD Announces New Short Sale Requirements.

HUD Announces New Short Sale Requirements

Effective October 1, 2013, HUD has announced the following changes to their Federal Housing Administration (FHA) short sale requirements.

To be eligible, one must successfully complete a short sale under the FHA short sale program. The borrowers must meet the following requirements:

1) They cannot list the property with or sell it to anyone with whom they are related or have a close personal or business relationship. In legal terms, it must be an “arm’s-length” transaction. 2) Any knowing violation of the arm’s-length requirement may be a violation of federal law. 3) Your mortgage must be in default, on the date the short sale transaction closes.

Before closing, any additional liens against the property must be released. A lien holder who demands a payment to release its lien must submit a written statement, and an agreement to release the lien if that amount is paid.

For a standard preforeclosure sale, servicers must use a Deficit Income Test (DIT) to determine a homeowner’s financial hardship. The IRS Collection Financial Standards is used to verify homeowners expenses not reflected in their credit report. Only owner-occupied properties are eligible for the standard preforeclosure sale.

Homeowners eligible for a streamlined short sale may not be required to submit financial information or have a financial hardship. Principal residences, second homes, investment properties, and service members who have received Permanent Change of Station (PCS) Orders are potentially eligible.

The appraisal of one’s property should be completed within approximately ten business days. After the appraisal, the short sale file will be updated and prepared for review. In some cases, approval may be required by the investor and/or FHA, which may take more time.

As a new condition, one might be required to make a final payment (sometimes called a cash contribution) before closing. This payment will reduce the deficiency balance.

If one is an owner-occupant, acting in good faith, and successfully selling one’s property, one may be eligible for an incentive of up to $3,000.

The revised FHA short sale addendum must be signed and dated by all parties. Under this addendum, all parties agree that the subject property must be sold through an arm’s-length transaction. An arm’s-length transaction is defined as a short sale between two unrelated parties that is characterized by a selling price and other conditions that would prevail in an open market environment. Also, no hidden terms or special understandings can exist between any of the parties (e.g., buyer, seller, appraiser, sales agent, closing agent, and mortgagee) involved in the transaction.

To view the online article, please click here.

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

HUD Allocates Additional $5B to Hurricane Sandy Impacted Communities

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On October 28, the U.S. Department of Housing and Urban Development (HUD) released an update titled HUD Announces Additional $5 Billion in Recovery Funds for Communities Impacted by Hurricane Sandy.

HUD ANNOUNCES ADDITIONAL $5 BILLION IN RECOVERY FUNDS FOR COMMUNITIES IMPACTED BY HURRICANE SANDY
Second round of funding for five states, New York City to address remaining needs

WASHINGTON – One year after Hurricane Sandy devastated coastal communities in the Northeast, the U.S. Department of Housing and Urban Development (HUD) today allocated a combined $5 billion through a second round of recovery funds to five states and New York City. Provided through HUD’s Community Development Block Grant (CDBG) Program, these recovery funds will assist impacted communities to meet remaining housing, economic development and infrastructure needs.

Last February, one week after President Obama signed into law the Disaster Relief Appropriations Act of 2013, HUD quickly allocated $5.4 billion to assist communities located in the most impacted areas. The second round of funding announced today is intended to support remaining unmet recovery needs that continue to confront these communities one year after the storm.

“One year later, it’s clear these communities continue to be challenged by the sheer scale of this devastating storm, requiring further investment to make certain these needs are met,” said HUD Secretary Shaun Donovan, who chaired President Obama’s Hurricane Sandy Rebuilding Task Force. “These resources are making a difference helping individuals, families, and businesses to get back on their feet and come back stronger and more resilient than ever.”

HUD allocates CDBG-Disaster Recovery funds based on the best available data from the Federal Emergency Management Agency (FEMA), the Small Business Administration disaster loan programs, the Department of Transportation, and the Army Corps of Engineers to identify the areas of greatest need in the region impacted by Hurricane Sandy. These allocations will be published in the Federal Register in the coming weeks along with criteria for their use.

In this second Sandy allocation, grantees will be required to identify unmet needs for housing, economic development and infrastructure and may use this allocation to address those unmet needs. Grantees will be required to incorporate a risk assessment in their planning efforts to ensure long term resilience.

Each grantee must update its impacts and needs assessments and conduct a comprehensive risk assessment in order to inform infrastructure investments. The risk assessment must:

  • Include climate change impacts;
  • Account for changes in development patterns and populations;
  • Address how CDBG-DR funds will address those impacts and changes and associated risks; and identify how other federally funded infrastructure projects that have been secured as part the grantee’s recovery effort will address those risks and complement the proposed projects.
  • Use information and data provided by the Federal Government, including “Regional Climate Trends and Scenarios for the U.S National Climate Assessment. Part 1. Climate of the Northeast U.S.” and the “Sea Level Rise Tool for Sandy Recovery”, or comparable peer-reviewed information.
  • Identify and incorporate resilience performance standards, including other relevant guidance and standards identified in the Hurricane Sandy Rebuilding Strategy.

