**(2008 Update)**

**[GENERAL REQUIREMENTS FOR PRESERVATION AND PROTECTION OF PROPERTIES
SECURING FHA INSURED MORTGAGES]{.underline}**

###### Mortgagee Responsibility {#mortgagee-responsibility .unnumbered}

Mortgagees should preserve and protect properties securing FHA-insured
mortgages in accordance with the requirements of 24 CFR 203.377, which
provides that "the mortgagee shall take reasonable action to protect and
preserve such security property when it is determined, or should have
been determined, to be vacant or abandoned until its conveyance to the
Secretary, if such action does not constitute an illegal trespass". In
the event that a property securing an FHA mortgage is conveyed damaged
to the Secretary without prior approval, the Department may, at its
discretion, require the property to be re-conveyed or may require a
reduction to the claim proceeds for the greater of the insurance
recovery or HUD's estimate of the cost of repairing the damage.

Generally, the more diligent a Mortgagee is in completing timely
foreclosure and conveying a property, the lower the expenditure for
preservation and protection will be. A Mortgagee may use any individual
or firm to perform preservation and protection services on properties
securing FHA-insured mortgages; however, the Mortgagee remains fully
responsible to HUD for its actions and the actions of its agents. As a
cautionary note, the Department reminds Mortgagees that in addition to
the surcharges discussed in this Mortgagee Letter, HUD may pursue
enforcement action, including debarment, civil money penalties and
actions under the Program Fraud Civil Remedies Act.

####### Unit Pricing 

> HUD has established an overall maximum cost limit (see **Attachment
> 1**) that establishes the maximum amount that will be reimbursed for
> all preservation and protection expenses on an individual property.
> Additionally, HUD has established maximum allowable costs for
> individual types of expenses such as lawn mowing and lock-changes. Any
> expenses exceeding the cost allowable or exceeding the overall maximum
> cost limit per property are not considered approved by HUD unless a
> Mortgagee has obtained prior written approval from HUD's designated
> Management and Marketing Contractor ("M&M"). HUD will require the
> repayment of claimed reimbursement amounts if it determines that:

-   Amounts paid for reimbursement were unnecessary and excessive;

-   The Mortgagee obtained bids that were not independent and
    competitive;

-   Services claimed were not performed or not performed properly; or

-   The amount claimed exceeded the cost allowable or overall maximum
    allowable limit and the Mortgagee did not obtain advance written
    approval.

> To facilitate the timely securing of abandoned properties, HUD has
> pre-authorized Mortgagees to spend up to a set amount per property for
> expenses directly related to initial securing. This maximum securing
> limit is included within the overall maximum allowable limit as
> further described in **Attachment 3**.
>
> Some types of expenses such as the cost of boarding, inspections,
> securing swimming pools, sump pumps, demolition, vacant/abandoned
> property registration fees and utilities are not included in the
> maximum cost limit per property. These services, with the exception of
> vacant/abandoned property registration fees, will be reimbursed,
> provided costs stay within the cost allowable listed in **Attachments
> 2, 3**, **4**, and **7**. Property registrations fees are set by the
> local jurisdictions.
>
> A Mortgagee should support all expenditures, including costs
> associated with the aforementioned exceptions, with receipts,
> photographs or other documents to support the expenditure. For the
> purpose of claiming reimbursement, HUD considers actions identified in
> this Mortgagee Letter to be pre-approved, provided these actions meet
> all applicable cost limits and are performed in accordance with the
> work requirements identified in this Mortgagee Letter.

**II. [Claim Submission and Documentation]{.underline}**

> HUD will reimburse Mortgagees for preservation and protection actions
> in accordance with the provisions of this Mortgagee Letter upon
> receipt of form HUD-27011 Parts A&B via Electronic Data Interchange
> (EDI) or via the FHA Connection. For instructions on claim processing
> and document submission see HUD Handbook 4330.4, rev.-1, change 1,
> which is available on "www.hudclips.org". Documentation to support
> each claimed expense must be maintained in the Mortgagee's case file
> and must be provided to HUD or its M&M contractor upon request. The
> documentation should support the expenditures and illustrate that the
> Mortgagee took appropriate action to preserve and protect the property
> from the time of default to conveyance. Examples of appropriate
> documentation include copies of all inspections, photographs,
> receipts, applicable law or ordinance with respect to vacant property
> registration and over-allowable approval requests.
>
> If the property suffered surchargable damage and the mortgagee has
> received permission to convey the property un-repaired, Mortgagees
> shall note "yes" on the Part A form, Item 24, "Is the property
> conveyed damaged?" Where item 24 is marked "yes", Mortgagees must also
> include the date that HUD gave permission to convey damaged in item 25
> and also include greater of the insurance recovery or HUD's estimate
> of the cost of repairs in item 27.
>
> Where the damage to the property is non-surchargable, item 25 should
> be marked "no", and the Mortgagee shall include an explanation of the
> non-surchargeable damage in the Mortgagee's Comment Section of Part A.
> See additional guidance in HUD Handbook 4330.4, rev.-1, change 1,
> which is available on [www.hudclips.org](http://www.hudclips.org/).
>
> Mortgagees are prohibited from performing or claiming preservation and
> protection services after the deed has been recorded. However, payment
> of certain utility bills may be considered an exception to this
> guideline (see **Attachment 7**).

**III. [Conveyance of Damaged Properties]{.underline}**

> **A. [Surchargeable Damage]{.underline}**
>
> All properties conveyed to HUD should be undamaged by fire, flood,
> earthquake, tornado, hurricane, or boiler explosion (for condominiums)
> or damage resulting from Mortgagee neglect. Costs resulting from these
> types of damage are considered surchargeable and are excluded from the
> claim for insurance benefits. The Mortgagee must repair the damage or
> obtain prior written permission from HUD to convey a property with
> surchargeable damage.

1.  **[Damage Due to Failure to Preserve and Protect (Mortgagee
    Neglect)]{.underline}**

> HUD will hold a Mortgagee liable if its failure to take reasonable
> action to preserve and protect property that it determined or should
> have been determined to be vacant or abandoned results in property
> damage or destruction. Examples of Mortgagee neglect include but are
> not limited to a Mortgagee's failure to:

a.  Initiate foreclosure within the required timeframe;

b.  Obtain timely and accurate property inspections;

c.  Promptly secure and continue to protect all abandoned properties; or

d.  Promptly notify HUD's M&M contractor of receipt of code violations
    and demolition notices and take appropriate action.

> **2. [Limitation on Fire Damage]{.underline}**
>
> Mortgagees are liable for the full cost to repair fire damage whether
> or not the damage was the result of Mortgagee neglect. However, if the
> property is damaged by fire and is not covered by fire insurance or
> the amount of insurance coverage was inadequate to fully repair the
> damage, the Mortgagee's liability may be limited to the amount of the
> insurance recovery received by the Mortgagee, if any, provided that
> the Mortgagee certifies that all of the circumstances specified in 24
> CFR 203.379(a)(2) exist.
>
> **3. [Damage Due to Mold]{.underline}**
>
> A property may be conveyed with mold if the mold was not caused by a
> surchargeable condition, including Mortgagee neglect, fire, flood,
> earthquake, hurricane, or for condominiums, by boiler explosion.
> However, even if the mold was not caused by a surchargeable condition,
> the failure by the Mortgagee to take reasonable action to remediate
> the cause of the mold and complete any other required preservation and
> protection actions related to minimizing further mold damage prior to
> conveyance of the property, qualifies as Mortgagee neglect and, is
> surchargeable.
>
> **4. [Requesting Approval to Convey with Surchargeable
> Damage]{.underline}**
>
> Mortgagees may not convey properties that have surchargeable damage
> unless the Department provides prior written approval. Until further
> notice, such approval shall be provided by the appropriate M&M
> Contractor having jurisdiction over the subject property. (24 CFR
> 203.379 (b).
>
> Such requests for approval should be sent by facsimile or email to the
> appropriate M&M contractor. The M&M contractor should review and
> respond in writing to the request either by fax or e-mail no later
> than 10 business days following receipt. HUD, at its sole discretion,
> may require that the Mortgagee repair the damage prior to conveyance
> or may elect to accept conveyance of the property in damaged condition
> and require that the claim for insurance benefits be reduced by the
> greater of the insurance recovery or by the government's estimate of
> the cost of repairs. If HUD requires the Mortgagee to repair property
> damages before conveyance, HUD will not reimburse the cost of these
> repairs.
>
> If the claim is adjusted for damages, the Mortgagee should mark item
> 24 of Part A, form HUD‑27011, "yes" and complete items 26 and 27.
> Please note that HUD's claim system will suspend the claim, delaying
> payment, if the mortgagee has noted "yes" in item 24 without providing
> the date of approval in item 26 and the amount of the claim reduction
> in item 27.
>
> As a matter of administrative practice, HUD generally will not deny
> conveyance of properties if the government's estimate of the cost to
> repair the surchargable damage is equal to or less than \$2,500.
>
> **5. [Surchargeable Damage Conveyed Without Approval]{.underline}**
>
> When a property with surchargeable damage is conveyed without prior
> approval, HUD may, at its sole discretion, either re-convey the
> property to the Mortgagee or seek reimbursement from the Mortgagee for
> HUD's estimate of the cost of the repairs (24 CFR 203.379(c)). If
> HUD's estimate is equal to or less than \$2,500, HUD will generally
> reduce the claim payment by the cost to repair the property damage
> rather than exercise its right to re-convey. Only a HUD Government
> Technical Representative (GTR) has authority to approve a
> re-conveyance demand. The M&M contractor will provide a preliminary
> e-mail notification that a property may be re-conveyed as a result of
> property damage within 30 days of the date of conveyance.
>
> The e-mail will identify the reason(s) for the proposed re-conveyance,
> a cost estimate of the property damage and provide the Mortgagee an
> opportunity to respond with additional information. If additional
> information is received from the Mortgagee within 10 business days
> from the date of the e-mail, it will be included in the package
> provided to the GTR for a decision. The GTR will, no later than 60
> calendar days of the date of conveyance, make the final decision to
> take no action, issue a Notice to Re-convey or issue a Demand Letter.
>
> The process for appealing the decision of the GTR is described in
> **Attachment 10**, Mortgagee Appeal Process.
>
> **B. [Properties Conveyed with Non-Surchargeable Damage]{.underline}**
>
> If a property has sustained non-surchargeable damage, the Mortgagee is
> not required to obtain pre-approval before conveyance. However, the
> Mortgagee must include a description of the damage in the "Mortgagee's
> Comments" section of form HUD-27011, Part A. Item 24 of Part A, "Is
> the property conveyed damaged?" should be marked "no". (Note: marking
> **"yes**" in item 24, triggers HUD's claim system to look in item 26
> for the date of HUD's approval to convey the property damaged and to
> item 27 for the amount that the claim is to be reduced. Mortgagees
> must indicate "yes" for surchargable damage and "no" for
> non-surchargable damage.) Inspection reports and photo documentation
> should support the damage assessed.
>
> Additionally, the Mortgagee must include, along with the copy of the
> claim sent to HUD's M&M Contractor, documentation supporting the
> preservation and protection work performed on the property. At a
> minimum, this documentation should include evidence of the date of
> vacancy, validation of the property condition at vacancy and a
> chronology of actions performed by the Mortgagee to preserve and
> protect the property.
>
> If a Mortgagee fails to provide the required explanation in the
> Mortgagee's Comments section of Part A or fails to provide the
> required documentation of P&P actions performed, required
> documentation that clearly identifies the date of vacancy and
> documentation to clearly identify property condition, the M&M
> Contractor will notify the Mortgagee in writing that the Mortgagee has
> 10 business days to provide the information. If no documentation or
> inadequate documentation is received from the Mortgagee the damage
> will be considered surchargeable.

**V. [Permits and Vacant Property Registration]{.underline}**

> Each Mortgagee and/or field service provider should be familiar with
> the state and/or jurisdictional requirements related to city
> ordinances (such as vacant/abandoned property registration) or local
> law. The fee associated with registration of a vacant/abandoned
> property is reimbursable and must be included on your claim.
> Documentation to support such a claim for registration fees must be
> included in the claim review file along a receipt for payment. If and
> when a building permit is required by local law prior to performing
> preservation and protection services, then the Mortgagee must obtain
> the permit. If code violations are related to health and safety and/or
> costs to resolve the violation is less than \$250.00 the mortgagee
> shall complete the work without prior approval from the M&M unless the
> repair causes mortgagee to exceed the overall cap for preservation and
> protection. Otherwise, the mortgagee shall contact the M&M contractor.
> If vacant property registration fee is less than \$250.00 the
> mortgagee shall pay the fee without prior approval from the M&M
> otherwise the mortgagee shall contact the M&M contractor. The M&M
> contractor should intercede with the community on municipal liens
> (i.e., on properties such as those being placed in the ACA program) or
> approve the repairs.

