Ocwen Loan Servicing, LLC - Home Affordable Foreclosure Alternative (HAFA) Matrix All servicers that have signed agreements with the U.S. Department of the Treasury (Treasury) to participate in the Home Affordable Modification Program (HAMP) must consider eligible borrower(s) who do not qualify for HAMP for other foreclosure prevention options including Home Affordable Foreclosure Alternatives (HAFA), which includes short sale and deed-in-lieu (DIL) resolutions. However, each servicer has some discretion in determining additional eligibility criteria and certain program rules. In order to assist borrower(s) and their representatives in understanding any unique components of a servicer’s HAFA Policy, Treasury has developed this HAFA Matrix. The summary information in this matrix is prepared solely by Ocwen and does not represent any determination by the Treasury as to the servicer's compliance with the Treasury's policies and guidance for HAFA. Treasury does not endorse any language or policy described in this matrix. Any questions regarding the information contained in this matrix should be directed solely to Ocwen. Last Updated: September 24th, 2011 ELIGIBILITY REQUIREMENTS for HAFA Short Sale/DIL SHORT SALE The loan should be secured by a first lien. The loan should have originated on or before January 1, 2009. The maximum current unpaid principal balance (UPB) for different property units should be as follows: # of Property Units UPB 1 $729,750 2 $934,200 3 $1,129,150 4 $1,403,400 The borrower does not qualify for a HAMP trial period plan or an in-house modification. Properties that are vacant are also reviewed for HAFA, provided the property is non-owner occupied or rented to a non-borrower for not more than 12 months prior to the date of the request for approval of a short sale agreement. The borrower needs to provide proof of the same. The HAFA offer cannot be extended if the sole borrower on the account has deceased. The HAFA offer cannot be extended if the loan or subject property is the subject of litigation, mediation or active bankruptcy. Ocwen will consider possible HAMP-eligible borrowers who have a short sale offer for HAFA within 45 calendar days of the date: The borrower does not qualify for a HAMP trial period plan; The borrower does not successfully complete a trial period plan; If the borrower previously received a HAMP modification, the borrower has missed at least two consecutive payments under after the HAMP modification took effect. The projected or NMLS #: 1852 confirmed foreclosure sale date should be no less than 60 days from the date of determination of eligibility. The Investor and/or Mortgage Insurance Company permit a short sale resolution. The loan has not matured. DIL The loan should be secured by a first lien. The loan should have originated on or before January 1, 2009. The maximum current unpaid principal balance (UPB) for different property units should be as follows: # of Property Units 1 2 3 4 UPB $729,750 $934,200 $1,129,150 $1,403,400 The borrower does not qualify for a HAMP trial period plan or an in-house modification. The borrower does not successfully complete a Trial Period Plan or an in-house plan. If the borrower previously received a HAMP modification, the borrower has missed at least two consecutive payments under after the HAMP modification took effect. The projected or confirmed foreclosure sale date should be no less than 60 days from the date of determination of eligibility. The market value of the subject property should be greater than $20,000. The Investor and/or Mortgage Insurance Company permit a DIL resolution. The loan has not matured. The subject property should not be vacant/ rented for more than 12 months. The HAFA offer cannot be extended if the sole borrower on the account is deceased. The HAFA offer cannot be extended if the loan or subject property is the subject of litigation, mediation or active bankruptcy. SHORT SALE DOCUMENTATION REQUIREMENTS The following documents are required for the HAFA Short Sale Approval: for HAFA Short Executed Hardship Affidavit/Request for Modification and Affidavit (RMA); Sale/DIL Occupancy letter with utility bill confirming that the borrower occupied the subject property as his or her primary residence at some point within the prior 12 months; Dodd-Frank Certification; and If the RMA or Hardship Affidavit do not have details regarding income and expenses, a written financial form is required. NMLS #: 1852 DIL The following documents are required for HAFA DIL Solicitation Approval Executed Hardship Affidavit/Request for Modification and Affidavit (RMA). Occupancy letter with utility bill confirming that the borrower occupied the subject property as his or her primary residence at some point within the prior 12 months. Dodd-Frank Certification If the RMA or the Hardship Affidavit does not have details regarding the income and expenses, a written financial form is required. VALUATIONS SHORT SALE At the time of reviewing a loan for a HAFA Short Sale, Ocwen requires a recent assessment of the market value of the subject property by Automated Valuation Model/ Brokers Price Opinion (AVM/BPO). The assessment should be within 150 days of the review. The market value must exceed $20,000. DIL At the time of reviewing a loan for a HAFA DIL Solicitation, Ocwen requires a recent assessment of the market value of the subject property by either Automated valuation model or Brokers price opinion (AVM/BPO). The assessment should be within 150 days of the review. Once the solicitation offer is accepted, Ocwen requires an updated Interior Valuation to proceed with the further review for HAFA DIL and borrower(s) would need to provide contact details and access to the property for the interior valuation to be carried out. Disputed Valuations – If the borrower(s) or realtor(s) wish to dispute the value they must submit a copy of the Comparative Market Analysis (CMA) form to Ocwen at Facsimile : 407-737-5071 or by Email:
