Page 442 – Safeguard Properties

OCC Releases Guide Other Real Estate Owned

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

On September 13, the Office of the Comptroller of the Currency (OCC) released Bulletin OCC 2013-20, announcing it had issued the “Other Real Estate Owned” booklet of the Comptroller’s Handbook.

Description: Comptroller’s Handbook Revisions and Rescissions

The Office of the Comptroller of the Currency (OCC) issued today the “Other Real Estate Owned” booklet of the Comptroller’s Handbook. This updated booklet replaces a similarly titled booklet issued in March 1990 (and examination procedures issued in April 1998). The updated booklet also replaces section 251, “Real Estate Owned and Repossessed Assets,” issued in December 2010 as part of the Office of Thrift Supervision (OTS) Examination Handbook for the examination of federal savings associations.

The OCC’s “Other Real Estate Owned” booklet provides updated guidance to examiners and bankers on the acquisition, reporting, management, and disposition of OREO. Major revisions address interagency appraisal and evaluation guidance; managing and renting foreclosed residential properties; third-party service providers; borrower redemption periods after foreclosure; and the exchange of participation interests in OREO.

The booklet discusses similarities and differences in the statutes and regulations unique to national banks and federal savings associations (FSA). Although policies governing OREO for national banks and FSAs are similar in many respects, some differences remain and are addressed in the booklet. In addition, areas governed by policy but not statute or regulation have been made uniform for national banks and FSAs in this booklet. For example, whereas section 251 described OREO hold or sell considerations that an FSA should address, the updated booklet directs FSAs to the general statutory and regulatory standard for national banks for OREO disposition. In another example, FSAs had been expected to use property acquired for future expansion within three years of acquisition or transfer the property to OREO, whereas national banks are expected to use such property within five years; FSAs now are allowed the five-year time frame.

With the issuance of this booklet, the following documents are rescinded:

TS Examination Handbook, section 251, “Real Estate Owned and Repossessed Assets” (December 2010)
OCC Bulletin 2011-49, “Foreclosed Properties: Guidance on Potential Issues With Foreclosed Residential Properties” (December 14, 2011)
OCC Bulletin 2011-10, “Other Real Estate Owned: Exchanging Other Real Estate Owned for Other Assets” (March 24, 2011)

For further information, contact Grant Wilson, Director for Commercial Credit Risk, Credit and Market Risk Division, at (202) 649-6432.

John C. Lyons Jr.
Senior Deputy Comptroller and Chief National Bank Examiner

NY Issues New Force-Placed Insurance Rules

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

On September 19, National Mortgage News published an article titled New York Issues New Force-Placed Insurance Rules.

New York Issues New Force-Placed Insurance Rules

The New York State Department of Financial Services has proposed new regulations further extending the settlements it made with several of issuers of force-placed insurance. It said these new regulations will help ensure that the terms of those settlements will apply to the industry moving ahead even if new insurers enter the market.

Benjamin M. Lawsky, Superintendent of Financial Services said, “Our investigation uncovered a kickback culture in this industry that inflated premiums and did serious damage to struggling homeowners. These new rules will help ensure that homeowners remain protected and force-placed insurers don’t simply slide back to the bad old practices of the past.”

Among other conditions, the new rules will prohibit force-placed insurers from issuing a policy on mortgaged property serviced by a bank or servicer affiliated with the insurers.

They cannot pay commission to those entities nor reinsure policies affiliated with those entities.

And the rule would bar force-placed insurers from paying contingent commissions based on underwriting profitability or loss ratios.

DFS has reached settlements with Assurant, QBE and American Modern. Three other firms agreed with Lawsky’s office to abide by a code of conduct.

To view the online article, please click here.

MHA Updated Dictionaries Now Posted

Posted on September 13, 2018 by Safeguard

On September 26, Making Home Affordable (MHA) released a notice advising its updated data dictionaries are available.

Updated Data Dictionaries Now Posted
Today, September 26, 2013, the following updated versions of the Data Dictionaries were posted on HMPadmin.com in connection with the November 25, 2013 release:

HAMP Data Dictionary – 11/25/13 Release

Treasury FHA-HAMP Data Dictionary – 11/25/13 Release

2MP Data Dictionary – 11/25/13 Release

RD-HAMP Data Dictionary – 11/25/13 Release

Servicers are encouraged to review the change logs for specific update information. View these data dictionaries under each corresponding program page on HMPadmin.com.

To view the online update, please click here.

MHA SD 13-07: Servicer Handbook Version 4.3

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

On September 16, the Making Home Affordable Program (MHA) released Supplemental Directive 13-07: Making Home Affordable Program – Handbook for Servicers Version 4.3.