VI. **[Quality Control]{.underline}**

In accordance with 24 CFR, Part 202.5(h) all FHA approved Servicers are
required to implement a written quality control plan covering all
aspects of loan origination and servicing and to conduct regular quality
assurance reviews in accordance with the plan. Servicing quality control
plans should incorporate quality assurance reviews of preservation and
protection responsibilities including a review of work performed by
third party field service contractors and other vendors. A Servicer is
required to provide a copy of its quality control plan as well as
results of quality assurance reviews to HUD staff either during
regularly scheduled servicing and post claim audit reviews or upon
request. All information collections in quality control are covered
under the Office of Management and Budget (OMB) Control Number
2502-0005.

  ----------------- ------------------------------------------ -----------
  Attachments                                                  **Page \#**

  Attachment 1      Maximum Allowable Cost per Property        8

  Attachment 2      Property Inspection Service Requirements   9

                    -Property Inspection Cost Schedule         13

                    -Local Variation from General Requirements 15

  Attachment 3      Lock Change/Securing Service Requirements  16

                    -Lock Change/Securing Service Cost         18
                    Schedule                                   

                    -Local Variation from General Requirements 19

  Attachment 4      Boarding Service Requirements              21

                    -Boarding Cost Schedule                    22

                    -Local Variation from General Requirements 23

  Attachment 5      Debris Removal Service Requirements        32

                    -Debris Removal Service Cost Schedule      36

  Attachment 6      Yard Maintenance and Snow Removal          37
                    Requirements                               

                    -Yard Maintenance Cost Schedule            39

                    -Local Variation from General Requirements 40

  Attachment 7      Winterization Requirements                 41

                    -Winterization Service Cost Schedule       44

                    -Local Variation from General Requirements 45

  Attachment 8      Request to Exceed Cost Limits              47

  Attachment 9      Request to Exceed Timeframes               49

  Attachment 10     Mortgagee Appeal Process                   50
  ----------------- ------------------------------------------ -----------

###### ATTACHMENT 1 Maximum Allowable Cost Per Property {#attachment-1-maximum-allowable-cost-per-property .unnumbered}

  ------------------------------------------------------------------------
  **Maximum Allowable                                          
  Cost Per Property**                                          
  ----------------------- ---------- ------------- ----------- -----------
  **State**               **1 Unit** **2 Units**   **3 Units** **4 Units**

  Alabama                 \$800      \$950         \$1,100     \$1,250

  Alaska                  \$1,400    \$1,550       \$1,700     \$1,850

  Arizona                 \$1,100    \$1,250       \$1,400     \$1,550

  Arkansas                \$1,100    \$1,250       \$1,400     \$1,550

  California              \$1,100    \$1,250       \$1,400     \$1,550

  Caribbean               \$1,100    \$1,250       \$1,400     \$1,550

  Colorado                \$1,100    \$1,250       \$1,400     \$1,550

  Connecticut             \$1,800    \$1,950       \$2,100     \$2,250

  Delaware                \$1,400    \$1,550       \$1,700     \$1,850

  District of Columbia    \$1,400    \$1,550       \$1,700     \$1,850

  Florida                 \$1,100    \$1,250       \$1,400     \$1,550

  Georgia                 \$1,100    \$1,250       \$1,400     \$1,550

  Idaho                   \$1,100    \$1,250       \$1,400     \$1,550

  Illinois                \$1,400    \$1,550       \$1,700     \$1,850

  Indiana                 \$1,100    \$1,250       \$1,400     \$1,550

  Iowa                    \$1,300    \$1,450       \$1,600     \$1,750

  Kansas                  \$950      \$ 1,100      \$1,250     \$1,400

  Kentucky                \$1,100    \$1,250       \$1,400     \$1,550

  Louisiana               \$1,100    \$1,250       \$1,400     \$1,550

  Maine                   \$1,650    \$1,800       \$1,950     \$2,100

  Maryland                \$1,550    \$1,700       \$1,850     \$2,000

  Massachusetts           \$1,650    \$1,800       \$1,950     \$2,100

  Michigan                \$1,400    \$1,550       \$1,700     \$1,850

  Minnesota               \$1,400    \$1,550       \$1,700     \$1,850

  Mississippi             \$1,100    \$1,250       \$1,400     \$1,550

  Missouri                \$950      \$1,100       \$1,250     \$1,400

  Montana                 \$1,100    \$1,250       \$1,400     \$1,550

  Nebraska                \$1,500    \$1,650       \$1,800     \$1,950

  Nevada                  \$1,100    \$1,250       \$1,400     \$1,550

  New Hampshire           \$1,650    \$1,800       \$1,950     \$2,100

  New Jersey              \$1,400    \$1,550       \$1,700     \$1,850

  New Mexico              \$1,100    \$1,250       \$1,400     \$1,550

  New York                \$1,400    \$1,550       \$1,700     \$1,850

  North Carolina          \$1,100    \$1,250       \$1,400     \$1,550

  North Dakota            \$1,100    \$1,250       \$1,400     \$1,550

  Ohio                    \$1,400    \$1,550       \$1,700     \$1,850

  Oklahoma                \$1,100    \$1,250       \$1,400     \$1,550

  Oregon                  \$1,100    \$1,250       \$1,400     \$1,550

  Pacific/Hawaii          \$1,100    \$1,250       \$1,400     \$1,550

  Pennsylvania            \$1,400    \$1,550       \$1,700     \$1,850

  Rhode Island            \$1,650    \$1,800       \$1,950     \$2,100

  South Carolina          \$1,100    \$1,250       \$1,400     \$1,550

  South Dakota            \$1,100    \$1,250       \$1,400     \$1,550

  Tennessee               \$1,100    \$1,250       \$1,400     \$1,550

  Texas                   \$1,100    \$1,250       \$1,400     \$1,550

  Utah                    \$1,100    \$1,250       \$1,400     \$1,550

  Vermont                 \$1,650    \$1,800       \$1,950     \$2,100

  Virginia                \$1,400    \$1,550       \$1,700     \$1,850

  Washington              \$1,100    \$1,250       \$1,400     \$1,550

  West Virginia           \$1,100    \$1,250       \$1,400     \$1,550

  Wisconsin               \$1,400    \$1,550       \$1,700     \$1,850

  Wyoming                 \$1,100    \$1,250       \$1,400     \$1,550
  ------------------------------------------------------------------------

> Note: If a property is located in a state where winterization is
> required, and the property has hot
>
> water heat, add \$250/unit

###### ATTACHMENT 2 Property Inspection Service Requirements and Cost Schedule {#attachment-2-property-inspection-service-requirements-and-cost-schedule .unnumbered}

Vacant and abandoned properties are potential targets for vandalism,
weather damage and criminal activity. Additionally, they present an
attractive nuisance that poses a hazard to children and others who may
be injured. To ensure the preservation of the mortgage collateral and
lessen the negative community impact of vacant properties, Mortgagees
must conduct regular property inspections. Mortgagees may include the
cost of these inspections in a claim for insurance benefits within the
limits described in this section. Claim amounts paid for inspections are
not included in the maximum cost limit per property.

Mortgagee must make an effort to determine occupancy before incurring
the expense of a property inspection. The industry has developed a
variety of tools, including the use of "door-hangers" and "mailers" to
assist a Mortgagee in determining if a property is occupied or vacant.
These tools ask the occupant to contact the Mortgagee to confirm the
occupancy status of the property. The failure of the occupant to respond
within the prescribed time period indicates that a prompt visual
inspection of the property is required. []{.mark}

[]{.mark}

To avoid unnecessary inspections, occupants should be allowed a minimum
of five business days from the date of the mailing or other contact to
respond to the mortgagee. Reimbursement for an occupancy inspection may
be denied by the Department if sufficient time is not provided for
occupant response.

There are five types of property inspections: Occupancy Inspections,
Initial Vacant Property Inspections, Vacant Property Inspections,
Voluntary Pre-Conveyance Inspections and Eviction Inspections. Form
HUD-9519-A, "Property Inspection Report" (now PDF fill-able) may be used
to document and support each claimed inspection/expense. Before and
after photographs are required on all property visits where any
claimable property preservation action is taken. Also, [all]{.underline}
inspections are to be documented. Photographs and inspection reports
should be maintained in the Mortgagee's claim review file and must be
provided to HUD or its contractors upon request. Information collection
activity for inspections and photographs is covered under the Office of
Management and Budget (OMB) Control Number 2502-0306 and documentation
related to claim submission and claim file retention are covered under
OMB Control Number 2502-0429.

Mortgagees may be surcharged for the cost of property damage if
inspection reports are inaccurate, incomplete, untimely or insufficient
in determining a verifiable timeline as to when damage occurred.

**I. [Occupancy Inspections]{.underline}**

> When a mortgage is in default, a payment is not received within 45
> calendar days of the due date, and efforts to reach the Mortgagor by
> telephone or correspondence within that period have proven
> unsuccessful, the Mortgagee must make an Occupancy Inspection in
> accordance with the guidelines herein to determine if the property is
> vacant or abandoned (24 CFR 203-377).
>
> The Occupancy Inspection may determine that the property is (i)
> occupied (ii) vacant but obviously being maintained (e.g., doors and
> windows secured, lawn is cut, For Sale sign on the property, etc.) or
> (iii) vacant and abandoned. Regardless of the result of the occupancy
> inspection, so long as the Mortgagor continues to be in default on the
> mortgage, the Mortgagee should endeavor to establish and/or maintain
> monthly telephone contact with the Mortgagor. If there is no
> documented telephone contact with the Mortgagor for any period of
> 25-35 days from the last contact or the last Occupancy Inspection, the
> Mortgagee shall conduct another Occupancy Inspection.
>
> If the Occupancy Inspection establishes that the property is vacant
> but obviously being maintained, on-going Occupancy Inspections should
> be conducted every 25-35 days following the previous documented
> telephone contact with the Mortgagor or previous Occupancy Inspection
> so long as the mortgage remains in default. Documentation should be
> provided as to how the property is being maintained to justify that
> the property is occupied by the mortgagor.
>
> If the Occupancy Inspection establishes that the property is vacant
> and abandoned, the Mortgagee should document thoroughly the property
> damage, initiate preservation and protection actions and the related
> measures required to secure the property beginning with an Initial
> Inspection.

A.  **[Inspection without Monetary Default]{.underline}**

> Mortgagees should also perform a visual inspection of a property where
> there is reason to believe that the property has become vacant or
> abandoned, even if the property is not in monetary default. Examples
> of information that might indicate vacancy or abandonment include, but
> are not limited to (i) written notice of code violation, municipal
> lien, condemnation or demolition (ii) disconnection of utilities or
> (iii) cancellation of homeowner insurance. Mortgagee should verify
> occupancy through either (i) direct Mortgagor contact by telephone or
> (ii) Occupancy Inspection. Mortgagees should maintain file
> documentation supporting the need for and results of the inspections
> on properties where there is no monetary default.

B.  **[Inspection During Bankruptcy]{.underline}**

> HUD regulations provide that if the mortgage is in default and the
> Mortgagee is unsuccessful in contacting the Mortgagor by telephone,
> the Mortgagee should perform a visual inspection of the property to
> determine whether it is vacant, and if so, protect and preserve the
> property. In cases where the Mortgagor has filed bankruptcy, and the
> Mortgagee is prohibited from contacting the Mortgagor, supporting
> documentation must be maintained in the claim review file to confirm
> this prohibition.
>
> In such cases, Mortgagees will not be required to conduct interior
> inspections (or perform other preservation and protection actions),
> until such time as there is no longer a stay (prohibition) in place
> barring the Mortgagee from collection activities, or the bankruptcy
> court has granted approval for the Mortgagee to take any required
> preservation and protection actions.
>
> The Mortgagee should take all actions permitted under bankruptcy law
> and should diligently pursue seeking any necessary permission from the
> bankruptcy court to inspect and/or protect and preserve the property
> where no payments are being made and/or there is a suspicion of
> abandonment. HUD will reimburse for such actions, where: 1) the
> Mortgagee learns that the property is or may be vacant, 2) the
> Mortgagor is not performing as required by the bankruptcy court, or 3)
> bankruptcy is no longer a bar to foreclosure, inspection or
> preservation and protection, which includes but is not limited to,
> termination of the automatic stay or the trustee has formally
> abandoned the property or permission is granted.

C.  **[Report Contents]{.underline}**

> The Occupancy Inspection report should, at a minimum include the
> following:

-   Date of the occupancy inspection.

-   Identity of the inspector.

-   Is the property occupied? If so, how was this determined?

-   Identity and status (i.e., Mortgagor, renter, etc.) of occupants, if
    ascertainable

-   A valid telephone number for the occupant, if ascertainable.

-   Is the house locked or secured?

