Agenda • U.S. Bank Home Mortgage • Lender Approval • Delivery and Funding • Top Exceptions • Purchase Process • Help Desk and Lender Reference • Customer Service and Loss Mitigation • Underwriting Highlights and Resources • Q & A
U.S. Bank Home Mortgage “MasterServicer” Review, purchase, securitize, and service mortgage loans from all participating lenders who are approved to originate in the program. Loans must meet HOC compliance requirements, as well as specific loan product (FHA) underwriting guidelines.
All loans Serviced at our location are originated through State and Local HFA Programs The ONLY MRB Master Servicer with a Facility SOLELY DEDICATED to the Acquisition and Servicing of MRB Loans Dedicated Facility and Team of Individuals Working with Housing Authorities is our Business 2
Our MRB Nationwide Footprint NEW HAMPSIRE VERMONT WASHINGTON MONTANA MRBP DIVISION NORTHDAKOTA MAINE MINNESOTA OREGON MA SOUTH DAKOTA WISCONSIN IDAHO NEWYORK WYOMING MICHIGAN RI PENNSYLVANIA CT IOWA NJ NEBRASKA NEVADA OHIO INDIANA UTAH ILLINOIS DE W.VA COLORADO MD VIRGINIA KANSAS MISSOURI KENTUCKY CALIFORNIA NORTH CAROLINA TENNESSEE OKLAHOMA • ARKANSAS OKLAHOMA SOUTH CAROLINA ARIZONA NEW MEXICO MISSISSIPPI ALABAMA GEORGIA TEXAS LOUISIANA FLORIDA o 00000000000000000000000 FLORIDA
Lender Approval • All lenders MUST be approved by both U.S. Bank and HOC to participate in the program • The U.S. Bank MRBP lender application is sent out with the lender invitation package • The MRBP Lender Help Desk will be responsible for the approval of all lenders
Preparation • Advise borrower their loan is being sold to U.S. Bank Home Mortgage • Ship loan(s) to U.S. Bank as soon as possible, using appropriate loan delivery checklist -Verify all documents are included in delivered loan file -Verify that all documentation is completed & correctly executed prior to shipping
Delivery & Funding • Access information at: mrbp.usbank.com • Click on U.S. Bank lender manuals > to Allregs • Review Delivery and Funding Guidelines, Checklists, Forms, and any Updates • Share information with Originators, Closers & Shippers
Open Housing Finance Authority folder and select Maryland, Montgomery County
Delivery & FundingProgram Information • Example Checklist
U.S. Bank Bulletins Sample
Insurance Deductibles – Government Hazard / Flood Deductibles may not exceed the higher of $1,000 or 1 percent of the face amount of the policy. Association Policy requirements for CONDO/PUD Projects and common areas. U.S. Bank requires an HO-6 (walls-in) policy on all condo units. Windstorm / Hurricane The greater of $2,000 or 2% of the dwelling coverage. Provide proof via paid receipt for all policies to show one year advance payment. Include the dollar amount paid.
Reference Endorsements / Assignments “U.S. Bank National Association” (First Mortgages) Hazard Insurance / Loss Payee Clause: U.S. Bank National Association its successors and or assigns as their interest may appear. c/o U.S. Bank Home Mortgage P.O. Box 7298 Springfield, OH 45501-7298 Borrower Payment Address and Website: U.S. Bank Home Mortgage P.O. Box 468002 Bedford, OH 44146-8002 www.usbankhomemortgage.com MERS ID #: 1000212
Program Information • FHA loans only • Minimum FICO for all borrowers is 640 • Debt to income maximum of 45% • HOC Purchase Assistance will be funded by U.S. Bank at the same time the 1st mortgage loan is funded. One wire will be sent for both loans (when applicable) and all fees/compensation
Fees and Compensation • Fees • Loan Funding Fee - $150.00 • Tax Service Fee - $85.00 • Compensation • 1.5% SRP, based on principal balance of loan at time of funding
Loan File Delivery Address ALL Loan Files should be sent to: U.S. Bank Home Mortgage 17500 Rockside Road Bedford, OH 44146 Attn: Operations Department Loans will be reviewed within 3-5 business days of receipt
Loans With Exceptions • U.S. Bank will communicate all loan exceptions to a designated person via daily fax and weekly recap report • Exceptions can be emailed to firstname.lastname@example.org • Please provide separate cover letter/sheet for each loan exception and include U.S. Bank loan number • Once all outstanding deficiencies have been resolved and loan has been compliance approved, U.S. Bank will purchase the loan
Most Frequent Document Exceptions 1. Mortgage / Deed of Trust Missing riders Tax Exempt, Condo, PUD Riders if applicable Missing pages of the mortgage and/or legal description Notary section left blank or incorrectly completed Property address differs from other documentation 2. Note Missing original Endorsement incorrect: U.S. Bank National Association Incorrect payment terms. Must be = 360 Property address differs from other documents
Most Frequent Document Exceptions 3. Truth in Lending Initial T-I-L not in file Final T-I-L not in file Corrective final T-I-L, if applicable, not in file MI under-disclosed or not disclosed in the payment stream Reminder: new form required per Bulletin 2011-03 Refer to Bulletins 2009-40 and 2009-52 for further information regarding T-I-L requirements • Note: Lender is required to follow federal guidelines. If loan is not in compliance, it cannot be purchased by U.S. Bank.The file will be cancelled and returned.