There will be additional requirements for major infrastructure projects benefitting multiple counties or having a total cost of at least $50 million including a CDBG-DR investment of at least $10 million, including:

  • Identifying projects in their Action Plan,
  • Demonstrating that the project was selected through regional collaboration; and,
  • Evaluating covered infrastructure projects using the collaborative risk analysis developed through the Rebuild by Design Competition.

Obligations or expenditures for infrastructure projects will only be approved once the grantee’s comprehensive risk assessment has been completed and it has demonstrated, to the satisfaction of the Secretary, that the selection and design of the proposed project or projects is consistent with, and supported by, the assessment. Following the grantee’s submission of an action plan describing how funds will be used, HUD will conduct an expedited review to enable funds to be accessed as quickly as possible. HUD has worked closely with state and local partners throughout this process to facilitate action plans being approved as soon as possible.

HUD, OMB and the Recovery Accountability and Transparency Board, which was established by the American Recovery and Reinvestment Act, will provide oversight to prevent and identify waste, fraud and abuse. In addition, the Hurricane Sandy Rebuilding Task Force, established by President Obama to coordinate the federal government’s efforts to support local rebuilding, has gone further by establishing a Project Management Office to monitor spending and progress to ensure the money is used as intended.

Read more about the Federal Government’s response to Hurricane Sandy.

###

HUD’s mission is to create strong, sustainable, inclusive communities and quality
affordable homes for all. HUD is working to strengthen the housing market to
bolster the economy and protect consumers; meet the need for quality affordable
rental homes: utilize housing as a platform for improving quality of life; build
inclusive and sustainable communities free from discrimination; and transform
the way HUD does business. More information about HUD and its programs is
available on the Internet at www.hud.gov and http://espanol.hud.gov.
You can also follow HUD on twitter @HUDnews, on facebook at
www.facebook.com/HUD, or sign up for news alerts on HUD’s News Listserv.

To view the online update, please click here.

 

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

HUD 2013 Contingency Plan for Possible Lapse in Appropriations

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On September 27, the U.S. Department of Housing and Urban Development (HUD) released a guide titled HUD FY2013 Contingency Plan for Possible Lapse in Appropriations.

Link to guide:
HUD FY2013 Contingency Plan for Possible Lapse in Appropriations

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

GSEs Update Servicing Policies

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On October 11, Mortgage Daily published an article titled GSEs Update Servicing Policies.

GSEs Update Servicing Policies
Policies aligned with mortgage servicing rules

Fannie Mae and Freddie Mac are updating their policies on delinquency management and default prevention in response to a servicing rule issued earlier this month.

Finals rules implementing mortgage servicing provisions of the Real Estate Settlement Procedures Act and the Truth in Lending Act were issued earlier this year by the Consumer Financial Protection Bureau.

The final Mortgage Servicing Rule was the result of amendments to RESPA and TILA by the Dodd Frank Wall Street Reform and Consumer Protection Act of 2010.

In Servicing Guide Announcement SVC-2013-20, Fannie outlined new policies that apply to loans in its portfolio, that it acquired and securitized or that it acquired in exchange for mortgage-backed securities.

Fannie said it is eliminating all the requirements for escalated cases in its servicing guide.

Fannie outlined the information that servicers must provide borrowers when they make inquiries to determine the owner or assignee of their loans. Requirements vary depending on whether or not Fannie holds the loans in its portfolio.

Servicers need to develop approaches to delinquent borrower management that provides continuity of contact through one person, according to Fannie.

Servicers of adjustable-rate mortgages are bound by notification time frames and must abide by the Payment Change Notification Guidelines for all payment changes.

When Fannie borrowers are 31 days past due, servicers must mail Form 731 between 31 and 35 days of delinquency, regardless of the result of a Behavioral Model Tool if one is used. Form 761 must be sent to borrowers who are 61 days delinquent within 61 and 65 days of delinquency.

Verbal acknowledgements of the borrower response package are no longer allowed, and servicers need to provide written acknowledgements within five business days of receipt, Fannie said. An incomplete information notice can be combined with the acknowledgement if the borrower’s package is missing items.

Fannie noted that evaluation notices must include a denial reason when a loan modification trial period plan isn’t offered and let the borrower know about the right to appeal within 14 days of the evaluation notice if a foreclosure is scheduled within 90 days. Servicers must develop appeals processes, and an employee not involved with the initial evaluation must review the appeal within 30 days. Appeals received after 14 days can be treated as a new borrower response package. If the servicer determines that a borrower who appealed is eligible for a modification, the borrower has 14 calendar days to accept an offer.