-   Is there a For Sale sign on the property? If so, provide the Broker
    name and contact number.

```{=html}
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-   Is the grass mowed and/or shrubs trimmed?

-   Is there any damage apparent from the exterior? Describe.

-   Is any exterior glass broken? Describe.

-   Are any doors or windows boarded? Describe.

-   Does the house appear to contain personal property and/or debris?

> If the Inspection indicates that a property is occupied, the Mortgagee
> or its agent should attempt to verify the identity of the occupant(s).
> If it is not clear whether a property is occupied, the Mortgagee
> should review such occupancy indicators such as (i) checking utility
> meters to determine if they are on (ii) contacting the listing broker
> if there is a for sale or rent sign on the property (iii) observing
> general maintenance and (iv) speaking to neighbors. A drive-by
> inspection alone is not acceptable evidence of occupancy or vacancy.
> Documentation to support the occupancy determination must be provided
> along with a copy of the inspection report.

**II. [Initial Vacant Property Inspection]{.underline}**

> An Initial Vacant Property Inspection, also called the "Initial
> Inspection", is performed on the date a Mortgagee first takes physical
> possession of a property by securing it. Securing should take place as
> soon as reasonably practical, but no more than five calendar days
> following the determination that the property is vacant and/or
> abandoned post foreclosure or 15 business days following the
> determination that the property is vacant and/or abandoned,
> pre-foreclosure. If the Initial Inspection identifies an imminent
> source of property damage or a health and safety hazard (e.g., flowing
> water, collapsed roof, gas leak), the Mortgagee must take immediate
> action to remediate the damage/hazard. Where emergency permission
> could not be obtained in advance of the repairs, the Mortgagee shall
> submit an over-allowable request immediately following completion of
> the work and substantiate the emergency nature of the repairs.
>
> In some instances the Initial Inspection will take place on the same
> date as the Occupancy Inspection. In these cases, the Mortgagee may
> only claim the cost of the Initial Inspection. The Initial Inspection
> report establishes the condition in which the Mortgagee first found
> the property, and may be of critical importance in distinguishing
> between Mortgagor and Mortgagee neglect, following conveyance.

A.  **[Report Contents]{.underline}**

> Mortgagees should be diligent in documenting property condition
> through written descriptions and photographs during each inspection
> but especially at the Initial Inspection. The Initial Inspection
> report should describe (i) the condition of the property when the
> Mortgagee or its agent arrived; (ii) actions taken by the Mortgagee to
> preserve and protect the property during the initial securing; and
> (iii) required actions to be performed. At a minimum the Initial
> Inspection report should include:

-   Date of the initial vacant property inspection.

-   Identity of the inspector.

-   Date of last occupancy inspection.

-   Is the house locked or secured?

-   Is the grass mowed and/or shrubs trimmed?

-   Is there any apparent damage? Describe.

-   Is any exterior glass broken? Describe.

-   Are there any apparent roof leaks? Describe.

-   Does the house contain personal property and/or debris? List all and
    document with photographs.

-   Are any doors or windows boarded? Describe.

-   Is the house winterized? If not, when and where applicable, initiate
    winterization service (see Attachment 7).

-   Are there any repairs necessary to adequately preserve and protect
    the property? Describe.

-   Which appliances are present?

-   Describe any P&P actions completed during initial securing.

-   Describe any additional P&P actions required.

> **B. [Posting Signage]{.underline}**
>
> During the Initial Inspection, Mortgagees should post a small sign no
> larger than 8.5" x 11" on an interior window or the front door of a
> property. The sign should not include information about pending
> foreclosure or the M&M Contractor, but should contain the Mortgagee's
> toll free telephone number and/or the telephone number of the
> Mortgagee\'s local representative to contact in case of emergency.
> There is no allowable cost to post signs.

**III. [On-Going Vacant Property Inspections]{.underline}**

> On-going Vacant Property Inspections are performed after the Initial
> Inspection and securing have occurred. The Mortgagee should inspect a
> vacant or abandoned property every 25-35 days following an Initial
> Inspection, or more frequently as prescribed in local variations (see
> ***Local Variation from General Requirements,* page 15**), to
> determine whether any subsequent or additional preservation and
> protection action is necessary. Vacant Property Inspections should
> include both interior and exterior assessments of property condition.
>
> At a minimum the Vacant Property Inspection report should include the
> items listed in 2A above.

**IV. [Voluntary Pre-Conveyance Inspections]{.underline}**

> A number of Mortgagees have requested the opportunity to conduct a
> joint property inspection with M&M contractors prior to conveyance.
> HUD encourages, but does not require, Mortgagees or M&M contractors to
> conduct Pre-Conveyance Inspections. Pre-Conveyance Inspections may
> significantly reduce post-conveyance disputes between Mortgagees and
> M&M contractors by allowing each party to agree that properties are in
> conveyance condition or identify additional requirements that should
> be met prior to conveyance. This is especially beneficial when
> properties will be conveyed damaged, as it will allow the Mortgagee to
> demonstrate that the damage is not surchargeable, thereby reducing the
> likelihood of demand letters, re-conveyance, or other sanctions.
>
> Pre-Conveyance Inspections should be scheduled no earlier than five
> calendar days prior to the scheduled conveyance date. HUD will allow
> Mortgagees to claim the cost of one additional inspection, claimed at
> the rate of a Vacant Property Inspection, provided the Pre-Conveyance
> Inspection does not coincide with the regular inspection schedule.
>
> Mortgagees should contact the appropriate M&M contractor directly for
> further information on procedures regarding voluntary Pre-Conveyance
> Inspections in their contract areas. The M&M contractor, using HUD's
> inspection form, will perform voluntary Pre-Conveyance Inspections.
>
> At a minimum the Pre-Conveyance Inspection report should include the
> items listed in 2A above.

**V. [Pre-Eviction Inspections]{.underline}**

> Mortgagees are required to perform a Pre-Eviction Inspection within 72
> hours of a scheduled eviction, whenever there is any doubt that a
> property is still occupied. The Pre-Eviction Inspection will be
> reimbursable as an Occupancy Inspection. When an Occupancy Inspection
> is already scheduled for the same week as the eviction, only one
> inspection fee will be reimbursed. Mortgagees are reminded to confirm
> the scheduled eviction the day before or morning of the scheduled
> eviction to be eligible to claim one hour of labor per person for a
> canceled or rescheduled eviction. Mortgagees should document in the
> claim review file, the name of the person or place called, the date
> and time of the call and results of the call.
>
> At a minimum the Pre-Eviction Inspection report should include the
> items included in the Occupancy Inspection as listed in 1C above.

**VI. [Inspection Cost and Frequency]{.underline}**

> The reimbursable cost limits for Inspections are as follows:

  -----------------------------------------------------------------------
  **Property Inspection Cost Schedule (NATIONWIDE)**

  -----------------------------------------------------------------------

> The cost of inspections is not included in the overall P&P maximum.
> Generally, not more than 15 inspections per calendar year may be
> claimed unless indicated otherwise under local variations. In cases of
> a declared natural disaster see Mortgagee Letter 2005-41.

######## Local Variations from General Requirements {#local-variations-from-general-requirements .unnumbered}

**[ATLANTA Homeownership Center]{.underline}**

**[Chicago, Illinois]{.underline}**

Properties should be inspected twice per week, year-round in the
following zip codes (hot-zones):

60609 60615 60621 60627 60628 60635 60636

60639 60641 60644 60647 60651 60653

**[SANTA ANA Homeownership Center]{.underline}**

**[Alaska]{.underline}**

During all inspections, inspectors should verify that all properties are
winterized and if not notify the servicer to arrange for winterization
immediately as Alaska properties should be winterized year-round.

###### Los Angeles, California {#los-angeles-california .unnumbered}

Properties should be inspected twice per week, year-round in the
following zip codes:

90001 90002 90003 90220 90221

###### ATTACHMENT 3 Lock Changes/Securing Service Requirements and Cost Schedule {#attachment-3-lock-changessecuring-service-requirements-and-cost-schedule .unnumbered}

Properties must be secured to prevent unauthorized entry and protect
against weather related damage. The cost schedule to this attachment
includes a Maximum Allowable Securing Fee for securing that includes the
minimum securing requirements identified in I. below, as well as a flat
fee for photographs. This attachment also identifies maximum allowable
fees for securing swimming pools and completing temporary roof repairs,
which are not included in the Maximum Allowable Securing Fee. The
securing requirements listed below may be performed without prior
approval from the M&M contractor if all individual expenses remain
within the maximum cost allowable for that particular service.

Written approval from the M&M contractor is required if the cost exceeds
the maximum allowable for any particular service listed herein.
Re-securing the property is allowed without prior approval, provided the
costs are within the maximum allowable securing fee.

**I. [Minimum Securing Requirements (Post Foreclosure)]{.underline}**

1.  All windows and doors must be secured.

2.  Broken glass should be replaced, unless the opening is to be
    boarded. All broken glass should be removed.

3.  Locks on the front and rear entry doors should be replaced with one
    of the following master lock sets:

    -   Kwikset No. 400T

    -   Kwikset No. 400P

    -   Kwikset No. 400V or equivalent, with identical key codes.

4.  If there is a deadbolt lock on the main entry door replace handle
    set with a Kwikset lock or equivalent and disable the existing
    deadbolt.

5.  Other entryways that provide immediate access to the living area,
    attached garage or basement area should be secured with a slide
    bolt, unless otherwise noted in variations. Or, if the secondary
    entryway has an existing deadbolt lock, re-key the deadbolt to the
    specifications of the front and rear entry doors.

6.  Document key-codes to the existing/replacement lock in the
    Mortgagee's Comments section of form HUD-27011 Part A, which must be
    provided to the M&M contractor.

7.  Doors and windows should not be braced or nailed shut or the
    Mortgagee will be held accountable for resulting damage. Replace
    locking mechanism on windows if inoperable or missing.

8.  Sliding glass doors should be double locked.

9.  Detached garage doors and outbuildings should be secured with a
    padlock and hasp.

10. Unplug automatic garage door openers and secure garage doors, when
    applicable. Garage doors should be left in such a condition as to
    allow for opening and closing without the use of the automatic
    garage door opener. Leave the remote key(s)/transmitter(s) in a
    kitchen counter drawer.

[Minimum Securing Requirement (Pre-Foreclosure)]{.underline}

1.  At a minimum the Pre-foreclosure securing requirements should
    include the items listed in "I" above, except the rear entry door
    lock must not be changed to allow borrower access, if applicable.

**II. [Temporary Roof Repair]{.underline}**

> Roof damage left unattended exposes a property to deterioration;
> moisture accumulation and mold growth. A separate cost item in the
> amount of \$400 has been created for temporary roof repair to protect
> the interior of properties from further damage. M&M approval is not
> required if the cost of the temporary repair does not exceed the
> maximum allowable amount of \$400. The Mortgagee should submit form
> HUD-50002, "Re*quest to Exceed Cost Limits for Preservation and
> Protection,"* for any temporary roof repair that exceeds the maximum
> allowable for roof repair. Temporary repairs (e.g.,
> tarping/patching/or replacing loose shingles) should be performed
> immediately upon discovery of roof damage. Tarps and other temporary
> measures may be used to prevent further deterioration only until
> permanent repairs can be completed.
>
> If a property has sustained roof damage that is not surchargeable and
> the property is scheduled for conveyance within 30 days of the date a
> roof leak is discovered, the Mortgagee may convey the property with a
> tarp or other temporary repair. Mortgagees should notify the M&M in
> advance when they will convey a property with a temporary repair and
> should provide evidence that the damage is not surchargeable and was
> only recently discovered. Failure to provide this notification may
> result in re-conveyance.
>
> If the damage is discovered 31 or more days prior to the conveyance
> date, the Mortgagee should affect a permanent roof repair, whether or
> not the damage is surchargeable. If the cost to permanently repair the
> roof exceeds the cost allowable for this item, the Mortgagee should
> submit an over-allowable request.
>
> Properties with surchargeable roof damage may not be conveyed with a
> tarp or other temporary repair without the prior approval of the M&M
> contractor.
>
> Mortgagees should retain before and after photographs and a detailed
> description of what actions were taken to prevent further roof
> deterioration or water leakage. The documentation must be maintained
> in the claim review file to support the reimbursement of the costs
> claimed.

**III. [Swimming Pools]{.underline}**

> Fees for securing or winterizing swimming pools and hot tubs or spas
> are not included in the maximum allowable limit per property. See
> below for the maximum costs for securing pools and spas. The costs for
> permits to drain pools/spas by local governments are included in the
> maximum limit for this cost item and will be reimbursed based on the
> actual cost incurred. Prior written approval from the M&M contractor
> is not required for securing or winterizing pools unless noted
> otherwise in variances below. Before and after photographs are
> required. At a minimum the Mortgagee should:

-   Pump out pool leaving 4 feet of water in the deep end (this amount
    may vary depending on the elevation). After pumping, apply chlorine
    to control the algae in the remaining water. Circulate remaining
    water to mix chlorine. Isolate and drain pumps and filters. Remove
    all trash from interior of pool and haul away.

-   If there is a pool cover present, secure and cover pool. Check with
    state and local codes to verify whether the pool should be fenced.

-   If there are no jurisdictional requirements, and no existing pool
    cover, secure according to the diagram on page 20. However, no pool
    cover is required in Arizona, California, Hawaii, Nevada and Other
    Pacific Islands.