Most Frequent Document Exceptions 4. HUD-I DAP assistance is not properly identified or has an amount that differs from other documents Missing signed copy of the final HUD-1 Evidence of tolerance violation in GFE fee comparison with no cure (see Bulletin 2009-89) Monthly escrows not collected 5. Good Faith Estimate Most recently issued in file does not match loan terms at closing (see Bulletin 2009-89) Missing from file
RESPA Reference: http://www.hud.gov/offices/hsg/rmra/res/respa_hm.cfm
Real Estate Settlement Procedures Act (RESPA) U.S. Bank’s File Review U.S. Bank Home Mortgage-MRBP staff performs a basic compliance review of the GFE document to ensure compliance with the following: • Ensure GFE is on proper form • Ensure HUD-1 is on proper form • Verify “Loan Terms” on HUD-1 match “Summary of Your Loan” on the last issued GFE. • Verify HUD-1 is within acceptable tolerances with last GFE issued including a review of charges that cannot increase by more than 10% • Verify lender provided acceptable cure documentation, if applicable Post Settlement Cure: HUD allow lenders a 30-day cure period from date of borrower’s signed closing documents for violating GFE/HUD-1 fee tolerances. Lenders exceeding fee tolerances will be in violation of Section 5 of RESPA. USBHM must receive proof of refund to borrower and a corrected HUD-1, from settlement agent prior to loan purchase. NOTE:If there is a known issue, don’t wait until USBHM has reviewed as you may exceed the 30-day cure period for correction.
Most Frequent Document Exceptions 6. Initial Loan Application Interviewer date missing Missing from file Date for timing of early T-I-L not documented properly (see Bulletins 2009-40 and 2009-52) 7. Hazard and Flood Policies Names and addresses do not match other documents exactly Flood coverage inadequate Deductibles greater than required Flood policy missing flood zone, or zone on flood policy does not match zone on flood certification Proof of payment not included in file
Most Frequent Document Exceptions 8. Manufactured Housing Documentation Requirements Evidence of title being surrendered to state not in file Model number/name missing from Security Agreement Endorsement 7.1 not added to title commitment Security Instrument missing information on manufactured home 9. Underwriting Documentation DU findings missing from file Underwriting Transmittal Summary missing or not signed Missing or inconsistent underwriting documentation for Conventional files
Most Frequent Document Exceptions 10. Assignment Missing from file Not assigned correctly to U.S. Bank National Association (Endorsement on note must match – see Bulletin 2010-46) Incorrect references to lender, borrower, and/or property information 11. FHA Connection FHA Connection is checked during the review process for certain information, and the following errors cause delays in funding: Incorrect closing date Incorrect ADP code No evidence that the UFMIP was sent to FHA
Loan Purchase Process • Loans are purchased once all closed loan file exceptions and compliance exceptions have been cleared and HOC has given final compliance approval to U.S. Bank • Loans will be funded at an amortized balance net of escrow funds (no checks) • Loans are purchased daily • Purchased loan summary / detail is faxed to lenders
E-Mail the Help Desk email@example.com Status of loans Status of documents received Loan Deficiencies / Exceptions Program guidelines General information Lender Help Desk • Help Desk Line: • 1-800-562-5165
Lender Scorecard • Quarterly analysis is completed based on loans received for purchase and their performance • Loans placed on exception, not cleared or purchased within required timeframes • YTD deficiencies, delinquency, foreclosure & bankruptcy statistics • Final recorded documents over 240 days outstanding • Lenders and HOC are advised in writing of any issues
Post-Purchase - Final Documents • Organize documents according to checklist • All lenders are responsible for delivery of documents to U.S. Bank • Due within 120 days from purchase by U.S. Bank • A late fee of $50 will be assessed after 120 days • Deliver to: Document Control 17500 Rockside Road Bedford, Ohio 44146-2099 Final Doc Supervisor Darlene Kreigh – firstname.lastname@example.org (216) 475-7739
