2 Agenda U.S. Bank Home Mortgage Lender Approval Delivery and Funding Top ExceptionsPurchase ProcessHelp Desk and Lender ReferenceCustomer Service and Loss MitigationUnderwriting Highlights and ResourcesQ & A
3 U.S. Bank Home Mortgage “Master Servicer” 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.
4 Working with Housing Authorities is our Business All loansServiced atour locationare originatedthrough Stateand LocalHFA ProgramsDedicatedFacility and Team ofIndividualsThe ONLY MRB Master Servicer with a Facility SOLELY DEDICATEDto the Acquisition and Servicing of MRB Loans2
6 Lender ApprovalAll lenders MUST be approved by both U.S. Bank and HOC to participate in the programThe U.S. Bank MRBP lender application is sent out with the lender invitation packageThe MRBP Lender Help Desk will be responsible for the approval of all lenders
7 PreparationAdvise borrower their loan is being sold to U.S. Bank Home MortgageShip 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
8 Delivery & Funding Access information at: mrbp.usbank.com Click on U.S. Bank lender manuals > to AllregsReview Delivery and Funding Guidelines, Checklists, Forms, and any UpdatesShare information with Originators, Closers & Shippers
15 Insurance Deductibles – Government Hazard / FloodDeductibles 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 / HurricaneThe 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.
16 Reference Endorsements / Assignments “U.S. Bank National Association” (First Mortgages)Hazard Insurance / Loss Payee Clause:U.S. Bank National Associationits successors and or assigns as their interest may appear.c/o U.S. Bank Home MortgageP.O. Box 7298Springfield, OHBorrower Payment Address and Website:U.S. Bank Home Mortgage P.O. BoxBedford, OHMERS ID #:
17 Program Information FHA loans only Minimum FICO for all borrowers is 640Debt 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
18 Fees and Compensation Fees Compensation Loan Funding Fee - $150.00 Tax Service Fee - $85.00Compensation1.5% SRP, based on principal balance of loan at time of funding
19 Loan File Delivery Address ALL Loan Files should be sent to:U.S. Bank Home Mortgage17500 Rockside RoadBedford, OHAttn: Operations DepartmentLoans will be reviewed within 3-5 business days of receipt
20 Loans With ExceptionsU.S. Bank will communicate all loan exceptions to a designated person via daily fax and weekly recap reportExceptions can be ed toPlease provide separate cover letter/sheet for each loan exception and include U.S. Bank loan numberOnce all outstanding deficiencies have been resolved and loan has been compliance approved, U.S. Bank will purchase the loan
21 Most Frequent Document Exceptions 1. Mortgage / Deed of TrustMissing ridersTax Exempt, Condo, PUD Riders if applicableMissing pages of the mortgage and/or legal descriptionNotary section left blank or incorrectly completedProperty address differs from other documentation2. NoteMissing originalEndorsement incorrect: U.S. Bank National AssociationIncorrect payment terms. Must be = 360Property address differs from other documents
22 Most Frequent Document Exceptions 3. Truth in LendingInitial T-I-L not in fileFinal T-I-L not in fileCorrective final T-I-L, if applicable, not in fileMI under-disclosed or not disclosed in the payment streamReminder: new form required per BulletinRefer to Bulletins and for further information regarding T-I-L requirementsNote: 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.
23 Most Frequent Document Exceptions 4. HUD-IDAP assistance is not properly identified or has an amount that differs from other documentsMissing signed copy of the final HUD-1Evidence of tolerance violation in GFE fee comparison with no cure (see Bulletin )Monthly escrows not collected5. Good Faith EstimateMost recently issued in file does not match loan terms at closing (see Bulletin )Missing from file
25 Real Estate Settlement Procedures Act (RESPA) U.S. Bank’s File ReviewU.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 formEnsure HUD-1 is on proper formVerify “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 applicablePost 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.