More details about the appeal process are outlined in Fannie’s letter, as are forbearance requirements, foreclosure reviews and delays in legal action.

In Bulletin No. 2013-21, Freddie outlined servicing requirements on primary residences, including the required appeals process.

Freddie said it issued new and updated servicing requirements on foreclosure referrals and new foreclosure suspension obligations.

Freddie also discussed new requirements applicable on all loans.

Changes at both companies become effective on Jan. 10, 2014.

Fannie Mae Servicing Guide Announcement SVC-2013-20

Freddie Mac Bulletin NO. 2013-21
 
To view the online article, please click here.
                                                                                                                                                              

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

Freddie Mac Releases Checklists to Simplify Transfer Process for Servicers

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On October 22, Freddie Mac released an update titled Servicing Transfer Checklists Simplify Transfer Process for Servicers.

Servicing Transfer Checklists Simplify Transfer Process for Servicers

Freddie Mac has introduced a comprehensive set of checklists to help guide you through the portfolio transfer process. The Servicing Portfolio Transfer Checklists provide start-to-finish instructions for setup and integration for newly acquired portfolios. You may have received these checklists in the past–which were previously referred to as “Servicer Setup Checklists”–to assist with your immediate needs. However, we have renamed the checklists, which include:

  • Servicing Portfolio Transfer Checklist: Transfer of Mortgage Servicing Rights
  • Servicing Portfolio Transfer Checklist: Interim Servicing
  • Servicing Portfolio Transfer Checklist: Subservicing

Servicing Portfolio Transfer Checklists provide comprehensive support
When acquiring a servicing portfolio, either through purchase, placement by Freddie Mac for interim servicing, or subservicing, you must link your organization with that new portfolio using various Freddie Mac applications and processes. Access these helpful checklists under the Key Resources for Servicers section on the Service Loans web page. The Servicing Portfolio Transfer Checklists:

  • Provide a complete set of instructions and contact information in one central location
  • Offer guidance on obtaining connectivity and setup for newly acquired portfolios
  • Improve Servicer productivity through easy access to our servicing-related suite of technology tools so that you can service your new portfolio

Please contact your Freddie Mac servicing representative or 800-FREDDIE if you have any questions about these checklists.

To view the online update, please click here.

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

Freddie Mac Operations Not Impacted by Government Shutdown

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On October 1, Freddie Mac announced that the federal government shutdown does not impact Freddie Mac operations.

Federal Government Shutdown Does Not Impact Freddie Mac Operations

Freddie Mac will continue normal operations without interruption during the temporary federal government shutdown. Freddie Mac systems and business functions will be open as usual for all selling and servicing functions.

While Freddie Mac currently is in conservatorship and regulated by the Federal Housing Finance Agency, we are not a government agency and not funded through the Congressional appropriations process so a government shutdown will have no direct impact on us.

You may have borrowers who are impacted by the government shutdown and if so, they will be eligible for all our relief options stated in the Freddie Mac Single-Family Seller/Servicer Guide (Guide).

If a loan is made to a government employee and the closing date is during the shutdown period, you do not need to obtain employment verification or re-verification prior to closing if a government office providing the verification is not able to do so as a result of the temporary shutdown. You are also not required to obtain employment verification or re-verification for such loans after the shutdown ends. This exception does not apply to income verification or any other requirements. We ask that you continue to be diligent in your underwriting practices as you remain bound by the representations and warranties as stated in the Guide.  

If you have concerns about needing an executed IRS Form 4506-T, Request for Transcript of Tax Return, please note the following guidance:

  • We only require IRS Form 4506-T to be signed by the borrower prior to closing. We do not require that 4506-T be processed by IRS prior to closing. However, we require that the actual 4506-T information is obtained as part of the Seller’s in-house QC program.
  • We require Servicers to have the Form 4506-T or 4506T-EZ, as applicable, processed by the IRS prior to evaluating a borrower for the Home Affordable Modification Program (HAMP), a standard modification or other workout option if processing of these forms is required. In the event the Servicer is unable to obtain tax transcripts from the IRS through electronic processing of an executed Form 4506-T or 4506T-EZ, Servicers must obtain a copy of the tax return from the borrower, if required.

Servicers of Federal Housing Administration (FHA), Department of Veterans Affairs (VA), and Rural Housing Service (RHS) mortgages should look to the requirements issued by those government agencies during the temporary shutdown.

We will inform you immediately if there are changes to our business operations as a result of the temporary federal government shutdown.

Please click here to visit Freddie Mac Single-Family News Center.

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

Freddie Mac IAM To Be Retired November 15

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On October 28, Freddie Mac announced the Investor Accounting ManagerSM (IAM) will be retired on November 15.

