New Fannie, New Freddie Servicing Guide Amendments.

[davephx]

Both Fannie and Freddie Dated 11/2/09 and they are different !!

I am mainly interested in Fannie since they own me...or my mtg.

9 pages of revisions, mostly good some bad. At least someone is trying to keep up with real world problems.

Much of it I believe is the same as earlier directives by HampAdmin such as no longer needing the Trial Mod Agreement (the one I just got last week after 3 trails) etc.

Scanning it

The bad
Any forbearance can not exceed 100% of FMV - I am not sure but I think it use to be 125%. This kills forbearances if underwater. But not effective till 12/1/09 Something similar had been in prior HAMPAdmin directives.

On an initial NPV test after 12/1/09 now if the NPV result is $5000 or more negative the service MAY NOT do a mod WITHOUT EXPRESS WRITTEN CONSENT OF FANNIE. Sigh. It use to be they could at the servicer discretion as I recall.

The Good
As per prior HampAdmin the Trial Modification Agreement no longer required.

Retaining First Lien Position.
This is very important to me since I started this process in March and am now getting close to the $20,000 of back payments to roll into a hopefully mod.

It use to be if $20,000 or more had to get the 2nd to resubordinate which could have been a killer for me. Why would my not only underwater but half way to China underwater agree to subordinate?

Now a title endorsement or similar insurance product issued by a title company is required but not a re subordination agreement of lower liens...like 2nds.

At least I think this is better! I have no idea how or how much costs to get Title company endorsement and have no clue exactly what happens. But I think its better than getting the 2nd to subordinate.

It clarifies lots of things like Unemployment Insurrance have to prove have at least 9 months left of benefits, which depends on state etc. I think that also was in a HampAdmin directive.

Above was Fannie .. now to Freddie 11/2/09

Scanning it briefly - seems similar to Fannie except I note for forbarances there is NO "with approval" exception if NPV is $5000 or more negative. It is a straight decline (and can't be more than 30% which is same in Fannie)

Freddie but not Fannie talks about a new IMMINENT DEFAULT INDICATOR available soon. But no details.

Freddie is only 6 pages vs 9 pages for Fannie.

Fannie talks about verifying income non taxable income etc in detail which is not included in Freddie.

It is so confusing since those with the investor Fannie follow one set of rules, those owned by Freddie another and any other non GSE investors follow probably the HAMPAdmin rules. And then we have FHA-HAMP with different more restrictive rules and GNMA with almost impossible to get a HAMP rules.

Again this is why the petition is important and we need to make media and Congress aware of all messy a well designed HAMP program has become.

Freddie Updated Servicing Guide at
http://www.freddiemac.com/sell/guide...df/bll0926.pdf

Fannie at
https://www.efanniemae.com/sf/guides.../2009/0931.pdf

[worrywart1]

That's excellent info Dave. Thanks for taking the time to summarize and post the details here.

Is there a way to create sticky's? I don't know who the moderator is now that Moe has stepped down.

I think info list this should be noted at the top of the threads.

[flagirl4444]

The bad
Any forbearance can not exceed 100% of FMV - I am not sure but I think it use to be 125%. This kills forbearances if underwater. But not effective till 12/1/09 Something similar had been in prior HAMPAdmin directives.

That doesn't kill forbearances. What it means is this: If you owe $400k on the house and the FMV is $275, they can forbear up to $125k if necessary to get you to the target payment. They just can't forbear more than the difference between what you owe and the FMV.

[michelle.m]

Can someone explain what the treatment of non taxable income means in the Fannie mae guide? I don't quite understand.

[davephx]

Originally Posted by flagirl4444

The bad
That doesn't kill forbearances. What it means is this: If you owe $400k on the house and the FMV is $275, they can forbear up to $125k if necessary to get you to the target payment. They just can't forbear more than the difference between what you owe and the FMV.

I think however it dramatically effects the NPV Test which has to pass before and after any forbearance calculation. Again I am speculating but not getting the cash flow on the forbeared amount could turn the NPV test into fail with a large forbearance and therefore wouldn't do.

This may be why we have seen so few forbearances.

[BadBobMo]

So let's think about this new revision, their are many new doc's to show that you are actually on the HAMP "Trail Period Plan" going forward right? Why?