```{=html}
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```
-   Secure entrance gates to fences surrounding pools with a lock or
    padlock and chain when no lock is present.

-   Replace any damaged or missing boards or sections of fence
    surrounding pools.

> If the property has an above ground pool in good condition, built up
> with decking or other infrastructure that will support a pool cover,
> treat it as an in-ground pool. Above ground pools in poor condition or
> that cannot be secured in accordance with the guidelines herein,
> should be removed. If an above ground pool is removed, remediate any
> depression in the ground that might constitute a hazard.
>
> **[WARNING]{.underline}:** Check local area standards before draining
> pool. In areas where there is a high ground water level, removing too
> much water may cause pool uplift and damage the pool.

**IV. [Photographs]{.underline}**

> Effective for all claims filed 30 days from the date of this Mortgagee
> Letter, preservation and protection actions should be documented using
> digital photography. Rather than establishing a maximum allowable
> number of photographs and reimbursing Mortgagees on a per picture
> basis, HUD will provide a flat fee reimbursement of \$30.00 for
> photographs, regardless of the number of pictures required. The
> photographic fee is included in the lock change/securing maximum
> allowable cost per property.
>
> Photographs are required to document inspections, initial property
> condition, one-time securing service, boarding, yard maintenance,
> debris removal, winterization and personal property/debris removal as
> part of an eviction. The Mortgagee should photograph the exterior and
> interior of the property at the time of the Initial Inspection. All
> photographs should be dated, labeled and maintained in the Mortgagee's
> claim review file and made available to HUD or its M&M contractor upon
> request. If photographs cannot be produced at the time of the claim
> review, the following will be disallowed:

a.  All unsupported expenses

b.  All expenses claimed for personal property/debris removal including
    evictions

```{=html}
<!-- -->
```
V.  **[Lock Change/Securing Service Costs]{.underline}**

> The reimbursable cost limits for Lock Change/Securing Service are as
> follows:

  -----------------------------------------------------------------------
  **Lock Change/Securing Service Cost Schedule (NATIONWIDE)**

  -----------------------------------------------------------------------

######## Local Variations from General Requirements for Securing Pools and Spas {#local-variations-from-general-requirements-for-securing-pools-and-spas .unnumbered}

**[ATLANTA Homeownership Center]{.underline}**

**[Indiana]{.underline}**

Use 1", 2", or 3" x 4" hex netting to cover pool. Seams should be
covered with 1" wood strips for securing.

**[SANTA ANA Homeownership Center]{.underline}**

**[Arizona/California/Hawaii/Nevada/Other Pacific Islands]{.underline}**

Do not cover pools. However, pools should be drained and secured
according to the guidelines set forth on page 20.

########  {#section .unnumbered}

![](media/image1.png)

######  {#section-1 .unnumbered}

***Add cross bars every 16" on center to framing for added strength and
support.***

###### ATTACHMENT 4 Boarding Service Requirements and Cost Schedule {#attachment-4-boarding-service-requirements-and-cost-schedule .unnumbered}

Mortgagees should not board a property unless they have prior written
approval from the M&M contractor, and/or:

-   The property is severely damaged by fire, flood or other natural
    disaster;

-   The property should be secured for safety reasons;

-   The property is in a high vandalism area and boarding is the only
    reasonable means to protect the security of the property;

-   The property is located in a pre-approved boarding area.

When boarding is appropriate, all first floor windows and doors and all
basement windows and doors should have plywood covering the entire
opening and frame. The covering should be secured with carriage bolts.
Eliminate any health and safety hazard caused by any protruding bolts
used to secure boarding. The use of nails is prohibited. The cost of
boarding properties is not included in the maximum allowable limit per
property. Before and after photographs are required. HUD will not
reimburse the Mortgagee for unauthorized boarding. Mortgagees should
request prior written approval from the M&M contractor if the cost of
securing a severely damaged property exceeds \$550.

There should be no boarding above the first floor unless entry is
possible without use of a ladder, and the opening is large enough for a
person to easily pass through. Openings above the first floor that do
not meet this test should be secured but not boarded. Second story and
higher openings are typically accessible only from attached properties,
stairwells or fire escapes. If security bars are located on
windows/doors, boarding is not required. Openings too small for a person
to pass through, particularly pet openings in doors, should be secured
but not boarded. To ensure that no hazards exist, remove all broken
glass from the windows and surrounding interior and exterior areas.

All properties should be boarded in accordance with local codes. If
local codes differ from HUD requirements herein, local codes supersede.

For the purpose of this document, the definition of united inch is
length plus width.

**I. [Specifications for Plywood Boarding]{.underline}**

1.  Exterior Plywood should be of un-sanded CDX grade.

2.  Plywood thickness should be 1/2" for window openings, 5/8" for door
    openings and 3/4" for sliding door and French door openings. When
    extra large window openings are encountered use 5/8" or 3/4" as
    necessary.

3.  All holes should be drilled to accommodate bolts. The holes in the
    top of the plywood should be 12" down from the top and 20% of the
    width of the plywood cover, in from the side.

4.  The holes in the bottom should be 25% of the height of the plywood,
    up from the bottom and the same distance in from the side as the
    top.

5.  Carriage bolts mated with nut and two three inch flat washers as
    shown in the side view. Washers to be of sufficient size to fully
    accept the square portion of bolt beneath head. Bolt and mating
    hardware may be galvanized or cadmium plated. 3/8" x 12" bolts
    should be supplied with each 2'8' door, 3'0" door, and glass sliding
    door cover. 3/8 x 10" bolts should be supplied with the rest.

6.  2" x 4" lumber should be graded and should be a minimum of 16"
    longer than the width of the plywood cover. (Note: 2x4s will be
    drilled with 1/2" diameter holes that line up with the holes in the
    plywood covers.)

7.  All windows and doors, except the front door, through which access
    to the interior of the dwelling is made, should be secured. All
    window boards will be cut to fit inside the concrete block or brick
    opening with a maximum 1/8" clearance. THE PLYWOOD COVERING SHOULD
    BE OF ONE CONTINUOUS PIECE WHEN POSSIBLE.

8.  All fabricated parts and ancillary materials become property of the
    Department of Housing and Urban Development.

9.  All coverings are to be fabricated according to the attached drawing
    and specifications.

**II. [Boarding Windows]{.underline}**

1.  Except as noted below, all window sashes, frames, glass and hardware
    are to be undamaged by the boarding installation.

2.  All screen inserts are to be removed, marked as to location and
    stored in a convenient closet or in the utility room.

3.  In all cases where it is possible to adjust the position of the
    sashes to accommodate the specifications for boarding above, the
    sashes are to remain in the frame.

4.  In instances wherein the sashes cannot be adjusted to accommodate
    the boarding specifications above, the sashes are to be removed from
    the frames and stored in a convenient closet or in the utility room.
    This includes all stationary lights secured by stops.

5.  In cases wherein the sash cannot be removed and/or the frame is
    permanently built into the house and cannot be removed (i.e.,
    Fenestra windows) it will be necessary to break the corner panes to
    accommodate the boarding and bolts. If the location of bolt holes,
    in the plywood, requires modification because of the muntin bar (a
    small bar that divides a windows glass), these locations are to be
    modified. In no case, in any type of window, is any sash or frame
    part to be damaged.

6.  In all instances where items should be removed from the frame and
    stored, the items should be clearly marked as to the area from which
    it was removed.

7.  All items are to be stored on edge and braced to prevent accidental
    tipping, sliding, etc. In no instance is any item to be stored laid
    flat.

8.  Hinged windows are to be completely removed from the frame and
    stored as stated in (7) above. If possible the hinge pins are to be
    removed and remain with the removed item.

9.  Faced nailing of panels to wood frame windows is prohibited.

**Note: Costs below are per United Inch. Definition - United Inch equals
length plus width.**

  -----------------------------------------------------------------------
  **Boarding Cost Schedule (NATIONWIDE)**

  -----------------------------------------------------------------------

  ---------------- ---------------- ------------------ ------------------
  **Boarding       **Boarding       **Boarding 3/4\"** **Screening**
  1/2\"**          5/8\"**                             

  \$0.80           \$0.90           \$1.00             \$0.55
  ---------------- ---------------- ------------------ ------------------

####### Local Variations from General Requirements {#local-variations-from-general-requirements-1 .unnumbered}

########  {#section-2 .unnumbered}

**[ATLANTA Homeownership Center]{.underline}**

**[Illinois]{.underline}**

Install cloth screening. Cloth screen first floor openings in zip codes:

60429 60426 60411 60466 60477 60443

Screening of wood windows is accomplished by framing the window with
2x2s. The screening is stapled over the frame and fastened with 1x2
furring laths.

**[Chicago, Illinois]{.underline}**

Install Plywood boarding in the following pre-approved Chicago zip code
areas following the Chicago boarding requirements below.

60608 60609 60610 60612 60615 60616

60617 60619 60620 60085 60621 60622

60623 60624 60627 60628 60636 60637

60643 60644 60649 60651 60653

**Rule 1.** All openings in a structure which may be accessed from
ground level and/or within 8 feet in any direction of an exterior
stairway, fire escape, ramp, porch or other exterior construction
reachable from ground level or a public way should be secured to prevent
entry by unauthorized persons. One building entrance should be secured
with a door of either solid core wood or steel construction, having no
window in the door, and the door should be securely locked to allow
access only to authorized persons. Said door should be secured with a
through-bolted hasp and padlock if the door swings in.

**Materials**

**Rule 2.** If plywood materials are used to secure buildings, such
materials should be no less than 5/8-inch thick, exterior grade.
Particleboard, wafer board, masonite or other similar materials should
not be used for purposes of boarding-up a building.

**Rule 3.** Mechanical fasteners used for wood board-up materials should
be round-head non-slotted carriage bolts no less than 3/8-inch in
diameter with washers and nuts on the interior face.

**Installation Methods**

**Rule 4.** The primary method of securing plywood boards should be by
the use of through-bolt compression fastening, using plywood on the
exterior face and wood bracing constructed of minimum 2-inch by 4-inch
(nominal) lumber installed on the interior side of the opening to be
secured, perpendicular to the long dimension of the opening. Such
bracing should extend at least 6 inches beyond the edge of the opening
on each side in order to be securely braced against the building
structure.

**Rule 5.** Wood construction used to secure a building opening should
contain at least one bolt in each corner and additional bolts no more
than four feet on center continuously along the perimeter. Each bolt
should fully penetrate the wood bracing on the interior side of the
opening.

**Rule 6.** In the event that the through-bolt compression fastening is
impossible due to the construction or condition of the opening, the
opening should be covered with plywood secured with minimum 3-inch-long
wood screws fastened on 4-inch centers around the circumference of the
opening.

**[Florida]{.underline}**

Boarding is pre‑approved in the following zip code areas:

[Miami:]{.underline}

33004 33009 33010 33012 33013 33014

33020 33023 33034 33054 33055 33056

33060 33069 33122 33125 33127 33128

33130 33131 33132 33136 33137 33138

33142 33147 33150 33157 33161 33167

33168 33169 33170 33177 33181 33190

33311 33315 33316 33401 33403 33404

33405 33407 33426 (east of 1‑95) 33435 33441

33444 33460 33462 (east of 1‑95)

Exterior surface and edges of all plywood should be painted with one
coat white primer and one cost white finish. Use of screws to secure
panels to wood frame windows is prohibited. See plywood-boarding diagram
on **page 27**.

**[Caribbean]{.underline}**

Exterior surface and edges of all plywood should be painted with one
coat white primer and one coat white finish. Use of screws to secure
panels to wood frame windows is prohibited. Additionally, boarding is
pre‑approved in the following zip code areas:

00923 00924 00929 00601 00602 00603

00703 00704 00705 00610 00612 00714

00616 00617 00794 00915 00956 00957

00959 00961 00622 00623 00725 00627

00729 00920 00921 00979 00982 00983

00985 00986 00987 00962 00736 00735

00935 00638 00739 00769 00782 00907

00783 00780 00926 00646 00647 00738

00650 00934 00652 00653 00784 00656

00965 00966 00967 00968 00969 00970

00971 00778 00659 00917 00660 00791

00662 00913 00664 00795 00777 00667

00669 00670 00771 00772 00911 00773

00674 00909 00606 00707 00680 00715

00676 00687 00718 00719 00720 00723

00624 00716 00717 00728 00730 00731

00734 00740 00741 00678 00677 00745

00925 00926 00927 00637 00688 00952

00751 00690 00683 00685 00757 00907

00909 00911 00912 00913 00953 00949

00976 00641 00692 00693 00901 00765

00766 00767 00698

EXCEPTION: There is no pre-approved boarding in ANY gated community
within these zip code areas.