Supplemental Directive 13-07: Making Home Affordable Program – Handbook for Servicers Version 4.3

As of today, September 16, 2013, servicers can download Version 4.3 of the Making Home Affordable Program Handbook for Servicers of Non-GSE Mortgages (Handbook) from HMPadmin.com. The Handbook is a consolidated reference outlining the requirements and guidelines of the Making Home Affordable Program for mortgage loans that are not guaranteed by Fannie Mae or Freddie Mac.

Unlike Supplemental Directives (SDs), which outline specific policy topics only, the Handbook is organized so servicers can easily find program information in one convenient guide.

Version 4.3 of the Handbook incorporates and supersedes in their entirety 13-01, 13-02, 13-03, 13-04, 13-05 and 13-06.

See SD 13-07: Making Home Affordable Program – Handbook for Servicers Version 4.3 for more information regarding these updates.

To view the online release, please click here.

MBA Summary of CFPB Modifications to Servicing Provisions of Regulation X

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

On September 13, the Consumer Financial Protection Bureau (CFPB) issued a final rule amending and clarifying the Servicing, Ability to Repay/Qualified Mortgage, Loan Originator Compensation and Appraisal rules. In many areas, the CFPB responded to the Mortgage Bankers Association (MBA) comments seeking revisions that would facilitate compliance by the industry. Following is a summary released by the MBA on September 20, which addresses modifications to the servicing provisions of Regulation X.

Link to summary

Please click here for earlier reporting.

HUD ML 2013-32 Update to FHA Loss Mitigation Home Rentention

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

On September 20, the U.S. Department of Housing and Urban Development (HUD) published Mortgagee Letter 2013-32, subtitled Update to FHA’s Loss Mitigation Home Retention Options.

Mortgagee Letter 2013-32
To: All Approved Mortgagees

Subject: Update to FHA’s Loss Mitigation Home Retention Options

Purpose: This Mortgagee Letter supersedes Mortgagee Letter 2012-22, Revisions to
FHA’s Loss Mitigation Options, published on November 16, 2012. Also, this
Mortgagee Letter addresses treatment of “continuous income” 1 from sources
other than wages for mortgagors in need of loss mitigation assistance. This
Mortgagee Letter is intended to help reduce the number of full claims against
FHA’s Mutual Mortgage Insurance Fund by assisting a greater number of
distressed mortgagors in retaining their homes; thus, Mortgagee Letter 2012-22
will remain effect until servicers are able to fully implement this Mortgagee
Letter.

Effective Date: Mortgagees must implement the policies set forth in this Mortgagee
Letter no later than December 1, 2013.

Policy Updates: This Mortgagee Letter includes guidance on:

Defining “continuous income,” other than wages, for Loss Mitigation
evaluations;
Conditions required for a “Special Forbearance” to be used as a loss
mitigation tool;
Capitalization of arrearages for Modifications and Partial Claims;
Working with mortgagors in bankruptcy;
Defining “Market Rate” (introduced by Mortgagee Letter 2013-17); and
Frequently Asked Questions (FAQs), communicated in Attachment 1 of
Mortgagee Letter 2013-03.

Background on FHA’s Loss Mitigation Program: FHA’s Loss Mitigation Program
was established in 1996 to ensure that distressed FHA mortgagors were afforded
opportunities to retain their homes and to assist in minimizing losses to FHA’s
Mutual Mortgage Insurance Fund.

To view the online Mortgagee Letter, please click here.

HUD August Housing Scorecard

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

On September 13, the U.S. Department of Housing and Urban Development (HUD) released an update titled Obama Administration Releases August Housing Scorecard.

OBAMA ADMINISTRATION RELEASES AUGUST HOUSING SCORECARD
Administration’s efforts to speed the housing recovery continue to show progress in latest housing data

WASHINGTON- The U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of the Treasury today released the August edition of the Obama Administration’s Housing Scorecard – a comprehensive report on the nation’s housing market. The latest data show important progress across many key indicators–as home prices, purchases of new homes, and sales of existing homes continue to show strong annual gains–although officials caution that the overall recovery remains fragile. The full Housing Scorecard is available online at www.hud.gov/scorecard.

“As indicated in the August housing scorecard, the Administration continues to work to stabilize the housing market and help responsible homeowners get back on their feet,” said HUD Deputy Assistant Secretary for Economic Affairs Kurt Usowski. “With the number of underwater homeowners decreasing by more than 40%, it is clear that we are moving in the right direction. As we regain stability in our housing markets, it is important to remember that we still have a long way to go in making sure that our housing finance system is strong for future generations.”

