The time has come! Supplemental
Directive 13-09 to the Making
Homes Affordable handbook will take effect in two days on January 10, 2014.
As discussed in a previous entry,
this Supplemental
Directive makes the loss mitigation process easier, clearer, and more
efficient. It is an alignment with the final Consumer Finance Protection Bureau
(CNPB) Mortgage
Servicing Regulations, which prohibit high risk lending and will also take
effect on January 10, 2014.
Servicers must review documents and submit Incomplete
Information Notices in tighter timeframes than ever before. This makes sense
because most borrowers submit incomplete initial packets anyway and should be
advised of missing documents immediately to move forward from the initial
stage. By contacting the borrowers earlier and responding to them quicker,
servicers are now able to maximize borrower protection in their review of loan
modification applications.
The
Department of the Treasury and the
Department of Housing and Urban Development did not want to completely
overhaul the Making
Homes Affordable guidebook because they did not want to alter or destroy
the integrity of the programs. All changes to the Making
Homes Affordable handbook were kept to a minimum and in accordance with the
final
CFPB Mortgage Servicing Regulations. Remember, the CFPB
regulations are the bare bones of requirements for servicers, so when
servicers review borrowers for HAMP,
they still must consider the Making
Homes Affordable handbook and state laws as well.
Also, HAMP
still remains top priority even though CFPB
regulations require borrowers to be considered for all loss mitigation
options at the same time. If the servicer participates in the HAMP
program and the borrower is eligible for HAMP,
the borrower must be given HAMP
over other in-house loan modifications.
