Homeowner Affordability and Stability Plan · HAMP / GSE-SMP / FDIC-LMP Comparison This is a...

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Homeowner Affordability and Stability Plan

Helping Homeowners Today

Genworth Mortgage Insurance

1For Homeowner Assistance questions, call 800 444.5664


Disclaimer: This Presentation Is Designed To Be A General Overview Of The Home Affordability And Stability Plan. It Is Not A Complete Set Of Guidelines And Should Not Be Used As The Comprehensive SourceOr For Qualification Purposes. This Presentation Will Provide A General Understanding Of The Program And Will Also Direct The Audience To Consult With The Appropriate Guidelines Sources.



1. Home Affordable Modification Program

2. Home Affordable Refinance Program

3. Supporting Fannie Mae and Freddie Mac


Home Affordable Program – HAMP or HARP?

Standard Refi *

No

GSE Loan?

OO SFH Primary?

HARP**

No

Delinquent on Mtg?

Yes

Imminent Default?

No

LTV > 105%?

HAMP

Yes

HDTI < 31%?

Yes

Qualify for HAMP?

No

HAMP or HARP**

Yes

Yes Yes No Yes No No

Once You Get To Green Box – See If Your Homeowner Qualifies for That Program

Possible Program

Servicer of Loan?

Yes

Start Here

Genworth MI?

DU Refi Plus** or GNW Insured Refi

MI?

DU RefiPlus**

No

No

DU RefiPlus**

No

Yes Yes

(1-4)

Caution – This Flow Chart Only Discusses HAMP and HARP – Other Mod Programs and RefiPrograms May Be Available

*For Those Servicers Who Have Received TARP Funds, HAMP is Also an Option.

** HARP & DU Refi Plus Boxes May Include Standard Rate and Term Refi and GNW Insured Refi Where Applicable


Loan Workout Modification PlansMar ‘09Dec ‘08Jun ‘08 Sep ‘08

• Making Home Affordable Modification

– Fannie, Freddie, Bank Portfolio Loans

& Other Mortgages

– For Delinquent Borrowers and

Borrowers at Risk of “Imminent Default”

• HopeNow Streamlined Modification Program

– Fannie & Freddie

• FDIC Loan Modification Program

– FDIC Banks– Recommended Guidelines

for the Mortgage Industry

• Traditional WorkoutModifications


HAMP / GSE-SMP / FDIC-LMP Comparison

This is a general overview and should not be considered complete as it is used for example purposes only.

PROGRAM Home Affordable Mod GSE's - HOPE NOW Streamline Mod FDIC Modification Program

Days past due required Imminent Default or Defaulted borrowers will qualify 90 Days past due 60 Days past due

Target HDTI 31% 38% 10% Decrease in HDTI - starting with 38%

In Foreclosure ? Yes Yes Yes

In Bankruptcy? Yes No No

Mark-to-Market LTV N/A Mark-to-Market LTV > 90% None

Subordinate Financing CriteriaProgram has incentives of $250 for servicer to extinquish 2nd

liens - details are expected soon

Subordinate Liens are not considered in LTV

or PITIA pmtSubordinate Liens are not in LTV or PITIA

Property Value Appraisal, AVM, BPO Appraisal, AVM, BPO Appraisal, AVM, BPO

NPV Test Yes No Yes

Owner-occupied Yes Yes Yes

Primary Residence Yes Yes Yes

Investor Property No No No

Property Type 1- 4 Single-family dwelling (co-op, condo, or mfg housing) Single-family dwelling (co-op, condo, or mfg

housing) excludes 2 - 4 family props

Only borrower's primary residence

(1 - 4 units OK)

Counseling RequirementBorrowers w TDTI of > 55% they need to agree to get

Borrower Counseling to be approved

Probation/Trial Period? 90 Day Trial Period 90 Day Probation Period First payment

Principal Write-down? Yes - May Do Principal Waiver as well No No

Incentives Servicer, Investor & Borrower Incentives Servicer Incentives Servicer Incentives

Servicer Incentive? (A) Up-Front One Time Payment of $1,000 Yes - $800 $1,000 Payment

Servicer Incentive? (B) 3 yr "Pay for Success" Fee of up to $1,000 per yr

Servicer Incentive? ( C): Up Front, Imminent Default Borrower, Payment of $500

Lender/Investor Incentive?(A) 50% of Investor cost to take pmt from 38% to 31% HDTI

for up to 5 years

Lender/Investor Incentive? (B) Up-Front One Time Payment of $1,500

Lender/Investor Incentive? (C): Home Price Decline Incentives

Borrower Incentive? (A) 5 yr "Pay for Success" Fee of up to $1,000 per year


Popular And Rapidly Evolving Programs

Loan Modifications

1.Capitalization

2.Rate

3.Term

4.Principal Forbearance


Home Affordable Modification Waterfall on Loans With MI

Borrower

Eligible?