“The standards set by the Making Home Affordable Program have changed the mortgage servicing industry, as have our quarterly assessments of servicer performance” said Treasury Assistant Secretary for Financial Stability Tim Massad. “While there has been significant progress, there is still more improvement needed in servicer behavior. And while the housing market has recovered substantially, there are still homeowners struggling to avoid foreclosure and it is vital that we continue to try to help them.”

Since inception of the Making Home Affordable Program, Treasury has required participating servicers to take specific actions to improve their processes through ongoing program reviews. The quarterly Servicer Assessments summarize performance in three categories of program implementation: identifying and contacting homeowners; homeowner evaluation and assistance; and program reporting, management and governance. Results for the second quarter of 2013 show that, although servicer performance can fluctuate from quarter to quarter, in general, servicers are demonstrating sustained performance in program implementation. While servicer’s execution of MHA has improved over time, there are still areas where servicer performance requires improvement, and Treasury will continue to apply pressure on the mortgage servicing industry to sustain these improvements.

Mortgage servicers continue to appropriately calculate homeowner income, which is used to determine a homeowner’s eligibility and modified payment amount under the program. In Q2 2013, the majority of servicers have income calculation error rates below the benchmark established by Treasury (with two servicers at zero percent error rates).
Servicers continue to effectively evaluate homeowners under program eligibility criteria as evidenced in the “second look disagree” category, which reflects the rate at which Treasury’s program reviews disagree with the servicer’s decision not to assist a homeowner. In Q2 2013, the average second look disagree percentage for the top servicers was less than 2 percent, less than half of Treasury’s established benchmark.

All servicers will need to continue to demonstrate progress in any areas identified in subsequent program reviews. Servicers have been directed to enhance their execution in key areas that include timely solicitation of homeowners for participation in MHA; timely, accurate and detailed communications with homeowners; and ensuring the integrity and proper use of the Net Present Value (NPV) model during the evaluation process.

The August Housing Scorecard features key data on the health of the housing market and the impact of the Administration’s foreclosure prevention programs, including:

Home prices continued to show strong annual gains. As of June 2013, the FHFA purchase-only index rose 7.7 percent from last year, and was up on a seasonally adjusted basis by 0.7 percent from May. The FHFA seasonally adjusted purchase-only index for the U.S. has increased for the last 17 consecutive months. The S&P/Case-Shiller 20-City Home Price Index posted returns of 2.2% for June (not seasonally adjusted) and 12.1% over the past 12 months.
Millions of underwater homeowners are getting relief due to improvements in home prices. The number of underwater homeowners has fallen by 42% since the beginning of 2012 – from 12.1 million to 7.1 million as of the second quarter of 2013 – lifting 5.0 million homeowners who owed more on their mortgages than they were worth above water. In the first half of 2013, nearly 3.5 million homeowners have returned to positive equity. CoreLogic credits the decrease in underwater borrowers largely to the improvement in home prices.
The Administration’s foreclosure mitigation programs continue to provide relief for millions of homeowners as the recovery from the housing crisis continues. Over 1.7 million homeowner assistance actions have taken place through the Making Home Affordable Program, including more than 1.2 million permanent modifications through the Home Affordable Modification Program (HAMP), while the Federal Housing Administration (FHA) has offered more than 1.9 million loss mitigation and early delinquency interventions. The Administration’s programs continue to encourage improved standards and processes in the industry, with HOPE Now lenders offering families and individuals more than 3.7 million proprietary modifications through June.
The Neighborhood Stabilization Program continues to help communities across all 50 states to address foreclosed and abandoned homes. During the Second Quarter of 2013, grantees report cumulative completions of newly constructed or rehabilitated housing units under NSP topping 25,000 units, while direct assistance to homeowners reached the 10,000 mark, signaling strong progress toward achieving projected activity under the NSP1, NSP2, and NSP3 programs.
Homeowners in HAMP continue to benefit from meaningful payment relief, increasing their long-term likelihood of avoiding foreclosure. As of July, more than 1.2 million homeowners have received a permanent modification through HAMP, saving approximately $547 on their mortgage payments each month–a 39 percent savings from their previous payment–saving a total estimated $21.6 billion in monthly mortgage payments. In July, 73 percent of eligible non-GSE mortgages benefitted from principal reduction with their HAMP modification. Homeowners currently in HAMP permanent modifications with some form of principal reduction have been granted an estimated $11.1 billion in principal reduction.

View the Making Home Affordable Program Report with data through July 2013.

###

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.