Now let's just look at this from our point of view, let' say even if only 1/2 of the 500,000 so called current "Trail Period Plans" are still not on the HAMP "Trail Period Plan"
So why do I bring this up, because the new revision doe's nothing to reassure any of us that has not received any type of HAMP doc that say's-SO!! Ok the Orginal Doc Revision said that the "Lender did not need a singed copy from you" Ok that's fine what do you have that says that you are on the HAMP "Trail Period Plan" program.
How many of us have been fooled thinking we were on a 3 month trail plan?
Then only to get another verbal lie ok now you are on the plan but still no doc!
Think about this, with the new doc's changes it would of been real easy to insert (Form-***) that the lender "is to sign" and send it to anyone that is on the plan "period"
Everyone needs to call and make sure that they are 100% on plan! Try your best to get some doc's that say's So!!! also ask if they have started reporting to Fannie your trail period payments. They had 4 business day's after receiving our 1st payment.
You can not trust the gov.-writers or bankers "period" read my early post and watch and learn.
Fired Up Ready To Go
Just do a search.
Keep up the fight and start asking for fairness "Write Down"

Effective Date
Unless otherwise indicated, all policy changes included in this Announcement are effective immediately.

When the servicer uses the RMA, the Hardship Affidavit, Fraud Notice, and Trial Period Plan are no longer required.


(Form 196) (generally referred to as TPP Notices) – describes the terms and conditions of the trial period plan. Unlike the existing Trial Period Plan (Form 3156), the borrower is not required to sign or return a TPP Notice.

Fannie Mae is also modifying its signature requirements for the existing Trial Period Plan (Form 3156) to align with this new policy. Accordingly, a borrower in a trial period plan who makes all required trial period payments, but does not sign and return the current Trial Period Plan prior to the end of the trial period, may receive a HAMP modification as long as the servicer has received all required trial period plan payments and all other HAMP-required documentation from the borrower, including a fully executed Home Affordable Modification Agreement (Form 3157).

Refer to the “Executing the HAMP Documents” section below for additional details on the use of these documents.

If the servicer determines that the borrower is approved for a trial period plan, the servicer must either:

send a TPP Notice for Verified Income (Form 196) to the borrower, or

if the borrower is currently in a trial period plan pursuant to a stated income TPP Notice, send a written notice that the borrower has been approved for a HAMP modification pending timely receipt of all trial period payments.

If the servicer determines that a borrower cannot be approved for a trial period plan, the servicer must communicate that determination to the borrower in writing and consider the borrower for another foreclosure prevention alternative.
Servicers must retain a copy of the TPP Notice in the mortgage loan file and note the date that it was sent to the borrower. Receipt of the first trial period payment under the TPP Notice by the Trial Period Offer Deadline will be deemed as evidence of the borrower’s acceptance of the trial period plan and its terms and conditions.

[kcchica]

I feel brain dead... and am hoping I understand this correctly..

we are finally under consideration for HAMP through BOFA, THEY required us to do 4 months of forebearance at 1/2 payments because we were CURRENT and they indicated they couldn't do anything for us unless we were behind.

Unfortunately I believed that meant we had the 4 month "trial" because we were current, not a 3 month standard "trial" payment plan for HAMP.

Then after we finished our 4 month forebearance agreement (Nov 1), the loss mitigation/loan modiciation girl told me that unfortunatley, we still had to do the 3 month trial payment plan... BUMMER! I was so hoping to be set up before xmas..

Still haven't heard anything official, about what we qualify for, etc...

However, in reading this post, is it saying that the 3 month trial payment is no longer required? And they should just be able to modify us now?? Becacuse I was told, we had to now do the 3 month Hamp Trial Payment Plan per government requirements (this was about 2 weeks ago.. so prior to the release of this new document)..

Just hoping for some good news.

EDITING TO ADD WE ARE FANNIE MAE

Thanks
kc

[davephx]

Yes confusing.
For Fannie Mae, it is a 4 month trail if in imminent default (less than 30 days delinquent) vs 3 month for in default.

But you are not than supposed to do another 3 month HAMP trial. The 4 month was HAMP/Fannie.

But in my case with Citi after 3 payments they restarted another 3 month trial because either or:

1) They never sent me any Trial Agreement I had been trying to get since July. So they restart and did a Trial Agreement last week.

2) They are just so far behind they restarted masses of us already on trials to give them time to catch up.

I do not know where you got that the 3 month trial is not required. It is but not 4+3

[ama125]

I think a lot of people that got forbearance agreements were misled and actually told it was or was like a trial period and it was not clearly explained. A forbearance is just a reduced payment.

[Littlelost]

Dave, I am no longer Littlelost but Hugelost:-(.
I am not understanding this at all. The forbearance part.

[davephx]

Forbade is where they defer payments or lower for like six months. After that you have to make full regular payments PLUS an amount to catch up with what should have been paid vs was paid during the forbearance period.

The only time its useful to buy time to get mod approved. But if not approved your worse off.

[Littlelost]

Thanks Dave. That's what I am worried about. The differ amount that we can not pay is accumulated by the end of 6 mo and we will be in a ditch. I really really wish there is something I could do in getting additional income .. I have worked so hard to find a job... everywhere.. every little hole.