Determine Affordable Payment

For 31% HDTI*

Capitalize

Past Due

Amounts

Principal Forbearance

(Balloon Due at Loan Payoff

Extend the TermTo

40 Years

Reduce the

Interest Rate

(floor of 2%)

Borrower Doesn’t Qualify for HASP

Modification

HDTI of 31%Obtained

Passes

NPV Test?**

Conclusion TBD on Case

By Case Basis

Servicer Completes

HASP Loan

Modification

MI Co PerformsCase-by-Case

Review for OtherLoss Mit Options

Servicer SendsReport to MIBased on

Established Requirements

HDTI of 31%Obtained

HDTI of 31%Obtained

Borrower Considered For Other

Workout Options

Need MI

Approval?

Servicer CompletesAlternative

Workout Option

So

lve f

or

Aff

ord

ab

le P

aym

en

tE

lig

ibilit

y

YesYes

No

No No

Yes

No

No

1

2

3

4

5

6

7

Yes

Borrower in Default or Imminent Default - Servicer Obtains Required Documentation

*First Solve for 38% HDTI. Then, if Applicable, Solve for 31%. It Is Assumed in This Flow Chart, That the Reader Will Want To Qualify the Borrower at 31% HDTI.

** NPV Test of Freddie, Fannie or Applicable Investor


Home Affordable Modification

Program

•GSE & Other Mortgages

•Hardship Letter

•In Default or Imminent Default

•Current HDTI >31%

•Owner Occupied / Primary

•Single Family (1-4 unit)

•90 Day Trial Period After Approved

•Up To 40 Year Term

•Rate Floor of 2%

•Original Loan Closed Before 1/1/09 –

Mod Closed Before 12/31/12

•Forbearance Allowed

•May Forgive Principal-Not Required

Process•Verify Gross Monthly Income

– Verbal Now / Written at Closing

•Solve for 31% HDTI (PITIA)

•Capitalize Arrearages

•Reduce Note Rate

– 5 Year Term

– Step Up

•Amortize Over 40 Years

•Forbear Principal if Necessary

– Forgive Principal if Chosen

•Apply NPV Test (Freddie, Fannie Or

Applicable Investor)


1

2

3

4

5

6

7


Borrower Profile (example)•Owes $320,000

•FMV $275,000

•Rate 7.0%

•Term is 30 Year

•PITIA $2,728– PI $2,128 + TIA $600

•Income $5,000

•HDTI 55%

•90 Days Behind

•OO SFH



Program•GSE & Other Mortgages

•Hardship Letter

•In Default or Imminent Default

•Current HDTI >31%

•Owner Occupied / Primary

•Single Family (1- 4 Unit)

•90 Day Trail Period After Approved

•Up To 40 Year Term

•Rate Floor of 2%

•Original Loan Closed Before 1/1/09 –

•Mod Closed Before 12/31/12

•Forbearance Allowed

•May Forgive Principal-Not Required


Borrower Profile

•Owes $320,000

•FMV $275,000

•Rate 7.0%

•Term is 30 Year

•PITIA $2,623

– PI $2,023 + TIA $600

•Income $5,000

•HDTI 55%

•90 Days Behind

•OO SFH

Step 1: Solve for 31% HDTI•Income x .31 = PITIA (MI Not Included)

•5,000 x .31 = 1,550

•TIA is Fixed at 600

•PI Needed is $950

$1,550 – $600 = $950



Step 2: Capitalize Past Due•Principal + Past Due

•$320,000 + $8,184 = $328,184

3

Step 3: Adjust Rate•$328,184 @ 30 Year Term @ 2.00%

•PI = $1,213

4

2


Profile•Owes $320,000

•FMV $275,000

•Rate 7.0%

•Term is 30 Year

•PITIA $2,623

– PI $2,023 + TIA $600

•Income $5,000

•HDTI 55%

•90 Days Behind

•OO SFH

Step 4: Adjust Term•$328,184 @ 40 Year Term @ 2.00%

•PI = $994

PI Needed is $950



Step 5: Principal Forbearance•$313,700 @ 40 Year Term @ 2.00%

•PI = $950

•$14,484 Principal Forbearance Addedas Non-Accruing/Non-Interest Balloon

5

6

7 Step 6: NPV Pass/Fail Test•If NPV Test a Pass – Mod Completed

•If NPV Test a Fail Case by Case Conclusion


Link to Guideline

•Click Here to Go To The Guidelines

•http://www.ustreas.gov/press/releases/reports/modification_program_guidelines.pdf