HUD Announces Disaster Assistance for Colorado Storm Victims

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

On September 16, the U.S. Department of Housing and Urban Development (HUD) released a notice titled HUD Secretary Announces Disaster Assistance for Colorado Storm Victims.

HUD SECRETARY ANNOUNCES DISASTER ASSISTANCE FOR COLORADO STORM VICTIMS
Foreclosure protection offered to displaced families

WASHINGTON – U.S. Housing and Urban Development Secretary Shaun Donovan today announced HUD will speed federal disaster assistance to the State of Colorado and provide support to homeowners and low-income renters forced from their homes due to severe storms, flooding, landslides and mudslides.

Last week, President Obama issued a disaster declaration for Adams, Boulder, Larimer and Weld Counties. The President’s declaration allows HUD to offer foreclosure relief and other assistance to certain families living in these counties.

“Families who may have been forced from their homes need to know that help is available to begin the rebuilding process,” said Donovan. “Whether it’s foreclosure relief for FHA-insured families or helping these counties to recover, HUD stands ready to help in any way we can.”

HUD is:

Offering the State of Colorado the ability to re-allocate existing federal resources toward disaster relief – HUD’s Community Development Block Grant (CDBG) and HOME programs give the State and communities the flexibility to redirect millions of dollars to address critical needs, including housing and services for disaster victims. HUD is currently contacting State and local officials to explore streamlining the Department’s CDBG and HOME programs in order to expedite the repair and replacement of damaged housing;
Granting immediate foreclosure relief – HUD granted a 90-day moratorium on foreclosures and forbearance on foreclosures of Federal Housing Administration (FHA)-insured home mortgages;
Making mortgage insurance available – HUD’s Section 203(h) program provides FHA insurance to disaster victims who have lost their homes and are facing the daunting task of rebuilding or buying another home. Borrowers from participating FHA-approved lenders are eligible for 100 percent financing, including closing costs;
Making insurance available for both mortgages and home rehabilitation – HUD’s Section 203(k) loan program enables those who have lost their homes to finance the purchase or refinance of a house along with its repair through a single mortgage. It also allows homeowners who have damaged houses to finance the rehabilitation of their existing single-family home; and
Offering Section 108 loan guarantee assistance – HUD will offer state and local governments federally guaranteed loans for housing rehabilitation, economic development and repair of public infrastructure.
Information on housing providers and HUD programs – The Department will share information with FEMA and the State on housing providers that may have available units in the impacted counties. This includes Public Housing Agencies and Multi-Family owners. The Department will also connect FEMA and the State to subject matter experts to provide information on HUD programs and providers.

Read about these and other HUD programs designed to assist disaster victims.

###

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 Mailing List.

To view the online notice, please click here.

Freddie Mac Immediately Extends Mortgage Relief to Colorado

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

On September 17, Freddie Mac issued an announcement titled Freddie Mac Immediately Extends Mortgage Relief to Colorado Borrowers Affected by Floods.

Freddie Mac Immediately Extends Mortgage Relief to Colorado Borrowers Affected by Floods

MCLEAN, VA–(Marketwired – Sep 17, 2013) – Freddie Mac’s (OTCQB: FMCC) full menu of mortgage relief policies for borrowers affected by disaster is being extended to homeowners whose homes were damaged or destroyed by the devastating floods in Colorado. Freddie Mac’s disaster relief policies enable servicers to help borrowers with homes in presidentially declared Major Disaster Areas where federal Individual Assistance programs are being made available. Freddie Mac is one of the nation’s largest investors in residential mortgages.

News Quote:
Attribute to Tracy Mooney, Senior Vice President of Single-Family Servicing and REO at Freddie Mac:

“Freddie Mac is urgently reminding the nation’s mortgage servicers about the full range of mortgage relief options they can provide to affected borrowers with mortgages we own or guarantee, including forbearance on mortgage payments for up to one year. We strongly encourage borrowers to contact their servicers, who are fully authorized to work with them on a case-by-case basis.”

News Facts:

Freddie Mac disaster relief policies authorize mortgage servicers to help affected borrowers in presidentially declared Major Disaster Areas where federal Individual Assistance programs have been extended. A list of these areas can be found at http://www.fema.gov/disasters.
Freddie Mac mortgage relief options for affected borrowers in these areas include:
- Place borrowers on forbearance and suspend foreclosures for up to 12 months;
- Waiving assessments of late fees against borrowers with disaster-damaged homes;
- Not reporting forbearance triggered by the disaster to the nation’s credit bureaus; and
- Suspending eviction lock-outs for up to 90 days.
Under a new Freddie Mac mortgage modification option, after the disaster forbearance ends, the servicer can add skipped payments to the outstanding loan balance and extend the mortgage term, while keeping the borrower’s mortgage payment essentially the same.
Freddie Mac is also reminding servicers to consider Freddie Mac’s standard relief policies, including forbearance or mortgage modifications, for borrowers who work in eligible disaster areas but live in unaffected areas.
Affected borrowers should immediately contact their mortgage servicer — the company to which they send their monthly mortgage payment.
See freddiemac.com/singlefamily/service/disastermgmt.html for a description of Freddie Mac disaster relief policies.