**[PHILADELPHIA Homeownership Center]{.underline}**

**[Connecticut]{.underline}**

Boarding pre‑approved in the following zip codes areas for the cities
of:

[Bridgeport]{.underline}: 06601 06604 06605 06606 06607 06608 06610
06611

06612 06614 06615 06650 06673 06699

[New Haven]{.underline}: 06501 06502 06503 06504 06505 06506 06507 06508

06509 06510 06511 06512 06513 06514 06515 06516

06517 06518 06519 06520 06521 06524 06525 06530

06531

**[Massachusetts]{.underline}**

Boarding pre‑approved for the following zip code areas:

[Boston]{.underline}: 02108, 02109, 02110, 02118, 02119, 02120, 02121,
02122,

> 02124, 02125, 02126, 02127, 02128, 02130, 02131, 02136

[Brocton]{.underline}: 02401, 02402

[Lawrence]{.underline}: 01840, 01841, 01842, 01843, 01845

[Lynn]{.underline}: 01902, 01903, 01904, 01905

**[New Jersey]{.underline}**

Boarding is pre-approved for the following zip code areas for the cities
of:

[Asbury Park]{.underline}: 07712

[East Orange]{.underline}: 07017 07018 07019

[Elizabeth]{.underline}: 07201 07202 07206 07208

[Irvington]{.underline}: 07111

[Jersey City]{.underline}: 07302 07304 07305 07306 07307 09308 07309
07310

> 07311 07395 07399

[Long Branch]{.underline}: 07740

[Newark]{.underline}: 07101 07102 07103 07104 07105 07106 07107 07108

07112 07114 07175 07182 07184 07188 07189 07191

07192 07193 07194 07195 07197 07198 07199

[New Brunswick]{.underline}: 08901 08902 08903 09804 08905 08906 08922

08933 08988 08989

[Patterson]{.underline}: 07501 07502 07503 07504 07505 07506 07507 07508
07509 07510 07511 07512 07513 07514 07522 07524

> 07533 07538 07543 07544

[Plainfield]{.underline}: 07060 07061 07062 07063 07069

Boarding is pre-approved for the following zip code areas:

08016 08066 08096 08618 08608

08101 08102 08103 08104 08105

08232 08609 08610 08611 08611

08312 08302 (Bridgeton only) 08360 (Vineland only)

08401 08406 (Ventnor only) 08110 (Pennsauken only)

08600 08332 (Mellville only) 08650 (Trenton only)

**[New York, New York]{.underline}**

Board all properties within the city limits of the five boroughs in New
York City without pre-approval with the exception of Dutchess, Putnam,
and Rockland Counties.

**[Rhode Island]{.underline}**

Boarding is pre‑approved for the following zip code areas in the cities
of:

[Providence]{.underline}: 05901 02902 02903 02904 02905 02906 02907

02908 02909 02910 02911 02912 02918 02919

02940

[Cranston]{.underline}: 02823 02905 02907 02910 02920 02921

**[Pennsylvania]{.underline}**

Boarding is pre‑approved for the following zip codes.

17509 17512 17516 17517 17518 17527

17532 17536 17547 17550 17560 17563

17565 18101 18102 18103 18115 18117

19013 19023 19320 19335 19380 19401

19464

**[SANTA ANA Homeownership Center]{.underline}**

**[Long Beach, California]{.underline}**

Properties should be secured with window screens and security doors
only. Do not use plywood boarding material to secure window openings.
See diagrams and specifications on pages 30-31.

![](media/image2.png)

![](media/image3.png)

![](media/image4.png)

![](media/image5.png)

![](media/image6.png)

###### ATTACHMENT 5 Debris Removal Service Requirements and Cost Schedule {#attachment-5-debris-removal-service-requirements-and-cost-schedule .unnumbered}

A Mortgagee may expend up to the amount listed in this attachment for
debris removal without prior written approval from the M&M contractor.
Costs such as labor hours, dump fees, and transportation (e.g., fuel,
mileage, truck rental) should not be claimed in addition to the
reimbursable amount as these costs are incorporated in the per unit
allowable cost for debris removal. Before and after photographs are
required.

The Department acknowledges that it is a common business practice of
many property preservation contractors to wait until they have collected
debris from several properties before taking the debris to an
appropriate facility for disposal and that not all disposal facilities
provide printed receipts. Therefore, where such receipts are not
available, Mortgagees will not automatically be denied reimbursement for
debris removal. However, the Department must be able to confirm the type
and amount of debris that was removed and that all debris was disposed
of properly. Therefore, Mortgagees must maintain [a complete audit
trail]{.underline} which will include: the name, address, and phone
number of each company providing the debris removal service, the FHA
case number and address of the property, the date of the disposal, the
number of cubic yards of debris disposed and a listing of any items that
are not ordinary household debris which would include health and safety
items, tires, appliances, cars, trucks, boats, batteries, etc. The
documentation must also provide the name, address and telephone number
of all disposal facilities used.

If a dumpster was brought to the property, the supporting information
must identify the date the dumpster was delivered to the property, the
date it was removed, and the name, address and telephone number of the
company supplying the dumpster.

###### Exterior 

> Mortgagees should remove all exterior debris, including abandoned
> vehicles, in accordance with applicable local laws. Items of personal
> property that are securely affixed and in good condition, such as a
> swing set or dog-house/kennel should not be removed if they add value
> to the property. However, if personal property is in disrepair or
> determined to be a health and safety hazard, it should be removed.
>
> Mortgagees must maintain, in the claim file, salvage yard and dump fee
> receipts that substantiate all claimed debris removal. The
> documentation must include the date, address of the property(s) for
> which the debris is being dumped, number of yards dumped, and the
> number and type of appliances (e.g., refrigerators, stoves,
> dishwashers) being dumped or disposed. The receipt must indicate the
> name of the dump to verify that the debris has been disposed of
> legally.
>
> Before and after photographs are required to support all required
> debris removal. Photographs should be dated and the property address
> indicated. If photographs are not available as documentation of
> required debris removal, HUD will not reimburse the Mortgagee for
> associated costs.

**II. [Interior (Including Attic, Basement, and Storage
Spaces)]{.underline}**

> Mortgagees are not to remove interior debris except for:

-   Debris that constitutes a health or safety hazard;

-   Debris that has or is likely to result in issuance of a code
    violation, a fine and/or lien;

-   Debris required to be removed as part of an eviction by local law
    enforcement or crews under the control and direction of local law
    enforcement where the Mortgagee has no control over the timing of
    removal.

If the clean‑out of a property's interior is necessary, the clean-out
should include removal and proper disposal of debris including:

-   Shabby or torn carpet;

-   Dilapidated, unsafe flooring;

-   Health and safety hazards (See *Hazardous Waste Removal*, below),
    including dead animals; and personal effects (e.g., furniture,
    clothing, dishes, utensils), unless otherwise instructed by local
    law enforcement during an eviction.

    Before and after photographs are required to document the existence
    of personal property items and all required debris removal.
    Photographs should be dated and the property address indicated. If
    photographs are not available as documentation of required debris
    removal, HUD will not reimburse the Mortgagee for associated costs.

########  {#section-3 .unnumbered}

###### III. Hazardous Waste Removal {#iii.-hazardous-waste-removal .unnumbered}

> Mortgagees are required to remove unhealthy or hazardous materials
> from the exterior and interior of properties prior to conveyance and
> should adhere to local municipal health and safety requirements with
> respect to proper disposal of said materials. For additional
> clarification, the Environmental Protection Agency (EPA) website lists
> common household items containing potentially hazardous ingredients
> that might be found in a garage, basement, or other storage space
> (<http://www.epa.gov/epaoswer/non-hw/muncpl/hhw-list.htm>). Further,
> as a matter of health and safety, refrigerators should be unplugged
> and refrigerator doors should be removed and stored if required by
> applicable state or local law or ordinance.
>
> Materials considered unhealthy or hazardous that should be removed
> prior to conveyance include but are not limited to:

-   Decaying food or other organic matter;

-   Dead animals and animal feces;

-   Pest infestations (see below);

