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MEMO
#1024: Convey Condition - 12/27/02
The single
most important question you will have to answer for work orders
on HUD/FHA properties "Is the property in convey condition?"
.
Once a
property has gone to sale, our clients have 30 days from the
sale date (if already vacant) or eviction date to convey the
property to HUD/FHA. If the 30 day deadline is not met, our
clients can incur daily financial penalties.
Our clients
and our goal is to ensure all properties convey to HUD/FHA
within that 30 day time frame. Our clients need approximately
10 days in house to perform all their internal procedures,
leaving Safeguard with a very short turnaround time to complete
the work required to report the property in convey condition
(ICC).
When we
place a CONVEY or CONVEY PER BID work order, it is imperative
that the work be completed timely. All bids must be submitted
immediately to allow time to get bid approval and the work
performed within the available time frame. Any delays will
place the loan out of compliance and create financial penalties
for our clients.
Following
is a checklist for you to review if all of the listed conditions
have been addressed when you report that the property is in
convey condition. Please review this checklist each time you
are reporting on a convey order.
Requirements
for a property to be considered In Convey Condition
A property
is ready to convey if the following requirements have been
met:
- The
mortgage company has clear title to the property. This is
usually accomplished as a result of the foreclosure sale
and is not within our control.
- The
property is not occupied. If the property is occupied after
the foreclosure sale, the mortgage company must go through
eviction proceedings.
- The
property is secure and has been secured following the guideline
requirements including lock codes.
- Outbuildings
are secure and have been secured following the guideline
requirements including lock codes.
- Boarding,
if required, has been completed and was completed following
the guideline requirements.
- Pools,
hot tubs, and/or spas are secure per the guideline requirements.
- The
property has been winterized per the guidelines.
- Utilities
have been transferred into the mortgagee's name, if required
by the guidelines. This requirement depends on heating system
type and regional variation.
- If
the property has a sump pump, the sump pump is functional
and electricity is on and transferred into the mortgage
company's name.
- Exterior
debris and health hazards have been removed from the property
per the guideline requirements.
- Interior
debris and health hazards have been removed from the property
if guidelines for that area call for removal.
- Personal
property has been removed from the property per the guideline
requirements.
- Grass
has been cut within two weeks of conveyance, if conveying
during grass cut season.
- The
property is free from any damage, other than that due to
mortgagor neglect/unfinished renovations, except for fire,
water, freeze, flood, earthquake, tornado, hurricane, boiler
explosion, vandalism, and roof damages.
- There
are no outstanding property condition code violations or
citations.
If any
of the above listed is not completed, the property is not
in convey condition. The only exception to these requirements
occurs if HUD has been advised of an issue where the requirements
have not been met and has agreed to accept the property as
is.
For additional
clarification please contact your regional coordinator.
Have a
safe, happy and prosperous New Year.
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