Making Home Affordable

Transcription

1 Making Home Affordable Working Together to Help Homeowners March 2014 Making Home Affordable

2 You will be able to print today s presentation and listen to the Encore Replay this evening from HMPadmin.com Learning Center > Trusted Advisors > Presentations > Short Sale Workshop & Webinars 03/13: Short Sale Workshop Jacksonville, FL Follow us on March 2014 Making Home Affordable 2

3 Outreach Events for Homeowners 91 events put over 76,700 homeowners face to face with housing counselors and servicers. Event partnership with HOPE Now, HUD, and NeighborWorks America ensure events of high quality. March 2014 Making Home Affordable 3

4 Help for Homeowners Event Jacksonville, FL is our 92nd event. Learn more at MakingHomeAffordable.gov March 2014 Making Home Affordable 4

5 MHA Offers Solutions MHA and related programs work together to help homeowners avoid foreclosure. Transition from Home Ownership Historically Low Mortgage Interest Rates AVOIDING FORECLOSURE Breathing Room for Unemployed Help When You Owe More Than the Home is Worth More Affordable Payments March 2014 Making Home Affordable 5

6 MHA Provides Relief to Struggling Homeowners More than 1.9 million actions taken to help homeowners. MHA Foreclosure Avoidance Programs Homeowner Assistance Actions MHA First Lien Permanent Modifications Started 1,536,053 Second Lien Modification Program (2MP) 126,547 Home Affordable Foreclosure Alternatives (HAFA) 266,547 *Does not include 3 million Home Affordable Refinance Program (HARP) refinances through December *Source: Housing Scorecard. The Obama Administration s Efforts To Stabilize the Housing Market and Help American Homeowners, February Unemployment Program (UP) Forbearance Plans 38,445 Total 1,967,592 Source: Making Home Affordable Program Performance Report Through January 2014 March 2014 Making Home Affordable 6

7 There s Still Work to Do While we see signs of recovery, many families and communities continue to struggle with foreclosure. Source: RealtyTrac March 2014 Making Home Affordable 7

8 HAFA Offers Transition from Homeownership When the weight of homeownership becomes too great, there are still options to avoid foreclosure. Home Affordable Foreclosure Alternatives (HAFA) includes short sale and deed in lieu of foreclosure (DIL). Think HAFA when: Mortgage has become unaffordable, and homeowner needs a way out. Homeowner doesn t qualify for modification. Modification doesn t work out. Homeowner has moved and needs to sell. Path back to homeownership generally shorter from short sale than from foreclosure. March 2014 Making Home Affordable 8

9 HAFA Offers Benefits HAFA continues to set the standard for short sales in a difficult market. HAFA available for principal residence, rental property, and vacant property (not condemned). HAFA features standardized time frames. Short sale terms can be pre approved. Commission for real estate professionals is set. Homeowner must be released from personal liability for mortgage debt. Relocation assistance ($3,000) may be provided to homeowner or tenant. Cap on subordinate lien payoff amounts increased from $6,000 to $8,500. Foreclosure not to be completed during review. March 2014 Making Home Affordable 9

10 Financial Hardship Eligibility for Service Members HAFA recognizes PCS as financial hardship. HAFA takes into account the challenges a PCS order creates for service member. Service member can cite PCS order as basis for financial hardship: Regardless of whether income decreased. As long as the service member does not have sufficient liquid assets to make mortgage payments. March 2014 Making Home Affordable 10

11 Industry Resources Resources are in place to help. HAMP Solution Center Fannie Mae Freddie Mac FHA Loans FHA National Servicing Center USDA RHS Loans Centralized Servicing Center VA Loans Mortgage Help Resources (866) (800) 7Fannie KnowYourOptions.com (800) Freddie, select option 2 FreddieMac.com (877) HUD.gov/offices/hsg/sfh/nsc/nschome.cfm (800) (877) HomeLoans.va.gov March 2014 Making Home Affordable 11

12 HMPadmin.com HMPadmin.com MHA Program Guidance Online Learning Resources Newsletters March 2014 Making Home Affordable 12

13 HMPadmin.com HAFA Resources HAFA Overview provides important details on required homeowner and servicer forms. March 2014 Making Home Affordable 13