-   Broken glass or other sharp objects;

```{=html}
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```
-   Large containers of liquids;

-   Large quantities of paint or paint products;

-   Paints or solvents in any amount stored in or near papers, fabrics
    or other flammable materials; and

-   Highly flammable chemicals (e.g., solvents, paint thinners,
    gasoline, motor oil and motor additives, etc.).

> The following products, if found in quantities consistent with normal
> household use, are not considered hazardous waste for purposes of
> debris removal under this section.

-   Non-flammable materials including reasonable quantities of paper and
    fabrics (unless stored near flammable chemicals);

-   Common cleaning products and household chemicals such as insect
    repellent;

-   Up to five gallons of paint and paint products;

-   Lawn and garden products and fertilizers; and

-   Pool chemicals.

> EPA guidelines allow paint cans to be disposed of with regular debris,
> once treated. Paint is treated by brushing the paint onto cardboard or
> newspaper, allowing the empty can to dry with the lid off, or by
> adding absorbent material such as kitty litter, shredded newspaper,
> sand, or sawdust directly into the latex paint can. Dried paint may
> then be thrown in the trash and removed from the property as regular
> debris.
>
> The M&M contractor must approve any costs associated with disposal
> action(s) required by a municipality.

########  {#section-4 .unnumbered}

######## IV. Bug and/or Pest Infestation {#iv.-bug-andor-pest-infestation .unnumbered}

> If, on the initial inspection, the Mortgagee finds evidence of pests
> (e.g., roaches, water bugs, mice, rats) that does not prevent
> clean-out of debris or is not a health or safety hazard, the Mortgagee
> may use over-the-counter products to exterminate the bugs. If the
> property is found to be infested with pests that constitute a health
> or safety hazard or prevent the clean-out or debris removal, the
> Mortgagee may utilize a professional Pest Control Service. A flea
> infestation does not require photographic evidence.

###### V. Personal Property and Debris Removal during Evictions  {#v.-personal-property-and-debris-removal-during-evictions .unnumbered}

> Some jurisdictions require a legal eviction to remove personal
> property from a vacant house. Mortgagees should follow local code and
> laws and exercise good judgment when distinguishing between personal
> property and debris. If Mortgagees have questions regarding personal
> property and debris, they should consult local counsel. If a Mortgagee
> is required by local law to remove trash and debris from the property
> as part of an eviction and the Mortgagee has no control over the
> timing of removal, the costs for removing the items are considered
> eviction expenses and are not subject to the debris removal cost
> guidelines, the maximum securing fee or the overall allowable cost
> limit. These costs are to be claimed as man-hours and should be deemed
> by the M&M contractor to be reasonable and customary for services
> performed in the area.

**A**. **[Personnel]{.underline}**

> In most circumstances, no more than four people should be necessary to
> complete an eviction for a townhouse or condominium and six people for
> a single family detached dwelling. If local law provides that a
> specific number of people should be provided, or if the law
> enforcement official conducting the eviction identifies a need for
> additional people to be present at the time of the eviction, this
> information must be documented in the claim review file. Similarly, if
> local or state law requires that a service be performed within a
> certain time frame or subject to specific removal or storage
> requirements, those requirements must be fully documented in the claim
> review file and costs are not subject to the allowable cost limit for
> the jurisdiction.
>
> The removal of curbside debris following an eviction will be
> reimbursed as man-hours. No more than four man-hours at \$20 per
> man-hour, per person at the scheduled eviction will be reimbursed for
> the removal and disposal of eviction debris. Dump fees and storage
> fees (as appropriate for the jurisdiction) will also be reimbursed.
>
> If crews show up for canceled or re-scheduled evictions, the Mortgagee
> is only eligible to claim a maximum of one man-hour at \$20 of labor
> per person.

B.  **[Photographic Evidence]{.underline}**

> Photographs are required to support all personal property/debris
> removed from a property as part of an eviction. Eviction costs should
> be entered in item 305 of Part D of the claim form.

###### VI. Over-allowable Requests for Debris Removal Services {#vi.-over-allowable-requests-for-debris-removal-services .unnumbered}

> Mortgagees should obtain prior written approval from the M&M
> contractor for any debris removal expense that exceeds the cost per
> cubic yard or the total allowable number of yards indicated in the
> schedule. When requesting approval to exceed the debris removal cost
> limit, the Mortgagee should obtain two independent competitive bids.
> If the Mortgagee utilizes a field service company, that firm may
> provide one of the bids. The Mortgagee should obtain a second
> independent and competitive bid and submit the bids to the appropriate
> M&M contractor with an over-allowable request. Field service companies
> or contractors may not submit second bids directly to the M&M
> contractor. This violates the integrity of HUD's requirement for an
> independent and competitive bid process.
>
> The bids should specify the types and location of the debris, the
> number of cubic yards, and include photographic documentation. Any
> additional costs of non-general refuse should be factored into the
> final bid and clearly indicated for M&M contractor review. All second
> bids will be on the bidding company's letterhead and will include the
> bidder's name, address and telephone number. Upon receipt of the bids,
> the Mortgagee should date stamp them and attach them to a [***Request
> to Exceed Cost Limit for Preservation and
> Protection***](http://www.hudclips.org/sub_nonhud/html/pdfforms/50002.pdf).
> Additionally, the Mortgagee should identify all other preservation and
> protection expenses to-date so that the M&M contractor will know if
> and by how much the Mortgagee will exceed the maximum allowable cost
> limit. Debris removed per local code is also subject to the
> established cost limits on debris removal. Mortgagees will not be
> reimbursed for the cost of obtaining bids.
>
> Upon receipt of the required bids, the M&M contractor will, within
> five business days, take one of the following actions:

1.  Notify the Mortgagee to accept one of the bids submitted;

2.  Reject both bids and provide the Mortgagee with examples of similar
    work that has been recently performed at a more reasonable cost, or

3.  Notify the Mortgagee to convey the property without removing the
    debris.

  --------------- -------- ------- ------- --------- --------- ----------- ----------- ----------- ---------
  **Debris                                                                                         
  Removal Service                                                                                  
  Schedule**                                                                                       

  **State**       **Per    **Max 1 **Max 2 **Max 3   **Max 4   **Large     **Vehicle   **Pest      **Tires
                  Cubic    Unit 12 Units   Units 18  Units 21  Appliance   Removal**   Infest.**   \***
                  Yard**   cu      15 cu   cu yd**   cu yd**   Removal**                           
                           yd.**   yd**                                                            

  Alabama         \$45     \$540   \$675   \$810     \$945     \$140       \$180       \$150       \$15

  Alaska          \$35     \$420   \$525   \$630     \$735     \$95        \$125       \$75        \$15

  Arizona         \$35     \$420   \$525   \$630     \$735     \$95        \$215       \$75        \$15

  Arkansas        \$35     \$420   \$525   \$630     \$735     \$113       \$215       \$125       \$15

  California      \$40     \$480   \$600   \$720     \$840     \$88        \$120       \$75        \$15

  Colorado        \$40     \$480   \$600   \$720     \$840     \$100       \$160       \$125       \$15

  Connecticut     \$55     \$660   \$825   \$990     \$1155    \$155       \$210       \$110       \$15

  Delaware        \$55     \$660   \$825   \$990     \$1155    \$110       \$215       \$110       \$15

  District of     \$55     \$660   \$825   \$990     \$1155    \$100       \$215       \$110       \$15
  Columbia                                                                                         

  Florida         \$45     \$540   \$675   \$810     \$945     \$100       \$180       \$170       \$15

  Georgia         \$50     \$600   \$750   \$900     \$1,050   \$140       \$205       \$113       \$15

  Guam            \$40     \$480   \$600   \$720     \$840     \$88        \$125       \$10        \$15

  Hawaii          \$35     \$420   \$525   \$630     \$735     \$88        \$125       \$10        \$15

  Idaho           \$40     \$480   \$600   \$720     \$840     \$75        \$165       \$75        \$15

  Illinois        \$40     \$480   \$600   \$720     \$840     \$125       \$155       \$140       \$15

  Indiana         \$60     \$720   \$900   \$1,080   \$1260    \$55        \$95        \$140       \$15

  Iowa            \$35     \$420   \$525   \$630     \$735     \$50        \$115       \$100       \$15

  Kansas          \$35     \$420   \$525   \$630     \$735     \$40        \$140       \$100       \$15

  Kentucky        \$50     \$600   \$750   \$900     \$1050    \$165       \$215       \$20        \$15

  Louisiana       \$50     \$600   \$750   \$900     \$1,050   \$82        \$170       \$100       \$15

  Maine           \$50     \$600   \$750   \$900     \$1,050   \$195       \$210       \$110       \$15

  Maryland        \$55     \$660   \$825   \$990     \$1,155   \$195       \$215       \$110       \$15

  Massachusetts   \$50     \$600   \$750   \$900     \$1,050   \$195       \$210       \$110       \$15

  Michigan        \$50     \$600   \$750   \$900     \$1,050   \$135       \$240       \$50        \$15

  Minnesota       \$40     \$480   \$600   \$720     \$840     \$75        \$125       \$150       \$15

  Mississippi     \$55     \$660   \$825   \$990     \$1,155   \$140       \$215       \$45        \$15

  Missouri        \$35     \$420   \$525   \$630     \$735     \$150       \$140       \$75        \$15

  Montana         \$50     \$600   \$750   \$900     \$1,050   \$150       \$160       \$75        \$15

  Nebraska        \$35     \$420   \$525   \$630     \$735     \$63        \$115       \$125       \$15

  Nevada          \$40     \$480   \$600   \$720     \$840     \$75        \$165       \$75        \$15

  New Hampshire   \$50     \$600   \$750   \$900     \$1,050   \$155       \$210       \$110       \$15

  New Jersey      \$50     \$600   \$750   \$900     \$1,050   \$140       \$210       \$110       \$15

  New Mexico      \$40     \$480   \$600   \$720     \$840     \$150       \$160       \$125       \$15

  New York        \$45     \$540   \$675   \$810     \$945     \$105       \$140       \$110       \$15

  North Carolina  \$55     \$660   \$825   \$990     \$1,155   \$130       \$230       \$35        \$15

  North Dakota    \$40     \$480   \$600   \$720     \$840     \$75        \$125       \$125       \$15

  Ohio            \$40     \$480   \$600   \$720     \$840     \$105       \$130       \$110       \$15

  Oklahoma        \$35     \$420   \$525   \$630     \$735     \$100       \$190       \$40        \$15

  Oregon          \$40     \$480   \$600   \$720     \$840     \$25        \$125       \$10        \$15

  Pennsylvania    \$50     \$600   \$750   \$900     \$1,050   \$50        \$210       \$110       \$15

  Puerto Rico     \$50     \$600   \$750   \$900     \$1,050   \$130       \$190       \$35        \$15

  Rhode Island    \$50     \$600   \$750   \$900     \$1,050   \$195       \$210       \$110       \$15

  South Carolina  \$55     \$660   \$825   \$990     \$1,155   \$30        \$235       \$75        \$15

  South Dakota    \$45     \$540   \$675   \$810     \$945     \$32        \$190       \$125       \$15

  Tennessee       \$50     \$600   \$750   \$900     \$1,050   \$135       \$195       \$20        \$15

  Texas           \$45     \$540   \$675   \$810     \$945     \$75        \$190       \$125       \$15

  Utah            \$40     \$480   \$600   \$720     \$840     \$90        \$195       \$100       \$15

  Vermont         \$50     \$600   \$750   \$900     \$1,050   \$195       \$215       \$110       \$15

  Virginia        \$55     \$660   \$825   \$990     \$1,155   \$70        \$230       \$110       \$15

  Virgin Islands  \$50     \$600   \$750   \$900     \$1,050   \$130       \$190       \$35        \$15

  Washington      \$35     \$420   \$525   \$630     \$735     \$40        \$115       \$51        \$15

  West Virginia   \$50     \$600   \$750   \$900     \$1,050   \$125       \$240       \$60        \$15

  Wisconsin       \$40     \$480   \$600   \$720     \$840     \$150       \$115       \$100       \$15

  Wyoming         \$45     \$540   \$675   \$810     \$945     \$77        \$190       \$75        \$15
  --------------- -------- ------- ------- --------- --------- ----------- ----------- ----------- ---------

**\*Reimbursement is per tire. If there are more than 6 tires, contact
the M&M contractor**

###### ATTACHMENT 6 Yard Maintenance and Snow Removal Requirements and Cost Schedule {#attachment-6-yard-maintenance-and-snow-removal-requirements-and-cost-schedule .unnumbered}

**I. [Grass Cuts]{.underline}**

> Lawn cutting (initial and subsequent cuts) includes mowing the lawn,
> weeding, edge trimming, sweeping of all paved areas (sidewalks,
> driveways, patios, etc.), and removal of all lawn clippings, related
> cuttings, and incidental debris (newspapers, flyers, bottles, etc.).
> These services are included in the cost allowable for an initial cut
> and subsequent cut (re-cut). The disposal of all clippings and
> incidental debris should be in compliance with jurisdictional
> requirements. The costs allowable for trimming shrubs and snow removal
> are listed separately in the accompanying schedule. Before and after
> photographs are required for all cuts. All photographs should be
> dated.
>
> Mortgagees should not order lawn maintenance if a homeowners'
> association for such properties as condominiums covers this service.

**A**. **[Frequency]{.underline}**

> One initial grass cut is allowed during each grass-growing season
> followed by subsequent cuts periodically throughout the season. If a
> local variation requires that the grass be maintained year round, only
> one initial cut may be charged. If there is one grass-growing season
> in the geographical location of the property, one initial cut is
> allowed within a 12-month period. If there are multiple growing
> seasons, an initial grass cut is permitted at the beginning of each
> grass-growing season.
>
> If conveyance occurs during the growing season, unless otherwise
> indicated in local variations, a final grass cut should be completed
> within two weeks of conveyance.

Grass should typically be cut twice a month between April 1st and
October 31st, however, more frequent lawn cuts may be allowed in certain
areas as indicated in the variances at the end of this attachment. Grass
should not be cut between November 1st and March 31st unless prior
written approval is obtained from the M&M Contractor or otherwise
prescribed in the local variances. If the grass grows to six inches in
length during the off-season, the Mortgagee should request prior
approval to cut the grass.

B.  [Oversized Yards]{.underline}

> For yards greater than 15,000 square feet, Mortgagees should submit an
> over-allowable request. Requests to exceed cost limits for larger lots
> should be accompanied by lot dimensions and the calculated square
> footage of the lot as well as photo documentation. Mortgagees may
> request over-allowable approval for an entire growing season. For each
> over-allowable request, the Mortgagee should provide one bid for the
> cost of the initial cut, one bid for each subsequent cut (all of equal
> cost) and the total number of subsequent cuts required. Even if the
> Mortgagee is approved for an entire season, HUD will only reimburse
> grass-cutting expenses actually incurred.

C. [Specifications]{.underline}

Grass should be cut to a maximum of two inches in length. Grass and
weeds are to be cut to the edge of the property line and to a maximum of
two inches. Grass and weeds are to be trimmed around foundations,
bushes, trees, and planting beds. Grass and weeds should also be trimmed
flush with fences and other construction that would normally require