•https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0905.pdf

•http://www.freddiemac.com/sell/guide/bulletins/pdf/bll096.pdf



1. Home Affordable Modification Program

2. Home Affordable Refinance Program

3. Supporting Fannie Mae and Freddie Mac


Refinance Plans

Freddie Mac Borrower

Same Servicer

Relief Refi

Fannie Mae Borrower

Same Servicer

Refi Plus

DU Refi Plus

Fannie Mae Borrower

Different Servicer

DU Refi Plus

Not GSE Borrower w/ Genworth MI

Different Servicer or Same Servicer

Genworth Insured Refinance


Home Affordable Refinance Plan

Homeowners with Less Than 20% Equity and Current on Mortgage

Max 105% LTV on Current FMV (Includes Closing Costs)

No Limit on CLTV – 2nds Must Subordinate

All Loan Types Eligible – Primary, 2nd Homes, Investment, Condos, Co-op

New Loan is Fixed or Long Term ARM

Original Loan Closed before March 1, 2009 - Refi Must Be Closed Before June 10, 2010

Original File Docs Included In New File (Same Servicer Only) and Reps and Warrants Continue

MI – Not Needed if Not on Current Loan

Freddie and Fannie Have Different Programs (Above is Applicable to Freddie and Fannie HARP)

GNW Rule - 1 x 30 in Last 12 Months on Mortgage Max and No MTG Lates in Last 90 Days

GNW Rule – Max Origination Fees is Less of 5% or $5,000

GNW Rule – 3 Months Seasoning

Designed for Responsible Homeowners in a Depreciating Home



Freddie Loans – Same Servicer

Charge Changing Condition Market Fee – No Other LLPA

Max Lender Fee is $2,500

Manual Underwrite Only

15, 20 or 30 year Term

3 Months Seasoning

If P & I Payment Jumped 20% in Past 12 months – Min 620 FICO

New Appraisal, AVM or HVE

MI – Same Provider, Same Rate, Same Coverage

Freddie Mac Relief Refinance – Current Servicer Only

http://www.freddiemac.com/sell/guide/bulletins/pdf/bll095.pdfThis Is Not a Compete Detail of the Program. Please Refer to Complete Set of Guidelines to Determine Qualification.



Fannie Loans – Same Servicer

LLPA Based Upon FICO, LTV & Property Type

Not Available for if Existing Loan is EA, Refer w/ Caution IV, Subprime, Alt A, Reverse, 2nds, Recourse (Full or Partial) or Government

Up To 40 year Term

New Loan - No Short ARMs, IO, Potential Neg Am, Balloons or MyCommunity

Manual Underwrite Only

No Seasoning Required (GNW Requires 3 Months)

New Appraisal (Exterior Only if <95% LTV) or Warrant No Decline in Original Value

MI – Same Provider, Same Rate, Same Coverage

Fannie Refi Plus – Same Servicer Only

https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0904.pdf

This Is Not a Compete Detail of the Program. Please Refer to Complete Set of Guidelines to Determine Qualification.



Fannie Loans – Any FNMA Approved Lender Can Do the Refi Starting April 4 (MI May 1)

LLPA Based Upon FICO, LTV & Property Type

Not Available for Reverse, 2nds, Recourse (Full or Partial), Government or LPMI

Up To 40 year Term

New Loans - No Short ARMs, IO, Potential Neg Am, Balloons or MyCommunity

DU Only – Cannot Flip to Manual Underwrite if Don’t Like DU Finding

No Seasoning Required (GNW Requires 3 Months)

Unless Waived, New Appraisal (Exterior Only if <95% LTV) or Warrant No Decline in Original Value

MI – Same Servicer w/ Same MI Provider = Same Rate, Same Coverage

New Servicer* w/ Same MI Provider = New Rate, Same Coverage

Fannie DU Refi Plus – All FNMA Approved Lenders – Same or New Servicer

https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2009/0904.pdf


* >620 FICO – DTI Max 45% - Full Doc – Meet Standard Genworth Guidelines


Genworth-Insured Refinance


Homeowners with Less Than 20% Equity and Current on Mortgage

Max 105% LTV on Current FMV (Includes Closing Costs)

No Limit on CLTV – 2nds Must Subordinate

All Loan Types Eligible – Primary, 2nd Homes, Investment, Condos, Co-op

New Loan is Fixed or Long Term ARM

1 x 30 in Last 12 Months on Mortgage Max and No MTG Lates in Last 90 Days

Max Origination Fess is Less of 5% or $5,000

3 Months Seasoning

MI – Same Servicer w/ Same MI Provider = New Rate, Same Coverage, 575 FICO Floor, New Appraisal or Warrant No Decline in Original Value

New Servicer w/ Same MI Provider = New Rate, Same Coverage, 620 FICO, Max 45%DTI, New Appraisal, Full Doc

Outside of GSE – Same or New Servicer


For More Info

http://mortgageinsurance.genworth.com/RatesAndGuidelines/MakingHomeAffordable.aspx

For Questions

Call 1 800 444-5664 for Genworth ActionCenter

Email – [email protected]

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