I want to make a topic to collect info about negative NVP HAMP denials for Fannie Mae owned loans (or those loans that go by the same guidelines). I've posted my story on some other topics. I don't need this topic to be about my story, just about dealing with Fannie Mae over NVP.
I found some information about next steps when you get denied:
If you are not approved because you failed NPV, the servicer is obliged to tell you the following:
what NPV means
the input factors used for your NPV
the date NPV was completed
Servicer must tell you of your rights, and you have 30 days to request the information. You may verbally request the information (but good luck.) They must answer your written request within 10 days. Note: be sure to make the written request, even if you manage to get information over the phone.
If a foreclosure sale is scheduled they may not complete the sale until 30 days after they send you the values.
You have 30 days in which to challenge certain parts of the NPV for "material" inaccuracies. The letter you get will state examples and lists 15 NPV inputs that are available.
If the NPV can be shown to be inaccurate, they will conduct a new one, but there is no guarantee that will result in approval. (Comment: DUH)
The servicer must come up with an accurate NPV before any foreclosure sale, if you follow the protocol.
Here are a few excerpts from Fannie Mae guidelines re NPV.
My note: If your property value actually goes up, it shouldn't work against you. If your property value goes down during the trial, you won't get the benefit.FAQ
Q2100. Why is an appraisal, broker price opinion (BPO), or automated valuation model (AVM) generated property valuation necessary and when does such a valuation become stale? The appraisal, BPO, or AVM-generated property valuation is an input to the NPV calculator. Pursuant to Servicing Guide Announcement 09-31, the valuation must be less than 90 days old on the NPV submission date. The information will remain valid for the duration of the trial period and does not need to be updated for any subsequent NPV evaluation.
https://www.efanniemae.com/sf/guides...10/svc1003.pdfAnnouncement 09-31 (11/02/09)
Changes to Eligibility Determination Based on Net Present Value Evaluation
In Announcement 09-05R, servicers were instructed not to use the results of the Net Present Value (NPV) test to determine HAMP eligibility for mortgage loans owned or securitized by Fannie Mae. Fannie Mae is modifying this policy to require a determination of eligibility based on NPV test results for mortgage loans with an initial NPV evaluation on or after December 1, 2009.
If the mortgage loan is deemed “NPV negative” (per the NPV model output) where the value for the “no modification” scenario exceeds the value for the “modification” scenario by more than $5,000, the servicer may not perform the modification without the express written consent of Fannie Mae. The servicer will need to compute the difference between the modification and no modification scenarios in order to determine whether the $5,000 threshold has been exceeded.
For example, if the no modification scenario produces a value of $10,000 and the modification scenario produces a value of $4,000, the servicer needs the express written consent of Fannie Mae to perform the modification.
If a mortgage loan is deemed ineligible for HAMP due to the NPV test results, the servicer must explore other foreclosure prevention alternatives following Fannie Mae’s workout hierarchy prior to initiating or resuming foreclosure.
I look forward to seeing some discussion on how this is working for people. This is not everything from the guidelines. It's what I had made note of and could find so as to get the topic going.Announcement SVC-2010-03
Announcement 09-05R requires servicers to re-evaluate a loan using the NPV model if the borrower’s documented income differs from the stated income used in the borrower’s initial qualifying NPV test.
For mortgage loans with an initial NPV evaluation before December 1, 2009, servicers are not required to perform an additional NPV evaluation based on the borrower’s verified income documentation. When the servicer does not perform an additional NPV evaluation in this situation, the servicer should enter the trial period values for NPV Date and NPV Value when reporting the official loan set up file to the Treasury system of record.
In situations where servicers reevaluate a loan using the NPV model based on the borrower’s verified income documentation, servicers are reminded that they should test a borrower using the same major version of the NPV model that was used to test the loan for trial modification eligibility. Detailed versioning requirements are included in the Base NPV Model Documentation, which is available at www.HMPadmin.com, and in Exhibit A of this Announcement.
All active HAMP trial modifications scheduled for cancellation due to an NPV negative result based on an NPV re-testing procedure that was not fully consistent with the HAMP versioning requirements must be re-tested in accordance with the versioning requirements prior to the servicer cancelling the trial modification.
Ensuring that all NPV inputs remain constant when the borrower is retested, except (i) those that were found to be incorrect at the time of the initial NPV evaluation and (ii) inputs that have been updated based on the borrower’s income documentation.
Inputs that may be updated based on the borrower’s documentation are limited to the following:
a. Association Dues/Fees before Modification
b. Monthly Hazard and Flood Insurance
c. Monthly Real Estate Taxes
d. Monthly Gross Income
e. Unpaid Principal Balance After Modification (interest-bearingUPB)
f. Principal Forbearance Amount
g. Interest Rate After Modification
h. Amortization Term After Modification
i. Principal and Interest Payment After Modification
Inputs that may not change regardless of their evolution since the trial’s initiation include:
a. Unpaid Principal Balance Before Modification
b. Borrower FICO and Co-borrower FICO
c. Property Value
d. Interest Rate Before Modification
My servicer went ahead and initiated the foreclosure process immediately upon my denial, so I intend to write them and site from Announcement 9/31:
I did call them on it, but got a 'does not compute' response. They think they are not supposed to hold a foreclosure sale until they eliminate other options, but that they can move the process along so that they're ready to go if the options fail. What I see is that they are not to go any further with the process until they've explored the workout hierarchy.If a mortgage loan is deemed ineligible for HAMP due to the NPV test results, the servicer must explore other foreclosure prevention alternatives following Fannie Mae’s workout hierarchy prior to initiating or resuming foreclosure.
Anyone read that differently?