14 HMPadmin.com > Learning Center Upcoming training events Register at HMPadmin.com > Learning Center > Trusted Advisors > Training Events HAMP A to Z for Trusted Advisors March 18, :30 3:00 p.m. ET 2MP for Trusted Advisors April 2, :30 3:00 p.m. ET Hardest Hit Fund Overview for Trusted Advisors April 9, :30 2:30 p.m. ET Case Escalations for Trusted Advisors April 10, :30 2:30 p.m. ET Unemployment Program for Trusted Advisors April 16, :30 2:30 p.m. ET March 2014 Making Home Affordable 14

15 MakingHomeAffordable.gov MHA.gov > Participating mortgage companies > Eligibility tools > HOPE Hotline > New landing pages in additional languages March 2014 Making Home Affordable 15

16 MHAStorefront.com Order MHA brochures and posters. Have them shipped to you at no cost. March 2014 Making Home Affordable 16

17 17 March 2014 Making Home Affordable 17

18 Chase by the Numbers through January 2014 National 7.0 million Mortgages Serviced for Chase or Other Florida 502, ,982 Modifications Completed 86, ,252 1,156,356 Short Sales Completed since 1/09 Foreclosures Prevented** at Chase Since 1/09 53, ,022 **Includes modifications, forbearance, short sales, repayment plans, term extensions, and deeds-inlieu/settlements 18 Page 18

19 Chase by the Numbers through August 2013 National 7.2 million Mortgages Serviced for Chase or Other Philadelphia, PA* 132, ,540 Modifications Completed 9, ,379 Short Sales Completed since 1/09 1,973 1,044,313 Foreclosures Prevented** at Chase Since 1/09 15,941 *Philadelphia-Camden-Wilmington, PA-NJ-DE-MD MSA ** Includes modifications, forbearance, short sales, repayment plans, term extensions, and deeds-inlieu/settlements 19 March 2014 Making Home Affordable 19

25 All About Short Sales A guide to working with Wells Fargo Jacksonville, Florida 3/13/2014 Rachael Kerns Assistant Vice President Short Sale Liquidation Manager

26 Strategic partnership Wells Fargo and our REALTOR partners Wells Fargo s primary concern and obligation is to our customers and investors. Our goal is to exhaust all efforts to help customers remain in their homes through various workout options. Once home retention efforts are no longer an option, Wells Fargo continues to work diligently to provide an alternative to foreclosure through a short sale. Our last resort is to foreclose. 26

27 Strategic partnership Wells Fargo and our REALTOR partners Currently we have over 500 dedicated Short Sale team members and Four Short Sale Service Centers located across the country. Our partnership with experienced real estate brokers and their agents, who are familiar with the management of distressed real estate, is key to our success and commitment to quality service. In 2013 Wells funded/completed over 62,000 short sales nationwide In 2014 we are predicting approximately 45,000 completed short sales 27

28 Wells Fargo Short Sales Wells Fargo is a SERVICER as well as a LENDER. 82% of the loans we service are owned by outside investors 69% are owned/guaranteed by FannieMae, FreddieMac, or Ginnie Mae 13% are owned by Private Investors 18% of the loans we service we also own 28

29 Wells Fargo Short Sales There are a number of decision makers involved in most short sales the more parties involved, the more complex the process becomes. All parties must be aligned and in agreement before the home can be sold, i.e., investors, second lien holders, and mortgage insurance companies. Most importantly, this is not a typical buy-sell transaction this is a DEBT SETTLEMENT transaction. 29

30 Wells Fargo Short Sales What to do First Make sure that you have a cooperative and able seller Have borrower/seller contact Wells Fargo to let them know they are interested in doing a short sale Single Point of Contact (SPOC) will be assigned Submit your 3 rd Party Authorization to Wells Fargo for approval Set realistic time frame expectations from the beginning 30

31 Short Sale Process Flow 1. Verify Authorized 3 rd Party 2. Verify Listing Agreement 3. Order Valuation 1. Determine eligibility for full HAFA review 1. Document collection 1. Negotiate offer 2. Approve offer (when offers meets investor guidelines) 1. Collects Jr Lien SS Approval 2. Follows up on file for closing date 3. Obtain Final HUD document 1. Obtain funding via wire transfer 2. Complete transaction All submitted short sales are reviewed for HAFA Eligibility If the file is not eligible for HAFA, then it will be considered for a Proprietary Short Sale if that loan portfolio has one 31

32 Short Sale Common Obstacles Real estate agent is working a short sale without engaging the homeowner Seller must be willing Lack of Buyer Scrutiny Low ball offers being submitted mostly investor buyers Minimum Net Sales Proceeds does not meet the investor guidelines Excessive seller concessions and costs that reduce Minimum Net Sales Proceeds Waiting until the last minute to work on Junior liens and judgments that need to be settled Required documents are missing or not signed and dated properly Unrealistic timeline expectations 32