[email protected] . The estimated evaluation timeline will be within 10 business days. POLICY / SPECIAL PROGRAMS SHORT SALE Short Sale Program— Customary Terms and Conditions are as follows: 1. Allowable Costs that may be deducted from Gross Sale Price include: o Closing Costs – The closing costs paid by borrower(s) or on borrower(s) behalf as seller must be reasonable and customary for the market. Acceptable closing costs, including the commission, which may be deducted from the gross sale proceeds, may not exceed 8% of the list price. Closing costs that may be deducted from the gross sale proceeds are limited to title search and escrow expenses usually paid by the seller. o Subordinate Liens – Ocwen will allow up to 6% of the unpaid principal balance of each subordinate lien (only mortgage-related liens) in order of priority, not to exceed a total of $6,000, to be deducted from the gross sale proceeds to pay subordinate lien holders to release their liens. o Real Estate Commissions – Ocwen will allow real estate commissions as stated in the listing agreement between borrower(s) and borrower(s) broker, not to exceed six percent (6%) of the contract sales price, to be paid to the listing and selling brokers involved in the NMLS #: 1852 2. 3. 4. 5. transaction from sale proceeds. Neither borrower(s) nor the buyer may receive a commission. o Borrower Relocation Assistance – If the closing occurs in accordance with the agreement, borrower(s) will be entitled to an incentive payment of $3,000 to assist with relocation expenses. Parties to the Sale – The Sales Contract must include the following clauses: “Seller and Buyer each represent that the sale is an “arm’s length” transaction and the Seller and Buyer are unrelated to each other by family, marriage or commercial enterprise.” “The Buyer agrees not to sell the property within 90 days of closing of this sale.” Foreclosure Sale Suspension – Ocwen may initiate or continue the foreclosure process as permitted by the mortgage documents; however, Ocwen will suspend any foreclosure sale date until the specific expiration date of the short sale request or the date of closing of an approved short sale, whichever is later, provided that the borrower(s) abide by all applicable terms and conditions. Satisfaction and Release of Liability – If all of the terms and conditions are met, upon sale and settlement of the property, Ocwen will prepare and send to the settlement agent for recording, a lien release in full satisfaction of the mortgage, foregoing all rights to pursue a deficiency judgment. Termination of short sale request – Unless otherwise agreed by the parties, the request will be terminated on a specified date, but may be terminated earlier if: o Borrower(s) fail to provide all the required documents. o Borrower(s) financial situation improves significantly, borrower(s) qualify for a modification, borrower(s) bring the account current or borrower(s) pay off the mortgage in full; o Borrower(s) or borrower(s) broker fails to act in good faith in closing on the sale of the property or otherwise fails to abide by the terms of the short sale request; o A significant change occurs to the property condition or value; o There is evidence of fraud or misrepresentation; o Borrower(s) file for bankruptcy and the Bankruptcy Court declines to approve the short sale; or o Litigation is initiated or threatened that could affect title to the property or interfere with a valid conveyance. DIL Deed-In-Lieu – All loans that meet the eligibility criteria (see above eligibility requirements) will be reviewed for HAFA DIL and if the loans qualify, a HAFA DIL solicitation approval letter will be sent to them. AVERAGE TIMELINES SHORT SALE Below are the timelines for different milestones during the HAFA short sale review process: Acknowledgement of HAFA Short Sale: Ocwen will send an acknowledgement letter to the borrower(s) within 10 days of the receipt of the completed short sale package; Missing documents for HAFA Short Sale: The borrower(s) must send the missing documents within 15 business days from the date of the missing document letter. Acknowledgement of HAFA Short Sale during review process: Ocwen will send an acknowledgement letter to the borrower(s) on the 40th day of the review stage if more time is required to review the file. Acknowledgement of Request for Alternate approval of Short Sale Package: The borrower(s) must return the signed HAFA Acceptance Agreement to Ocwen within 45 calendar days from the date of the acknowledgement letter. NMLS #: 1852 DIL Below are the timelines for different milestones while reviewing a loan for HAFA DIL: Missing documents for HAFA DIL solicitation: Borrower(s) must send the missing documents within 10 business days from the date of the missing document letter. Acknowledgement of HAFA DIL solicitation letter: The borrower(s) must return the signed HAFA Acceptance Agreement to Ocwen within 14 calendar days from the date of the acknowledgement letter. Request for interior market valuation: The borrower(s) must provide access to the valuation team to the subject property to get an interior inspection done within 10 business days from the date of a request for an interior valuation. Receipt of DIL agreement: The borrower(s) must return a fully signed HAFA DIL Agreement to Ocwen within 7 business days from the day it is sent to the borrower(s). Response to property not being vacant: Once the DIL Solicitation Approval letter is sent to the borrower(s), they are required to vacate property within 60 days from the date of the letter. CONTACT INFORMATION Below are the contact details for HAFA related questions: General HAFA questions: - Customer Care Center (CCC) – (800) 746-2936 Valuation appeals: - Customer Care Center (CCC) – (800) 746-2936 Transaction Status: - Customer Care Center (CCC) – (800) 746-2936 Escalation of complaints concerns: - In case of any escalations or disputes, borrower(s) can contact Ocwen using the following methods and provide evidence substantiating their complaint: Facsimile: (407) 737-5171 Email:
[email protected] mail: Ocwen Loan Servicing, LLC, P.O. Box 785061, Orlando, FL 32878 The contents of this matrix are general in nature. Additional conditions and constraints may apply based on investor or mortgage insurer restrictions or other external program requirements. NMLS #: 1852