Post-Close Trailing Doc Exceptions Title Policy: • Mortgage amount is missing • Schedule A, item 4 contains incorrect mortgage recording information • Name of insured is incomplete (needs to mirror mortgage and have “it’s successors and/or assigns”) • Missing required endorsements Second Mortgages: • Closing date is incomplete • Missing marital status of borrower(s) • Incorrect maturity date • Legal description missing • Tax Exempt Rider is recorded with Second Mortgage instead of theFirst Mortgage Assignments: • Missing all recordings of the mortgage
Customer Service U.S. Bank Commitment To Customer Service
Customer Service MRBP Servicing Location 17500 Rockside Road Bedford, OH 44146 All MRBP Bond loans serviced from this facility! Borrower Payment Address and website: U.S. Bank Home Mortgage P.O. Box 468002 Bedford, OH 44146-8002 www.usbankhomemortgage.com Customer Service Toll Free Number 800-240-7890 Hours: Monday – Friday 7:00 am – 8:00 pm EST www.usbankhomemortgage.com
Customer Service • Borrowers receive monthly billing statements • Spanish Speaking Customer Service & Default Representatives • Interactive Voice Response System (24 hours a day) • Mortgagor Website Access (24 / 7) www.usbankhomemortgage.com • Call Center Operations M-F (7:00am – 8:00pm est.) 800-240-7890 • Default Servicing Call Center Operations (8:00am – 8:00pm est.) • Flexible Payment Methods: ACH, Mail, Website, Phone
Home Retention – Maintain Home Ownership • U.S. Bank’s mission is to minimize the number of delinquent loans through customer contact, education and awareness. Early contact and counseling are keys to successful loss mitigation • Our goal is to offer any attempt to initiate a repayment plan or a loss mitigation workout option • Loans active in foreclosure are not eliminated from receiving assistance. All foreclosure loans are solicited for loss mitigation efforts until the foreclosure sale date
Home Retention – Maintain Home Ownership • U.S. Bank is dedicated to collectively working in both Default Counseling and Loss Mitigation towards keeping borrowers in their homes • U.S. Bank interviews borrowers obtaining their reason for default and providesoptions that are available to help. *Borrowers have the ability to establish repayment plansonline for their situation • DVD video “We’d like to help”, mailed to borrowers. Available in English/Spanish. Pamphlet also mailed to borrowers offering assistance
Underwriting Highlights • This presentation is for basic informational purposes only. It does not modify or replace the information provided by FHA. All loans should be underwritten in compliance with the most current underwriting guidelines for FHA • It is the lenders responsibility to follow all guidelines specific to the program as well as any U.S. Bank guidelines including mortgagee letters, announcements, or bulletins. This presentation is for general products requirements • U.S. Bank and HOC are not liable for loans not meeting product guideline criteria Please note – only DU or LP may be used. Other lender customized automated underwriting systems are not acceptable at this time
Underwriting Highlights • Credit Underwriting is the responsibility of the originating lender, U.S. Bank Home Mortgage (Master Servicer) will not re-underwrite loans • All loans are subject to both internal and agency audits • Underwriters should… • Make sound credit decisions • Assure data integrity • Include all necessary documents • Provide supporting documentation for the UW decision
Resources FHA Underwriting Guidelines • Guide – 4155.1 rev 5 • FHA websitewww.hud.gov • Allregswww.allregs.com • Searchanswers.hud.gov • Emailhud@custhelp.com • Phone Monday-Friday, 8 am to 8 pm ET • 1-800-CALLFHA (1-800-225-5342) • email@example.com
Q & A • Q: If borrower only has 1 credit score, do we use that one score, or non traditional credit? A: If any borrower has a credit score it must be used. If no credit score is available, follow non-traditional underwriting guidelines. • Q: Do all borrowers need to meet the 640 median FICO requirement? A: Yes, all borrowers must meet the FICO requirement. • Q: Are Section 8 Loans permitted? A: Yes Section 8 Loans are permitted, contact the U.S. Bank Help Desk for more information.
THANK YOU For your participation in the Housing Opportunities Commission program!