33 Getting started three options Option 1: Equator Web-based platform for real estate agents Option 2: Phone/Fax - Traditional Call loss mitigation (866) Fax loss mitigation (866) Option 3: Short Sale Field Team Localized sales team in high-priority markets (i.e., CA, FL, AZ, NV) Face-to-face support for real estate agents Wells-owned portfolio 33

34 Wells Fargo Online Agent Resource Center New robust online agent content launched September 2012 Provides short sale educational materials, downloadable information and other resources 34

35 Realtor Hotline for Loan Servicing Default Liquidations Escalations AM 10PM CST Mon Fri 35

36 March 2014 Jacksonville, FL Kamara McMullen AVP Short Sales

37 Florida Inventory 37

38 Process Overview Request Assistance Underwrite for Eligibility & Prequal Borrower chooses treatment Submit Required Documents Order Evaluation Market the Property Submit Offer Investor Decision Closing 38

39 Short Sale Listed Team Proactively follow up on value orders Work to resolve disputes Help establish list price based on Investor requirements Follow up every 30 days to discuss list price reduction Questions Listing advisor will ask up front: Does the borrower want the SS completed and are all borrower and co-borrowers cooperating fully? Is Citi the only lien holder? Is the property currently listed for sale? What is the borrower's current mailing address? Is the property currently occupied and, if so, by whom (borrower or tenant)? 39

40 Obstacles Service Release New Servicer agrees to honor approvals. Follow up to make sure all docs received If offer falls through, foreclosure or release can continue. Borrowers will receive a goodbye letter from Citi and a Hello letter from new servicer. 2 nd Liens Citi Settlements Top five: 8% up to $8500 GSE: 6% up to 6k 1. Can be initiated by borrower Other: Case by case 2.Send letter with pre-determined offer 3. LOA from borrower Citi negotiators will help get 2 nd settled. Value disputes Send in three comps (sold and listed) Send in supporting documents Engineers report Repair bid (no cosmetic) New information we may have missed 40

41 Getting Started 1. Initiate Short Sale with CitiMortgage Homeowners Assistance Team (HAT) at (866) Account number. Borrower Social Security Number (SSN). Borrower(s) first and last name. Letter of Authorization (LOA). Borrowers Financials. 41

42 Getting Started Assign a Single Point of Contact and collect documents: Homeowner Support Specialist Hotline (HOSS) (855) Fixed 1 st & 2 nd Lien Fax: HOST.CitiLinkdocs@citi.com Home Equity Line of Credit Fax: HOST.CUSTOMdocs@citi.com OneMainFinancial or CitiFinancial* Fax: HOST.Networkdocs@citi.com 42

43 Standard Short Sale Documents Required: Getting Started Letter of Authorization Letter from borrower opting out of retention Two recent paystubs Two recent bank statements Two years tax returns 401K Statements/Investments Profit and Loss (Self employed) Unemployment benefits Expenses Hardship letter Estimated HUD1 Purchase Contract Dodd Frank Certification Arm s Length Affidavit Manage Account at: 43

44 Getting Started Streamlined Short Sale Documents Required: Letter of Authorization Estimated HUD1 Purchase Contract Dodd Frank Certification Arm s Length Affidavit Letter from borrower opting out of retention 90+ days delinquent and FICO <

45 Getting Started 3. Determine Fair Market Value 45

46 Marketing & Selling 5. Submit offer, HUD1, Addendums, etc 46

47 Closing the Deal 6. Investor Decision Come to an agreement on the terms of the offer and determine the closing date. 47

48 Closing the Deal 7. Closing 48

49 Key Numbers RECOVERY: (800) INITIATE: Homeowners Assistance Team (HAT) at (866) SPOC: Homeowner Support Specialist Hotline (HOSS) (855) ESCALATE: Short Sale Hotline

50 Short Sales Understanding Short Sales in 2014 March 2014

51 What s Changed New mortgage servicing standards: Earlier single point of contact assignment Streamlined financial document collection process Comprehensive evaluation process Improved communication This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 51

52 There are two ways to initiate the Short Sale process: Short Sale Initiation: Option #1 Modification Review 1. A short sale record will be opened if the home retention evaluation indicates the customer does not meet eligibility requirements to retain the property. Customers interested in proceeding with the short sale evaluation can advise the short sale specialist to add the agent of their choice to the file. The same homeowner documents collected during the home retention evaluation will be used in the evaluation of the short sale. A letter will be provided to the homeowner advising which short sale program they may qualify for. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 52

53 Short Sale Initiation: Option #1 Modification Review Primary Point of Contact = Customer Relationship Manager (CRM) Secondary Point of Contact = Modification Specialist Secondary Point of Contact = Short Sale Specialist Short Sale is initiated Incomplete Information Notification (IIN) Evaluation Notice Letter Welcome Letter Valuation Letter Approval/Decline Letter Please note: this is not a comprehensive list of communications that you will receive from your specialist. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 53

54 There are two ways to initiate the Short Sale process: Short Sale initiation: Option #2 Direct Entry to Short Sale 2. The customer chooses to proceed directly to a short sale evaluation and not be evaluated for a loan modification at this time. Agent initiates short sale in Equator and assists the customer to upload the required documentation. The Incomplete Information Notice (IIN) will document a list of all missing borrower documents. A Borrower Election form must be signed and returned prior to receiving a short sale approval letter. Note: Direct Entry is not an option for FHA investor properties. FHA properties must been evaluated for home retention options prior to being considered for a short sale. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 54

55 Short Sale initiation: Option #2 Direct Entry to Short Sale For this option, the customer may choose to proceed directly to a short sale evaluation and not be evaluated for a home retention options at this time. Please insure the customer has explored all home retention options available to them prior to initiating a short sale. Primary Point of Contact = Customer Relationship Manager (CRM) Secondary Point of Contact = Short Sale Specialist Short Sale is initiated Welcome Letter Advisement Letter (Borrower Election Form) Incomplete Information Notification (IIN) Valuation Letter Approval / Decline Letter Please note: this is not a comprehensive list of communications that you will receive from your specialist. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 55

56 Valuations As always, you and your client play an important role in the valuation process. After the short sale initiation steps have been completed: A valuation will be ordered immediately There are no Equator agent tasks during this stage You will need to help schedule the valuation and work with the customer to provide access to the property New A valuation report will be provided for any value that is used as part of the short sale evaluation. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 56

57 Escalation Basics Personal Support from a Dedicated Team To receive timely responses to your questions, please contact team members in this order: 1. Your short sale specialist: Send an Equator message with details about your issue. The specialist should respond within two business days; if not, you may contact the team lead 2. The short sale team lead: Send an Equator message by selecting Team Lead from the drop down menu in the To field. The specialist should respond within two business days; if not, you may call Short Sale Customer/Agent Care 3. Short Sale Customer/Agent Care: Call to explain your issue. This should be your first point of contact for urgent issues Most issues in the short sale process can be prevented by following the tips: Be Aware of Deadlines. Many steps in the short sale process are time sensitive. Check for Equator tasks daily and make note of deadlines provided by your short sale specialist. By using Equator for all communications, you can keep track of all communications and responses. Understand the Equator Processing System. Equator is the best way to communicate with your short sale specialist and track the progress of the short sale. If you are not familiar with the Equator Processing System, education guides are available in the Agent Resource Center to assist you with the steps to complete a short sale. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 57

58 Resources By working together, we can make the short sale process more understandable and efficient, and help your clients have a better experience. For Real Estate Professionals For Homeowners Agent Resource Center Home Transition Guide Community Resource Directory Short Sale Customer/Agent Care: This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. 58

59 During the short sale process, loan servicing may be transferred to a different loan servicer. Servicing refers to collecting principal, interest, and escrow payments, if any, as well as sending monthly or annual statements, tracking account balances, and handling other aspects of the loan. We may assign, sell, or transfer the servicing of a loan at any point while the loan is outstanding. Your client will be given advance notice before a transfer occurs. Depending on the status of the short sale when the servicing of a loan is transferred, the new servicer may not be required to accept the terms and conditions of a short sale. Screenshots are the exclusive property of Equator, LLC and used herein under limited license for Bank of America training purposes only. Any distribution, reproduction, derivative, description or account of the screenshots is expressly prohibited without the express written consent of Equator, LLC. This material is solely intended as education and training documentation for real estate professionals and is not intended for consumer use or distribution. Programs, rates, terms and conditions are subject to change without notice. Bank of America, N.A., Member FDIC. Equal Housing Lender Bank of America Corporation. C

60 Discussion/Questions U.S. Department of the Treasury Homeownership Preservation Office March 2014 Making Home Affordable 60