Effective 5 p.m. ET on November 15, 2013, Investor Accounting ManagerSM (IAM) will be retired. For all future reporting cycles, Servicers will be required to use the Freddie Mac Service Loans application. This change was first announced in Single-Family Seller/Servicer Guide (Guide) Bulletin 2013-10.

Using the Service Loans application for your investor reporting needs.

The Service Loans application provides a central source for your investor accounting reporting needs. All investor reports are available in the application, which is user friendly and offers improved downloading options and simpler, more intuitive formats than IAM.

We’ve also updated the application to enable you to:

  • Search by multiple loan numbers simultaneously using the View Custom Report tab
  • View and download the Loan Modifications Processed Report, previously
    provided through email
  • Download the LLR Edits To Be Cleared Details and LLR System Cleared Edits Details reports into PDF, comma separated value (.csv), or Excel formats. These new reports replace the hyperlink function for the Edits to Be Cleared and System Cleared Edits reports used in IAM.
  • To learn about edit codes:
      – Click the Help button from the View Outbound Reports tab
      – Select Resolving Loan-Level Edits Quick Reference Guide and search for
    the appropriate edit code

Investor reporting training is available

Visit Freddie Mac’s Learning Center for more information about the Service Loans applications and/or investor accounting reporting.

Register for the Service Loans application

  • Visit the Service Loans Application Resource Center for instructions on how to register for Service Loans application.
  • Choose one of the users roles that provide access to the Reports Tab. To only retrieve, view and print reports, enroll users as “Read Only Analyst” in the Service Loans application.

For more information

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

FNMA Update to File Transfer Portal Version 3.0 Release Notes

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On October 3, Fannie Mae released an update to a previous announcement titled File Transfer Portal Version 3.0 Release Notes.

File Transfer Portal Version 3.0 Release Notes

This release, previously scheduled for September 28, 2013, is now scheduled for the weekend of October 26, 2013.

During the weekend of September 28, 2013, Fannie Mae will implement File Transfer Portal Release 3.0.

File Transfer Portal (FTP) application helps to quickly move data between external entities and Fannie Mae applications. No release of this application has occurred since 2010 and no new business functionality will be included with this release. The purpose of this release is to deliver technical enhancements that will improve the software platform with the latest supported software versions/releases.

To view the update in its entirety, please click here.

About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.

FNMA SVC-2013-22 Miscellaneous Servicing Policy Changes

Posted on by Safeguard

On October 30, Fannie Mae released Servicing Guide Announcement SVC-2013-22, subtitled Miscellaneous Servicing Policy Changes.

Servicing Guide Announcement SVC-2013-22
Miscellaneous Servicing Policy Changes

This Announcement describes servicing policy changes and updates for the following:

  • Blanket or master insurance policy coverage of multiple unaffiliated projects
  • Payment of principal forbearance for mortgage loan modifications
  • Updates to property inspection reimbursements and requirements
  • Acknowledgment of escalated cases
  • Maintaining lender eligibility

Unless otherwise stated, all policy changes are effective immediately.

Blanket or Master Insurance Policy Coverage of Multiple Unaffiliated Projects

Servicing Guide Announcement SVC-2011-23: Condominium Insurance Requirements; Servicing Guide, Part II, Section 205: Coverage Required for Units in Condo Projects

On December 28, 2011, Fannie Mae published Announcement SVC-2011-23: Condominium Insurance Requirements, which established requirements for blanket or master insurance policies that cover multiple unaffiliated condo associations or projects. Fannie Mae is updating its Servicing Guide to prohibit the use of master or blanket insurance policies that cover multiple unaffiliated projects.

Servicers are required to work with the impacted borrowers to attempt to implement these new requirements for insurance policy renewals on or after February 1, 2014 for existing properties. If a homeowners’ association does not comply with these updated insurance coverage requirements, the units in the project will not be eligible to secure new loans to Fannie Mae.

Payment of Principal Forbearance for Mortgage Loan Modifications

Servicing Guide, Part VII, Section 602.02.05: Conventional Mortgage Loan Modification Terms; Announcement SVC-2013-16, Updates to Assistance in Disasters; Announcement SVC-2013-05, Streamlined Modifications, Conventional Mortgage Loan Modifications, and Outbound Communications

Currently the policy for Fannie Mae standard modifications, Streamlined Modifications, and mortgage loan modifications for mortgage loans affected by a disaster (for example, Streamlined Modifications Post Disaster Forbearance and Cap and Extend Modifications for Disaster Relief) requires that principal forbearance (also known as deferred principal) is payable upon maturity of the mortgage loan modification, sale or transfer of the property, or refinance.

Fannie Mae is updating this policy to require that principal forbearance is payable upon the earliest of the maturity of the mortgage loan modification, sale or transfer of the property, refinance of the mortgage loan, or payoff of the interest-bearing unpaid principal balance.

Please click here to view the announcement in its entirety.


About Safeguard 
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders,  and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.