Servicing Handbook Issued By Treasury Department Sets Forth New Rules For HAMP-Participating Loan Servicers When Evaluating Loan Modifications

Lexology reports:

• There is a new manual governing HAMP loan modification practices, and the changes, often subtle but important, are worth noting. The United States Department of Treasury created the Home Affordable Modification Program (“HAMP”) to assist homeowners in default (or at risk of default) on their mortgages.

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• Although participation in the program is voluntary, HAMP imposes a number of requirements on participating servicers, including notice and reporting requirements. Until now, such requirements could be found only in what some perceived to be confusing and contradictory “Supplemental Directive” letters available on the HAMP website for servicers, www.HMPadmin.com.

• The Treasury Department has now released a Servicing Handbook that combines the former Supplemental Directives while also amending or revising prior guidelines. [...] The new Servicer Handbook does not merely collect prior guidelines — it establishes entirely new rules, in some cases clarifying or superseding prior Supplemental Directives.

For more, including an overview of the major new guidelines or clarifications, see The Home Affordable Modification Program: new handbook, revised guidelines (subscription required; if no subscription, TRY HERE; or GO HERE, then click link for the story).

For a copy of the new Servicer Handbook, see Making Home Affordable Program: Handbook for Servicers of Non-GSE Mortgages (Version 1.0 - 77 pages).