trimming.

> Shrubs are to be trimmed and cuttings removed once in a growing
> season, between April 1st and October 31st. An over-allowable should
> be submitted for any subsequent trimming of shrubs during the same
> growing season, with appropriate before and after photographs.

**II. [Snow Removal]{.underline}**

> The Mortgagee should maintain a safe and accessible property
> throughout the winter season. Snow should be removed from the entry,
> walkway, porch and driveway following a minimum three-inch
> accumulation. Mortgagees must comply with local codes and ordinances
> governing the removal of snow and ice. Before and after photographs
> are required for all snow and ice removal.

  --------------- ----------- ----------- ---------- ---------- ----------- ----------
  **Yard                                                                    
  Maintenance                                                               
  Cost Schedule**                                                           

  **State**       **Initial   **Initial   **Re-cut   **Re-cut   **Snow      **Trim
                  cut up to   cut 10,001  up to      10,001 sq  Removal**   Shrubs**
                  10,000 sq   sq ft to    10,000 sq  ft to                  
                  ft**        15,000 sq   ft**       15,000 sq              
                              ft**                   ft**                   

  Alabama         \$70        \$90        \$65       \$85       \$0         \$30

  Alaska          \$100       \$120       \$95       \$115      \$55        \$40

  Arizona         \$75        \$95        \$70       \$90       \$50        \$40

  Arkansas        \$70        \$90        \$65       \$85       \$45        \$40

  California      \$100       \$120       \$95       \$115      \$55        \$45

  Colorado        \$85        \$105       \$80       \$100      \$45        \$40

  Connecticut     \$100       \$120       \$95       \$115      \$55        \$45

  Delaware        \$95        \$125       \$90       \$120      \$45        \$35

  District of     \$95        \$115       \$90       \$110      \$55        \$45
  Columbia                                                                  

  Florida         \$85        \$105       \$80       \$100      \$0         \$30

  Georgia         \$85        \$105       \$80       \$100      \$0         \$30

  Guam            \$110       \$130       \$105      \$125      \$0         \$45

  Hawaii          \$110       \$130       \$105      \$125      \$0         \$45

  Idaho           \$100       \$120       \$95       \$115      \$55        \$45

  Illinois        \$85        \$105       \$80       \$100      \$45        \$30

  Indiana         \$85        \$105       \$80       \$100      \$45        \$30

  Iowa            \$85        \$105       \$80       \$100      \$45        \$40

  Kansas          \$85        \$105       \$80       \$100      \$45        \$40

  Kentucky        \$85        \$105       \$80       \$100      \$45        \$30

  Louisiana       \$85        \$105       \$80       \$100      \$45        \$40

  Maine           \$100       \$120       \$95       \$115      \$55        \$45

  Maryland        \$100       \$120       \$95       \$115      \$55        \$45

  Massachusetts   \$100       \$120       \$95       \$115      \$55        \$45

  Michigan        \$85        \$105       \$80       \$100      \$45        \$35

  Minnesota       \$85        \$105       \$80       \$100      \$45        \$40

  Mississippi     \$85        \$105       \$80       \$100      \$0         \$30

  Missouri        \$85        \$105       \$80       \$100      \$45        \$40

  Montana         \$85        \$105       \$80       \$100      \$45        \$40

  Nebraska        \$85        \$105       \$80       \$100      \$45        \$40

  Nevada          \$90        \$110       \$85       \$105      \$50        \$40

  New Hampshire   \$100       \$120       \$95       \$115      \$55        \$45

  New Jersey      \$100       \$120       \$95       \$115      \$55        \$45

  New Mexico      \$85        \$105       \$80       \$100      \$45        \$40

  New York        \$100       \$120       \$95       \$115      \$55        \$45

  North Carolina  \$85        \$105       \$80       \$100      \$45        \$30

  North Dakota    \$85        \$105       \$80       \$100      \$45        \$40

  Ohio            \$85        \$105       \$80       \$100      \$45        \$35

  Oklahoma        \$85        \$105       \$80       \$100      \$45        \$40

  Oregon          \$100       \$120       \$95       \$115      \$55        \$45

  Pennsylvania    \$95        \$115       \$90       \$110      \$45        \$35

  Puerto Rico     \$110       \$130       \$105      \$125      \$0         \$30

  Rhode Island    \$100       \$120       \$95       \$115      \$55        \$45

  South Carolina  \$85        \$105       \$80       \$100      \$0         \$30

  South Dakota    \$85        \$105       \$80       \$100      \$45        \$40

  Tennessee       \$85        \$105       \$80       \$100      \$45        \$30

  Texas           \$85        \$105       \$80       \$100      \$45        \$40

  Utah            \$85        \$105       \$80       \$100      \$45        \$40

  Vermont         \$100       \$120       \$95       \$115      \$55        \$45

  Virginia        \$95        \$115       \$90       \$110      \$55        \$45

  Virgin Islands  \$85        \$105       \$80       \$100      \$0         \$30

  Washington      \$100       \$120       \$95       \$115      \$55        \$45

  West Virginia   \$95        \$115       \$90       \$110      \$55        \$45

  Wisconsin       \$85        \$105       \$80       \$100      \$45        \$40

  Wyoming         \$85        \$105       \$80       \$100      \$45        \$40
  --------------- ----------- ----------- ---------- ---------- ----------- ----------

**If property yard is over 15,000 square feet, contact the M&M
contractor.**

**[Local Variations from General Requirements]{.underline}**

**[SANTA ANA Homeownership Center]{.underline}**

**[Arizona/ California/ Nevada]{.underline}**

Grass should be cut year-round. Properties with desert landscaping
require only once a month weed removal and are reimbursed as a re-cut.

**[Hawaii/Pacific Islands]{.underline}**

Grass should be cut year round.

**[ATLANTA Homeownership Center]{.underline}**

**[Florida]{.underline}**

Grass should be cut year round.

###### ATTACHMENT 7 Winterization Requirements and Cost Schedule  {#attachment-7-winterization-requirements-and-cost-schedule .unnumbered}

This section provides instruction for maintenance of utilities and
winterization of properties to protect against freeze damage. It also
addresses maintenance of wells and properties with sump pumps.

**I. [Utilities]{.underline}**

> Unless identified in the variations section of this attachment,
> utilities are to be turned off**.** In states where heat is to remain
> on, the temperature should be maintained at 55 degrees Fahrenheit
> unless otherwise noted in the local variations.
>
> **A**. **[Condominiums and Attached Dwellings]{.underline}**
>
> At condominiums and attached dwellings in Planned Unit Developments
> (PUDs), water services and utilities should remain on if the systems
> are shared with other units. M&M Contractors should be contacted for
> directions on maintaining water services at properties where a
> community water service is involved and for electrical services at
> condominiums or townhouses, duplexes, attached dwellings in PUDs,
> where such services should be left on due to homeowners' association
> or party wall requirements.
>
> **B.** **[Equipment Damage]{.underline}**
>
> When there is a jurisdictional requirement for heat to remain on and a
> repair or replacement is needed to make the heating system
> operational, the Mortgagee should contact the M&M Contractor for
> instructions when the repair or replacement exceeds \$250.00. The
> Mortgagee is responsible for damages to plumbing and heating systems
> caused by untimely and/or improper maintenance.

**C. [Sump Pumps]{.underline}**

> Where there is an existing sump pump used to keep basements or crawl
> space dry, the Mortgagee should leave the electricity on to assure the
> property is undamaged by flooding, regardless of whether the property
> is located in a state where utilities are required to be off. The
> Mortgagee should check to make sure the sump pump is operating.
> Mortgagees should request prior written approval from the M&M
> contractor if the cost of installing a sump pump exceeds \$250.
>
> **D. [Utility Accounts]{.underline}**
>
> Utility accounts including electricity, gas, home heating oil and
> water, should be in the Mortgagee\'s name until conveyance of the
> property to HUD. The Mortgagee should pay the bill and may claim
> reimbursement for utility costs covering the period from the date of
> vacancy until the end of the billing cycle that includes the date of
> conveyance. Payment of a utility bill that includes charges for a
> portion of a billing cycle that is post conveyance is the exception to
> HUD's policy on non-reimbursement of expenses after the conveyance
> date. It is the Mortgagee\'s responsibility to notify the utility
> company that ownership of the security property has been transferred
> to HUD (to the attention of the M&M contractor), upon conveyance. A
> copy of the notice should be maintained in the claim review file.
>
> In states where utilities should remain on, if there is any reason to
> believe that a Mortgagor may abandon a property, the Mortgagee should
> contact the utility company to request that the Mortgagee be notified
> of non-payment of utilities so that utilities can be transferred to
> the Mortgagee's name and the heat remain on if the Mortgagor vacates.
>
> **E.** **[Propane and Oil Systems]{.underline}**
>
> If the property has a propane or oil heating system, put a \"KEEP
> FULL\" contract on with a local supplier; in those jurisdictions,
> where the heat should remain "ON."

**II. [Water]{.underline}**

**A. [Domestic Water]{.underline}**

> If the water supply source is a public system, the utility should be
> contacted to turn off the water supply at the curb, unless otherwise
> indicated in the local variations. The Mortgagee should not cut water
> lines or remove water meters. (A non‑reimbursable charge may be
> imposed by the water utility for unauthorized water meter removal).
> The water department or provider should be notified when water is
> turned off so that a final meter reading can be done. The Mortgagee
> should ensure that this is completed. Where a water heater has to be
> installed, the Department will reimburse up to \$350 for an electric
> water heater or up to \$420 for a gas water heater, which includes the
> cost of installation.
>
> **B. [Wells ]{.underline}**
>
> If the water supply is a private well, the Mortgagee should turn off
> the well at the breaker panel and tape off the breaker, disconnect the
> water supply line between the property and pressure tank and install a
> hose bib on the pressure tank side of the breaker. The hose bib should
> then be tagged "For Water Testing\". All pressure tanks should be
> drained. If pump is surface mounted, drain pump housing, ‑ if
> submersible, then disconnect the check valve and drain all pump,
> suction, and discharge pipes. All fixtures should be winterized.
>
> **C. [Reduced Pressure Zone Device (RPZ or RPZD)]{.underline}**
>
> A reduced pressure zone device (RPZ) is a type of backflow prevention
> device used to protect domestic water supplies from contamination.
> Mortgagees should contact the local health departments and/or state
> and local agencies with regard to any jurisdictional requirements for
> the installation and/or use of the RPZ device on all wet heat systems.
> Mortgagees should obtain two independent competitive bids and request
> prior written approval from the M&M contractor if the cost of
> installation of an RPZ valve exceeds \$70.

[]{.mark}

**III. [Winterization]{.underline}**

> In jurisdictions where winterization is required, properties are to be
> winterized between October 1st and March 31st. For exceptions to these
> winterization time periods, see the *Local Variation from General
> Requirements* section on page 45. Properties should only be winterized
> once. However, a property should be re-winterized if the initial
> winterization is violated (no longer effective) and the Mortgagee
> obtains prior approval from the M&M Contractor.
>
> Unless otherwise specified by local variation, the winterization
> process must include cleaning toilets and draining of all plumbing and
> heating systems in a manner sufficient to prevent freeze and/or other
> damage. Use of air pressure to clear the system, or in some cases,
> adding antifreeze to the system is both acceptable, provided that the
> effect prevents freeze-ups. All winterization should be performed in
> accordance with state and local codes, ordinances and regulations.
> Before and after photographs are required along with any other
> supporting documentation to support a claim for re-imbursement.
>
> **A. [Dry Heat Systems]{.underline}**
>
> The hot water heater and all domestic water supply and distribution
> piping must be drained in a manner sufficient to prevent freeze and/or
> other damage. All faucets and valves should REMAIN OPEN during the
> process, and then closed after draining is completed. Adequate amounts
> of antifreeze are to be placed in all fixture traps, including toilet
> tanks and bowls.
>
> **B. [Wet Heat, Radiant, Hydronic or Hot Water Baseboard
> Systems]{.underline}**
>
> The winterization requirements outlined above apply. In addition, the
> house boiler system must be drained in a manner sufficient to prevent
> freeze and/or other damage. All radiator vents are to be opened in the
> process. Bleeder pins should not be removed from the radiators. Any
> radiant heat piping should be drained and blown dry with the use of an
> air compressor and an adequate amount of antifreeze is to be put in
> the radiant piping.
>
> **C. [Steam Heat Systems]{.underline}**
>
> The winterization requirements outlined above for Dry Heat Systems
> apply. Note: A steam heat system will have radiators with valves at
> the bottom of the radiator; a careful determination as to whether the
> system is hot water or steam is important to ensure proper action is
> taken. The Mortgagee should determine if the system is operable and if
> there are any leaks. If any problems with the steam heat system exist,
> this information should be reported to the M&M Contractor.
> Additionally, the Mortgagee must drain the property's boiler system in
> a manner sufficient to prevent freeze and/or other damage. All
> radiator vents are to be opened in the process and bleeder pins should
> not be removed from the radiators, before shutting down the heating
> system. Pressurize the system with an air compressor to 35 pounds and
> inspect for leakage. The expectation for a properly prepared system is
> that it will hold air pressure with no leakage for a minimum of
> one‑half hour.

**IV. [Repair Bids]{.underline}**

> The Mortgagee may spend up to \$250.00, for required repairs or
> installation of any new equipment required to maintain utilities or
> properly winterize a property including but not limited to, water
> wells, water meters, heating equipment, etc. Where such repairs will
> exceed \$250, the mortgagee shall obtain two independent competitive
> bids and submit the bids to the appropriate M&M contractor for
> approval. Please advise the M&M where the meter may only be removed by
> the utility company.

  ----------------- -------- ------------ --------- ------------ --------------- ---------------
  **Winterization                                                                
  Service Cost                                                                   
  Schedule**                                                                     

  **State**         **Dry    **Dry Heat   **Steam   **Steam Heat **Wet/Radiant   **Wet/Radiant
                    Heat 1   Additional   Heat 1    Additional   Heat 1 Unit**   Heat Additional
                    Unit**   Units**      Unit**    Units**                      Units**

  Alabama           \$90     \$50         \$140     \$90         \$460           \$230

  Alaska            \$130    \$50         \$190     \$90         \$475           \$465

  Arizona           \$80     \$50         \$120     \$90         \$460           \$230

  Arkansas          \$75     \$50         \$130     \$90         \$460           \$230

  California        \$75     \$50         \$130     \$90         \$460           \$230

  Colorado          \$120    \$50         \$160     \$90         \$460           \$230

  Connecticut       \$130    \$50         \$190     \$90         \$460           \$230

  Delaware          \$90     \$50         \$145     \$90         \$460           \$230

