Servicing Government Loans
MBA drives alignment in servicing policy among FHA, VA, and USDA Rural Housing mortgages to lower servicing costs and improve borrower outcomes
Overview: Rise in default and increased regulatory burden saddled servicers in the last decade with rapid increases in servicing costs for government insured and guaranteed mortgages. MBA's Loan Administration Committee works to enumerate pain points and potential areas of alignment between the agencies to advocate for sensible policy revisions for a brighter future. Clear and consistence guidance leads to more equal outcomes for borrowers, and reductions in cost and headaches for servicers encourage greater participation in government programs designed to aid vulnerable populations.
NEW WHITE PAPER: Improving Default Mortgage Servicing Processes: Opportunities for Alignment and Standardization
Following the foreclosure crisis of 2008, federal foreclosure prevention programs and consumer protection laws were put into place that provided more standardization and alignment of loss mitigation and foreclosure processes across the industry. However, key differences still remain in default servicing requirements, resulting in different servicing protocols depending on who owns, insures, or guarantees the mortgage. This white paper identifies areas where greater alignment or standardization could benefit borrowers or communities and/or improve servicing efficiencies while reducing costs and mitigating losses for federal guarantors and insurers.
Recent MBA Activity Related to Servicing Government Loans
- Comment Letter: MBA to CSBS on IMB Prudential Framework (December 28, 2020)
- Joint Trades Letter: Coalition to HUD on Claims Without Conveyance of Title (CWCOT) (March 9, 2020)
- Comment Letter: MBA Comments on Proposed Debt Collection Rule (September 18, 2019)
- Joint Trades Letter: Coalition to FHA on Revisions to the Loan-Level Certifications and Defect Taxonomy (June 28, 2019)
- Joint Trades Letter: Proposed Revisions to the FHA Lender Annual Certification (June 7, 2019)
- Letter: MBA to FHA on Single Family Housing Policy Handbook Update (April 19, 2019)
- Comment Letter: MBA to VA regarding Revisions to VA Loan Guaranty and Cash-Out Refis (February 15, 2019)
- Comment Letter: MBA to VA regarding Interim Rule on VA Loan Guaranty and Cash-Out Refis (January 24, 2019)
- Comment Letter: MBA to USDA on Proposed Changes to Loss Mitigation and Loss Claim Process (October 22, 2018)