26 Most Frequent Document Exceptions 6. Initial Loan ApplicationInterviewer date missingMissing from fileDate for timing of early T-I-L not documented properly (see Bulletins and )7. Hazard and Flood PoliciesNames and addresses do not match other documents exactlyFlood coverage inadequateDeductibles greater than requiredFlood policy missing flood zone, or zone on flood policy does not match zone on flood certificationProof of payment not included in file
27 Most Frequent Document Exceptions 8. Manufactured Housing Documentation RequirementsEvidence of title being surrendered to state not in fileModel number/name missing from Security AgreementEndorsement 7.1 not added to title commitmentSecurity Instrument missing information on manufactured home9. Underwriting DocumentationDU findings missing from fileUnderwriting Transmittal Summary missing or not signedMissing or inconsistent underwriting documentation for Conventional files
28 Most Frequent Document Exceptions 10. AssignmentMissing from fileNot assigned correctly to U.S. Bank National Association (Endorsement on note must match – see Bulletin )Incorrect references to lender, borrower, and/or property information11. FHA ConnectionFHA Connection is checked during the review process for certain information, and the following errors cause delays in funding:Incorrect closing dateIncorrect ADP codeNo evidence that the UFMIP was sent to FHA
29 Loan Purchase ProcessLoans are purchased once all closed loan file exceptions and compliance exceptions have been cleared and HOC has given final compliance approval to U.S. BankLoans will be funded at an amortized balance net of escrow funds (no checks)Loans are purchased dailyPurchased loan summary / detail is faxed to lenders
30 Lender Help Desk Help Desk Line: E-Mail the Help Desk Status of loans the Help DeskStatus of loansStatus of documents receivedLoan Deficiencies / ExceptionsProgram guidelinesGeneral information
31 Lender ScorecardQuarterly analysis is completed based on loans received for purchase and their performanceLoans placed on exception, not cleared or purchased within required timeframesYTD deficiencies, delinquency, foreclosure & bankruptcy statisticsFinal recorded documents over 240 days outstandingLenders and HOC are advised in writing of any issues
32 Post-Purchase - Final Documents Organize documents according to checklistAll lenders are responsible for delivery of documents to U.S. BankDue within 120 days from purchase by U.S. BankA late fee of $50 will be assessed after 120 daysDeliver to:Document Control17500 Rockside RoadBedford, OhioFinal Doc SupervisorDarlene Kreigh –(216)
33 Post-Close Trailing Doc Exceptions Title Policy:Mortgage amount is missingSchedule A, item 4 contains incorrect mortgage recording informationName of insured is incomplete (needs to mirror mortgage and have “it’s successors and/or assigns”)Missing required endorsementsSecond Mortgages:Closing date is incompleteMissing marital status of borrower(s)Incorrect maturity dateLegal description missingTax Exempt Rider is recorded with Second Mortgage instead of the First MortgageAssignments:Missing all recordings of the mortgage
34 Customer ServiceU.S. BankCommitmentToCustomer Service
35 Customer Service MRBP Servicing Location 17500 Rockside RoadBedford, OHAll MRBP Bond loans serviced from this facility!Borrower Payment Address and website:U.S. Bank Home MortgageP.O. BoxBedford, OHCustomer Service Toll Free NumberHours: Monday – Friday7:00 am – 8:00 pm EST
36 Customer Service Borrowers receive monthly billing statements Spanish Speaking Customer Service & Default RepresentativesInteractive Voice Response System (24 hours a day)Mortgagor Website Access (24 / 7)Call Center Operations M-F (7:00am – 8:00pm est.)Default Servicing Call Center Operations (8:00am – 8:00pm est.)Flexible Payment Methods: ACH, Mail,Website, Phone
37 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 mitigationOur goal is to offer any attempt to initiate a repayment plan or a loss mitigation workout optionLoans active in foreclosure are not eliminated from receiving assistance. All foreclosure loans are solicited for loss mitigation efforts until the foreclosure sale date
38 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 homesU.S. Bank interviews borrowers obtaining their reason for default and provides options that are available to help. *Borrowers have the ability to establish repayment plans online for their situationDVD video “We’d like to help”, mailed to borrowers. Available in English/Spanish. Pamphlet also mailed to borrowers offering assistance
39 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 FHAIt 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 requirementsU.S. Bank and HOC are not liable for loans not meeting product guideline criteriaPlease note – only DU or LP may be used. Other lender customized automated underwriting systems are not acceptable at this time
40 Underwriting Highlights Credit Underwriting is the responsibility of the originating lender, U.S. Bank Home Mortgage (Master Servicer) will not re-underwrite loansAll loans are subject to both internal and agency auditsUnderwriters should…Make sound credit decisionsAssure data integrityInclude all necessary documentsProvide supporting documentation for the UW decision
41 Resources FHA Underwriting Guidelines Guide – rev 5FHA websiteAllregsSearch answers.hud.govPhone Monday-Friday, 8 am to 8 pm ET1-800-CALLFHA ( )
42 Q & AQ: 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.