  District of       \$90     \$50         \$145     \$90         \$460           \$230
  Columbia                                                                       

  Florida           \$100    \$50         \$155     \$90         \$460           \$230
  (Jacksonville)                                                                 

  Georgia           \$100    \$50         \$150     \$90         \$460           \$230

  Hawaii            N/A      N/A          N/A       N/A          N/A             N/A

  Idaho             \$105    \$50         \$220     \$90         \$460           \$230

  Illinois          \$75     \$50         \$145     \$90         \$460           \$230

  Indiana           \$75     \$50         \$130     \$90         \$460           \$230

  Iowa              \$75     \$50         \$370     \$90         \$460           \$230

  Kansas            \$75     \$50         \$145     \$90         \$460           \$230

  Kentucky          \$85     \$50         \$155     \$90         \$460           \$230

  Louisiana         \$75     \$50         \$130     \$90         \$460           \$230

  Maine             \$130    \$50         \$190     \$90         \$460           \$230

  Maryland          \$90     \$50         \$145     \$90         \$460           \$230

  Massachusetts     \$130    \$50         \$190     \$90         \$460           \$230

  Michigan          \$75     \$50         \$155     \$90         \$460           \$230

  Minnesota         \$120    \$50         \$245     \$90         \$460           \$230

  Mississippi       \$75     \$50         \$130     \$90         \$460           \$230

  Missouri          \$75     \$50         \$145     \$90         \$460           \$230

  Montana           \$90     \$50         \$230     \$90         \$460           \$230

  Nebraska          \$75     \$50         \$130     \$90         \$460           \$230

  Nevada            \$105    \$50         \$145     \$90         \$460           \$230

  New Hampshire     \$130    \$50         \$190     \$90         \$460           \$230

  New Jersey        \$100    \$50         \$155     \$90         \$460           \$230

  New Mexico        \$120    \$50         \$160     \$90         \$460           \$230

  New York          \$100    \$50         \$130     \$90         \$460           \$230

  North Carolina    \$75     \$50         \$155     \$90         \$460           \$230

  North Dakota      \$120    \$50         \$245     \$90         \$460           \$230

  Ohio              \$75     \$50         \$115     \$90         \$460           \$230

  Oklahoma          \$75     \$50         \$130     \$90         \$460           \$230

  Oregon            \$75     \$50         \$130     \$90         \$460           \$230

  Pennsylvania      \$75     \$50         \$155     \$90         \$460           \$230

  Rhode Island      \$130    \$50         \$190     \$90         \$460           \$230

  South Carolina    \$75     \$50         \$155     \$90         \$460           \$230

  South Dakota      \$130    \$50         \$190     \$90         \$460           \$230

  Tennessee         \$90     \$50         \$150     \$90         \$460           \$230

  Texas             \$130    \$50         \$130     \$90         \$460           \$230

  Utah              \$135    \$50         \$140     \$90         \$460           \$230

  Vermont           \$135    \$50         \$130     \$90         \$460           \$230

  Virginia          \$75     \$50         \$145     \$90         \$460           \$230

  Washington        \$75     \$50         \$130     \$90         \$460           \$230

  West Virginia     \$75     \$50         \$130     \$90         \$460           \$230

  Wisconsin         \$75     \$50         \$130     \$90         \$460           \$230

  Wyoming           \$130    \$50         \$190     \$90         \$460           \$230
  ----------------- -------- ------------ --------- ------------ --------------- ---------------

####### Local Variations from General Requirements {#local-variations-from-general-requirements-2 .unnumbered}

**[ATLANTA Homeownership Center]{.underline}**

**[Illinois/Indiana]{.underline}**

Winterize year round, regardless of the month the property is secured.
However, heat will remain in shut down mode. Utilities are to remain off
unless required to operate a sump pump.

**[Caribbean]{.underline}**

Do not winterize.

**[Florida]{.underline}**

The water supply should be shut off at the curb. Notify utility
companies to cancel all services. Do not drain the water heater or water
lines. Do not winterize.

**[Jacksonville Florida ONLY]{.underline}**

Winterize from September 1 through April 30 from Jacksonville north to
the Georgia line. However, heat will remain in shut down mode. Utilities
are to remain off unless required to operate a sump pump.

**[DENVER Homeownership Center]{.underline}**

**[Colorado]{.underline}**

Winterization is required from September 1 through April 30. Heat is to
remain on in condominiums and town-homes.

**[Kansas, Missouri, Oklahoma]{.underline}**

Winterization is required from September 1 through April 30. However,
heat system will remain in shut down mode. Utilities are to remain off
unless required to operate a sump pump.

**[Minnesota, Montana, Iowa, North Dakota, Wyoming]{.underline}**

Winterization is required from September 1 through April 30. Utilities
and heat are to remain on.

**[Wisconsin]{.underline}**

Winterization is required from September 1 through April 30. Turn water
off at meter in house ONLY. Heating system will remain in shut down
mode. Utilities are to remain off unless required to operate a sump
pump.

**[SANTA ANA Homeownership Center]{.underline}**

Turn water off at the street after winterization in all Santa Ana M&M
contract areas, except Alaska.

###### Alaska  {#alaska .unnumbered}

All properties should be winterized year round. Heat should be left on
with the thermostat set at 55 degrees Fahrenheit. Properties should be
conveyed with water, gas, and utilities **ON.** Propane and fuel oil
delivery services should remain on automatic fill. Utilities should
remain in the servicing Mortgagee\'s name until conveyance. The
servicing Mortgagee is instructed and authorized to switch utilities
into HUD\'s name effective on the date of conveyance.

Water service may be turned off at the street (key box) only if the
property has a forced air or electric heating system and the domestic
water system has been properly winterized.

###### Arizona/California {#arizonacalifornia .unnumbered}

Winterize properties above 2,000 feet only. However, heat system will
remain in shut down mode. Utilities are to remain off unless required to
operate a sump pump.

**[Hawaii/Pacific Islands]{.underline}**

Do not winterize.

**[Nevada]{.underline}**

No winterization except for Pahrump zip code 89041 and Mt. Charleston
zip code 89124. All other winterization is completed on a case‑by‑case
basis. However, heat system will remain in shut down mode. Utilities are
to remain off unless required to operate a sump pump.

**[Reno, Nevada]{.underline}**

Winterize from September 15 through April 15. However, heat system will
remain in shut down mode. Utilities are to remain off unless required to
operate a sump pump.

**[Oregon]{.underline}**

Winterize from November 1 through March 31 only. However, heat system
will remain in shut down mode. Utilities are to remain off unless
required to operate a sump pump.

**[Washington]{.underline}**

Winterize from September 15 through April 15. However, heat system will
remain in shut down mode. Utilities are to remain off unless required to
operate a sump pump.

**[ATTACHMENT 8 Request to Exceed Cost Limits for Preservation and
Protection]{.underline}**

If the cost to perform required preservation and protection exceeds any
individual cost limits or the overall cap for preservation and
protection shown in this Mortgagee Letter, the Mortgagee should request
permission to exceed the maximum allowable expenses in writing using,
form HUD-50002, *Requests to Exceed Cost Limit for Preservation and
Protection (now PDF fill-able).* The Mortgagee must include
documentation to substantiate the over-allowable expense with the
request, including a line item bid for the individual work items to be
performed. All requests to exceed cost limits should include amounts
spent to-date on the property. The M&M can then determine if approval of
the request exceeds the overall cap for the property and if those
additional costs are feasible.

Mortgagees may mail, fax or e-mail their requests to the M&M
Contractor's office. Receipt of faxed request should be confirmed by
telephone. In the appropriate signature box(s) on the form, the
mortgagee and the M&M contractor shall put the name and contact phone
number of the individual authorized to act on behalf of the
organization. An approved or denied copy of the request and supporting
documentation must be maintained in the claim review file.

The M&M Contractor will review and approve or disapprove over-allowable
requests from Mortgagees within five business days of receipt. The M&M
Contractor will evaluate all requests to increase line items on a
case-by-case basis. With the exception of requests involving debris
removal where two independent bids are mandatory, Mortgagees will not be
asked to obtain a second bid for an over-allowable expense if the cost
of the item or service is \$250.00 or less. There is no requirement for
the Mortgagee to submit multiple bids for other expense types.

M&M contractors are familiar with usual and customary costs for most
expense types. However, if the type of work required, or the factors
impacting cost are unique, the Mortgagee is advised to take extra care
to document the request to fully substantiate the circumstances.

If the M&M Contractor believes the expense is not justified, or is
unable from the information provided to determine that the cost is
appropriate, the M&M Contractor will deny the over-allowable expense
request, in writing, providing a full explanation to the Mortgagee
including evidence of similar bids or past expenses for the same
services that support the denial. A denial is not approval to convey in
that condition; but rather, notice that additional information such as
independent bids may be needed to support the over-allowable. The M&M
Contractor may provide a listing of contractors who have performed
similar services at a reasonable price, but may not require use of any
particular contractor as a requirement for approval.

Upon receipt of two competitive and independent bids for the same scope
of work, M&M contractors may not deny bid approval or request a third
bid, solely on the basis that the first and second bids are too close in
price. Mortgagees should not submit bids that are far apart in price.
When bids are too far apart in price Mortgagees must reconcile them
prior to submission. If multiple bids are far apart in price the M&M may
request a revised bid, a third bid or provide a not-to-exceed amount
that would be acceptable for completion of the work. When a second bid
is required, filed service companies or contractors may not submit
second bids directly to the M&M contractor.

The M&M Contractor is required to respond to the Mortgagee's request, in
writing, within five business days from the date of receipt. Mortgagees
who have not received a response to an over-allowable expense request
within five business days should contact the appropriate GTR.

If the Mortgagee disagrees with the M&M Contractor's decision to deny
the request, the Mortgagee has 10 business days to submit an appeal to
the GTR. (See Attachment 10 for Appeal instructions) Appeals should be
mailed to the M&M Contractor. Upon receipt the M&M Contractor will date
stamp and deliver the package via fax or overnight mail to the GTR
within one business day. The GTR will respond to the Mortgagee's appeal
request within five business days of receipt from the M&M Contractor.
Mortgagees who have not received a response to their appeal within five
business days should contact the REO Director. There is no appeal of
over-allowable expense requests beyond the REO Director.

A Mortgagee may elect, as a matter of convenience, to obtain services at
a cost higher than the allowable limits, but it may not claim amounts in
excess of the limits for reimbursement.

**[ATTACHMENT 9 Request to Exceed Timeframes]{.underline}**

Requests to exceed cost limits are not the same as requests to exceed
timeframes. Neither, approval to exceed allowable cost limits or failure
to receive a timely response from an M&M Contractor to exceed cost
limits constitutes an extension of time to convey title and submit form
HUD-27011, Part A, or an extension of time to provide title evidence and
submit form HUD-27011, Part B. The Mortgagee should submit a separate
request for each request for an extension of time. All requests for
extensions should be submitted on form HUD 50012, *Mortgagee's Request
for an Extension of Time (nowPDF fill-able).* Verbal requests for
extensions will not be accepted.

Mortgagees should submit written extension requests to the M&M
Contractor responsible for disposition of the property. Upon receipt,
the M&M contractor will have five business days to approve the request,
reject the request as lacking adequate documentation or deny the
request. If the M&M Contractor rejects or denies the request for an
extension of time, the Contractor will specify in writing the reason for
the rejection or denial on form HUD-50012.

If the Mortgagee has not received a response within five business days
of receipt by the M&M Contractor, the Mortgagee may resubmit a copy of
the request directly to the GTR. The GTR will have five business days
from receipt, either to approve the request, reject the request as
lacking adequate documentation or deny the request. If the GTR rejects
or denies the request for an extension of time, the GTR will specify in
writing the reason for the rejection or denial on form HUD-50012.

If the GTR fails to respond to the request for an extension of time
within five business days, the Mortgagee may contact the REO Director at
the HOC with jurisdiction over the property and request an extension of
time. The REO Director will make a determination to approve or deny. In
instances where HUD's failure to respond caused the Mortgagee to exceed
time limits, the REO Director will authorize a 30 day extension of time
to allow for resolution of that issue. There is no appeal of extension
requests beyond the REO Director.

In emergency situations, Mortgagees may fax their requests to the M&M
Contractor's office, and confirm receipt of these requests by telephone.
The local M&M Contractors office will respond to these emergency
requests via fax if the Mortgagee so requests. Mortgagees are
responsible for confirming receipt and legibility of all requests sent
via fax.

**[ATTACHMENT 10 Mortgagee Appeal Process]{.underline}**

If a Mortgagee has improperly conveyed a property or billed HUD for
preservation and protection services that were either not performed or
were not properly performed, the HUD GTR may authorize the M&M
contractor to issue a Notice of Intent to Re-convey or a Demand Letter.
HUD has established a two-stage appeal process for Mortgagee disputes
arising from re-conveyance requests and demand letters. This process is
designed to expedite resolution of disputes while providing enhanced
Mortgagee protections.

I.  **[STAGE 1 -- Homeownership Center (HOC)]{.underline}**

> If a Mortgagee believes that the re-conveyance or demand decision
> issued by the GTR is not supported by regulation or circumstance, the
> lender may appeal to the REO Director at the HOC with appropriate
> jurisdiction.
>
> The REO Director must receive a written appeal, within 15 business
> days from the date of the Notice of Intent to Re-convey or the Demand
> Letter. Appeals received after this date will not be accepted.
>
> The REO Director will review and respond to the appeal within 15
> business days from receipt. Communication will be via e-mail or U.S.
> mail. If the appeal involves a cost to the Mortgagee of \$2,500 or
> less, the decision of the REO Director is final and further appeals
> will not be accepted. An M&M Contract Area map indicating the
> appropriate Homeownership Center is available on the HUD website
> (<http://www.hud.gov/offices/hsg/sfh/reo/mm/mminfo.cfm>).

**II. [STAGE 2 -- Office of Single Family Asset
Management]{.underline}**

> If a Mortgagee does not receive a response to their appeal within the
> timeframe noted, or if a Mortgagee believes that the decision of the
> REO Director is not supported by regulation or circumstance, and the
> appeal involves a cost to the Mortgagee in excess of \$2,500, the
> lender may appeal to the Director of the Office of Single Family Asset
> Management (SFAM) at the following address:
>
> Department of Housing and Urban Development
>
> National Servicing Center
>
> Attn: CRC, Re-conveyance Appeals
>
> 301 Northwest Sixth Street, Suite 200
>
> