UNEMPLOYMENT MORTGAGE ASSISTANCE PROGRAM ( UMA ) Operational Term Sheet

Transcription

1 UNEMPLOYMENT MORTGAGE ASSISTANCE PROGRAM ( UMA ) Operational Term Sheet All homeowner intake, counseling, eligibility and benefit determination, and KYHC program benefit processing will be performed by the CalHFA MAC Keep Your Home California Central Processing Center ( CPC ) except where specifically indicated in Section 4 (Servicer Program Requirements). KYHC-approved HUD counseling agencies are eligible to perform homeowner intake and counseling activities. 1. Homeowner/Loan Eligibility Criteria For the homeowner/loan to be eligible: 1.1 Homeowner* must qualify as a low-to-moderate income household. The low-to-moderate income limit for a household in the county in which the homeowner resides is as posted on the Keep Your Home California website at the time of the request for assistance. 1.2 Loans in foreclosure may be eligible [see section 3.7] 1.3 Current, unpaid principal balance ( UPB ) (includes the interest-bearing unpaid principal balance and any existing non-interest bearing forbearance balance) of the first lien mortgage loan is not greater than $729, Homeowner agrees to provide all necessary documentation to satisfy program guidelines established by CalHFA MAC. * Homeowner is a person(s) obligated to pay the loan as evidenced by the first lien Mortgage Note, includes their legally married spouse or Registered Domestic Partner ( RDP ). 2. Property Eligibility Criteria For the property to be eligible the property is: 2.1 Located in California. 2.2 A single family, 1-4 unit home (an attached or detached house or a condominium unit). Mobile homes are eligible if they are permanently affixed to the real property that is secured by the first lien. 2.3 A Home Equity Line of Credit ( HELOC ) in first lien position is ineligible for consideration. Includes any open-ended Deed of Trust. 2.4 The homeowner s primary owner occupied residence. 2.5 Not abandoned, vacant or condemned. UMA Ops Term Sheet Version 14.0 Page 1 of 8 Revised April 1, 2016

2 3. UMA Program Eligibility Criteria 3.1 Program-specific eligibility is determined by the CalHFA MAC CPC on a first-come/first-approved basis until program funds and funding reserves have been exhausted. 3.2 Homeowner is not required to complete Foreclosure Prevention or Debt Management counseling. KYHC counseling is for the sole purpose of determining conditional program eligibility and is not intended to meet, supplement or substitute for other HAMP or Servicer required counseling. 3.3 Homeowner must complete, sign and deliver to the CPC a KYHC Hardship Affidavit/3 rd Party Disclosure and Homeowner Acknowledgement form to document the reason for the hardship. 3.4 Homeowners who have recently encountered a financial hardship due to underemployment or unemployment, including those whose unemployment hardship is related to their military service. Including but not limited to: Members of the California National Guard or military reserves ordered to federal active duty. Any active duty military personnel who were transferred and required relocation. Any formerly active duty military personnel who have been honorably discharged within the prior six months. 3.5 Homeowner s total monthly first lien mortgage payment, PITI (principal, interest, tax and insurance, as applicable) and any homeowner s association dues or assessments must exceed 31% of the homeowner s gross monthly household income, excluding unemployment benefits. Temporary income; e.g. unemployment benefits is not used to qualify for UMA. Short term disability may be included for a co-homeowner (not the EDD/UMA recipient) if that co-homeowner is still employed. 3.6 Documentation to support income cannot be older than 90 days as of the date of determination of eligibility for KYHC benefit. 3.7 Loan is not in foreclosure. Foreclosure is evidenced by the recording of a Notice of Default ( NOD ) greater than 60 days prior to the date of request for KYHC assistance. 3.8 Homeowner that has been denied HAMP UP approval by their Servicer may still be eligible for UMA consideration, per HAMP S.D , provided all other KYHC eligibility criteria are met. 3.9 Homeowner in a permanent modification is eligible for UMA consideration provided all other KYHC eligibility criteria are met. Homeowner may be required to provide the CPC with a copy of their Loan Modification Agreement. UMA Ops Term Sheet Version 14.0 Page 2 of 8 Revised April 1, 2016

3 3. UMA Program Eligibility Criteria (cont.) 3.10 Homeowner must be approved for and actively receiving unemployment benefits from the California Employment Development Department (EDD) and includes homeowners whose benefits lapsed or expired within 30 days of the date of their request for KYHC assistance Homeowner will be required to provide the CPC with a copy of their most recent EDD paystub and any additional documentation that may be requested to determine eligibility Homeowner is eligible for a maximum of up to eighteen (18) months of unemployment benefit assistance subject to the remaining program balance or $54,000 and: The CPC re-verification of KYHC eligibility will occur with the EDD prior to the disbursement of the fourth, seventh, tenth, thirteenth and sixteenth UMA benefit payments. The homeowner may be required to submit to the CPC current documentation that provides evidence of continuing unemployment and/or eligibility for EDD unemployment benefits. The remaining UMA assistance benefit balance is sufficient to fund additional full PITI (principal, interest, tax and insurance) and any escrowed homeowner s association dues or assessments. The total number of additional payments will be dependent on the remaining benefit balance. Partial payments are not permitted. Homeowners re-applying for additional UMA benefit must have a minimum of three months of UMA benefits remaining under the current program guidelines to be eligible for further benefit consideration Homeowners must complete, sign and deliver to the CPC a KYHC Affidavit of Unemployment document and attest to their unemployed condition. UMA Ops Term Sheet Version 14.0 Page 3 of 8 Revised April 1, 2016

4 4. Servicer Program Requirements 4.1 Servicer will comply with CalHFA MAC KYHC reporting requirements as provided for in the Memorandum of Understanding ( MOU ) or the Data and Reporting Exhibit, as applicable. 4.2 Servicer is required to obtain investor and/or mortgage insurance approval as applicable prior to acceptance and submission of the Common Data File ( CDF ) to the CPC. 4.3 Servicer should report a full file status report to the credit reporting agencies for each loan that receives KYHC Program assistance in accordance with Fair Credit Reporting Act as well as other applicable laws. 4.4 Servicer must have a signed KYHC MOU with Exhibits on file indicating participation in the Keep Your Home California - UMA program. 4.5 Servicer is responsible to complete the CDF entries and submit the required information to the CPC via a secured FTP site. Servicer is required to comply with all CDF protocols and amendments as approved by the CDF committee and/or KYHC. 4.6 CalHFA MAC will require that the Servicer waive all accrued and unpaid late charges and NSF fees for all payments funded with UMA benefits. Waiver must be performed when the Servicer applies the benefits to the homeowner s loan. 4.7 UMA benefit may only be applied to PITI (principal, interest, tax and insurance, as applicable) and any escrowed homeowner s association dues or assessments. HOA dues or PUD escrowed assessments that are a condition of the loan or have been impounded as a result of delinquency should be included. Payments of any 3rd party fees or optional insurance premiums are prohibited. Bi-monthly payment amounts are prohibited as UMA benefits are funded once monthly. 4.8 Should homeowner become re-employed at any time during the UMA benefit period, UMA funds in Servicer s possession are to be applied to the homeowner s loan subject to PITI (principal, interest, tax and insurance), any escrowed homeowner s association dues or assessment payment guidelines. [See KYHC Overage Policy] 4.9 Upon completion of all UMA benefit assistance payments and based on homeowner need, the Servicer agrees to consider an extension of forbearance plan (such as HAMP UP or other proprietary program) or other foreclosure prevention program as applicable per investor guidelines If during the UMA benefit period the homeowner requests and is being considered for a Short Sale or Deed in Lieu, the Servicer is responsible to notify KYHC. UMA benefit payments may not be used to make mortgage payments if a homeowner is actively working with their Servicer to sell or transfer their home. UMA benefit payments will be terminated if KYHC identifies this condition. UMA Ops Term Sheet Version 14.0 Page 4 of 8 Revised April 1, 2016

5 4. Servicer Program Requirements (cont.) 4.11 If the homeowner loan is an Option ARM or Pick a Pay, the Servicer is required to utilize and apply KYHC funds to the fully amortizing payment option available. If the fully amortizing payment amount exceeds the maximum monthly UMA benefit, the Servicer may select another payment option. The goal is to apply the maximum amount of principal available to the homeowner loan each month Servicer may elect not to have a particular mortgage loan or borrower participate in any UMA transaction Servicer agrees to use the information provided in the KYHC Servicer Bulletins and Operational Term Sheets to maintain program knowledge and ensure proficient participation levels If KYHC determines servicer CDF information results in an overfunding or funding of a transaction that would have otherwise been determined ineligible, KYHC reserves the right to seek reimbursement from the Servicer for benefits disbursed. Potential reimbursement conditions include but are not limited to: Misstated Forbearance / UPB. Misapplication of funds e.g. approved for Recast applied as Curtailment. Discrepancies determined through CalHFA MAC QC review Servicer is required to notify KYHC per CDF W records protocols anytime one of the following disqualifying events occurs: Homeowner is accepted for a HAMP trial modification and has made their first trial payment. (Acceptance of a non-hamp modification is permitted and notification is not required) Servicer becomes aware that homeowner has listed their home for sale. Servicer becomes aware that homeowner has become reemployed Servicer becomes aware that the homeowner no longer occupies the home. i.e. home is abandoned, vacant, or condemned Loan has been selected for servicer transfer during active UMA benefit disbursement period. Homeowner is approved for short sale or deed-in-lieu Servicer should object to or withdraw from KYHC assistance if the following condition(s) are present: First mortgage loan s interest rate exceeds 10% per annum. Subject property loan is actively involved in litigation and/or insurance claim. Loan was made for non-residential/commercial purpose. UMA Ops Term Sheet Version 14.0 Page 5 of 8 Revised April 1, 2016

6 5. UMA Benefit Administration 5.1 CPC will determine homeowner eligibility and benefits for all KYHC programs and submit to CalHFA MAC for funding. (see Funding exhibit ) 5.2 Funding reservation and allocation will be tracked, monitored and reported by CalHFA MAC in the CPC. 5.3 Homeowner must execute a non-recourse, non-interest bearing subordinate loan in favor of CalHFA MAC secured by a junior lien recorded against the property in the amount of the total UMA benefit received. At the conclusion of (5) five years from the date of benefit approval, the subordinate loan will be forgiven. 5.4 UMA benefits are: Subject to the UMA program cap of $54,000. Subject to the total KYHC maximum household benefit cap of $100,000 with respect to monies previously received under KYHC Programs. Subject to KYHC program interaction restrictions (see KYHC Program Eligibility Restrictions). 5.5 Homeowner benefit is equal to the lesser of $3,000 per month or 100% of the PITI (principal, interest, tax and insurance) and any escrowed homeowner s association dues or assessments, for a period up to eighteen (18) months. Servicer has the right to accept/decline UMA benefit payments for loan with monthly PITI (principal, interest, tax and insurance) and any escrowed homeowner s association dues or assessments payments greater than the $3,000 per month KYHC benefit cap. Provided funds are collected from homeowner sufficient to advance due date each month. 5.6 UMA benefits will be paid to the Servicer according to KYHC Funding Schedule as provided in the MOU and CDF. The CPC requires the Servicer provide actual PITI (principal, interest, tax and insurance) and any escrowed homeowner s association dues or assessment payment information for each scheduled benefit payment period that may include changes that occur during the UMA benefit period (rate reset, escrow analysis and escrow shortage). 5.7 Payment changes that occur during the scheduled benefit disbursement period that result in an increase to the monthly PITI amount in excess of the monthly program cap will be considered on a case-by-case basis. 5.8 Any Servicer request for additional funding must be submitted within 30 days of receipt of the original funded payment. All funded benefits will require Servicer confirmation of payment application per CDF P records protocols within 30 days of receipt of funds. 5.9 UMA benefits are required to be repaid to CalHFA MAC by the homeowner prior to the forgiveness period in the event of a sale or a refinance of the property that included cash out wherein there are sufficient net equity proceeds. Recovered funds will be recycled in order to provide additional program assistance until December 31, 2017, at which time any recovered funds will be returned to Treasury. UMA Ops Term Sheet Version 14.0 Page 6 of 8 Revised April 1, 2016

7 6. Program Exclusions 6.1 Homeowner in an active bankruptcy is ineligible for KYHC program assistance consideration. Homeowners who have previously filed bankruptcy are eligible for consideration with proof of court ordered Dismissal or Discharge. 6.2 Homeowner s hardship is a result of voluntary resignation of employment. 6.3 Homeowner is not receiving unemployment benefits from the California Employment Development Department (EDD) or whose benefits lapsed or expired greater than 30 days prior to the date of their request for UMA assistance. Homeowners previously approved for UMA benefits may be eligible for consideration for additional benefits subject to KYHC returning homeowner policy guidelines. 6.4 The unemployment of a non-spousal/non- RDP household member that is not a homeowner, as defined in section 1.1, is a non-qualifying event for UMA consideration even if that income contributed to the mortgage payment. 6.5 Homeowner in an active HAMP trial modification is not eligible for UMA consideration unless the trial is cancelled. 6.6 Homeowner becomes fully employed at any time during the UMA benefit period. 6.7 Homeowner s total monthly first lien mortgage payment, PITI (principal, interest, tax and insurance, as applicable) and any homeowner s association dues or assessments, that are less than 31% of homeowner s gross monthly income, excluding unemployment benefits, are considered affordable and are excluded from KYHC benefit assistance eligibility. 6.8 A Notice of Default ( NOD ) has been recorded on the subject property more than 60 days prior to the date of request for UMA assistance. 6.9 Homeowner is actively being reviewed for a short sale, a deed in lieu and/or TAP benefits Homeowner fails to complete, sign and deliver to the CPC their KYHC Affidavit of Unemployment document Homeowner lists their property for sale. i.e. active MLS listing, for sale by owner, active short sale or deed in lieu transaction Homeowner abandons property no longer lives in home First mortgage loan s interest rate exceeds 10% per annum Subject property loan is actively involved in litigation and/or property insurance claim Loan was made for non-residential/commercial purpose A subordinate lien is in foreclosure as evidenced by a recorded Notice of Default (NOD) and/or Notice of Trustee s Sale (NOS). UMA Ops Term Sheet Version 14.0 Page 7 of 8 Revised April 1, 2016

8 7. Major Investor/Guarantor Inclusions and Exclusions 7.1 The KYHC program is approved for use by most major investors. 7.2 Servicer is required to obtain investor and/or mortgage insurance approval prior to submission of the CDF to the CPC. 8. Program Documents 8.1 Documents Required: KYHC Memorandum of Understanding ( MOU ) with Exhibits Homeowner Action Plan ( HAP ) Hardship Affidavit / 3 rd Party Disclosure and Homeowner Acknowledgement Current EDD Paystub/bank statement documenting EBT Direct Deposit Benefit Award Letter Affidavit of Unemployment Note Deed of Trust UMA Ops Term Sheet Version 14.0 Page 8 of 8 Revised April 1, 2016