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation’s residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four home borrowers and is one of the largest sources of financing for multifamily housing. www.FreddieMac.com. Twitter: @FreddieMac

To view the online announcement, please click here.

Freddie Mac EVP Dave Lowman Sends a Message

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

On September 23, Freddie Mac released a message from EVP of Single-Family Business, Dave Lowman.

A Message From Dave Lowman, Executive Vice President, Single-Family Business

I want you – as a Freddie Mac customer – to have confidence in our commitment to give
you the high-quality service you expect, the day-to-day support you need, and the respect
our valued business partners deserve.

In the almost five months I’ve been at Freddie Mac, I’ve had the opportunity to get out of Virginia and meet onsite with many of our customers. I’ve spoken with even more of you on the phone. And you’ve told me – very candidly – where we’re doing right by our customers and where we fall short. You’ve been just as direct in your conversations with other members of the Single-Family Business leadership team, and in your responses to our customer satisfaction surveys. Thank you for that.

The message? Freddie Mac is on the right track in a lot of areas, but we need to improve your customer experience. Specifically, you’ve told us we need to:

Make it easier to do business with us
Increase our customer focus
Achieve a more consistent understanding of your business within our leadership team, and engage with you more frequently
Communicate more clearly, especially about what you can expect from us
Continue to improve our technology

We’ve heard you. Just as you’ve had to change in recent years, Freddie Mac is changing, too – to be a better business partner with you today, as we work together to build a stronger, more efficient housing finance system for tomorrow.

We’ve already taken meaningful steps to address your concerns, including:

Dedicating ourselves to new Customer Service Level Standards aimed at strengthening our business relationship with you. These Standards define the level of customer service you should expect from us, and against which we’ll measure our performance.
Introducing tools, like Loan Quality Advisor, that are designed to provide you with clearer, more transparent information and greater purchase certainty.
Providing more comprehensive support through new and enhanced training opportunities and resources, such as webinars on integrating Loan Quality Advisor into your business practices and an overview of Loan Prospector enhancements.
Enhancing Loan Prospector user feedback to clearly align messages with our underwriting, documentation, and purchase eligibility requirements.
Updating Workout Prospector so Servicers can submit modification exceptions directly through the system – rather than emailing forms – and immediately view results and status online.
Providing greater transparency and improved response times by delivering email updates as needed throughout the day on technology system issues or outages.
Launching “Freddie Mac Update Calls” to help you understand the changes to our requirements, new tools and technologies, and other key process and operational changes we’re making.
Piloting a new Customer Business Profile report that gives Sellers a more comprehensive view of your business with us.
Leveraging our Customer Advisory Boards so that your voice is heard as we introduce changes to the market.
Hosting senior leadership calls so our leadership teams hear directly from our customers.
Redesigning our Quality Assurance review process for Servicers and publishing a review calendar.

These are tangible steps that represent the first installment in what will be a series of changes over the coming months as we work to deliver the best possible customer service. Among the improvements we’ll be rolling out:

Monthly reports sharing our progress in meeting the new Customer Service Level Standards.
New technology to provide Sellers transparency into the status of loans requested by Quality Control, including loan findings and repurchase data.
Revised short sale processes that reduce approval times.
Broadening our Customer Business Profile pilot to all Sellers.
Continued enhancements that provide better clarity and transparency in Loan Prospector’s feedback messaging.
Streamlined foreclosure bidding process and enhanced technology tools through Service Loans Application.

Here’s the bottom line: we want to be your first choice when it comes to doing business in the secondary mortgage market, and we’re working hard to earn your business today and to continue earning it tomorrow. Some of you have told us you’re already seeing a difference, and that’s gratifying. But we won’t be satisfied until all of our customers are experiencing a better, more responsive Freddie Mac.

Please know that our entire team is behind you, and as head of the Single-Family Business, I’m holding myself and every employee accountable for results. Meanwhile, I welcome your feedback on any of the changes we’re making.

Thank you for your business. I look forward to strengthening our relationship as we continue to improve our service to you.

Sincerely,

Dave Lowman
Executive Vice President, Single-Family Business
Freddie Mac

Please click here to view the online message.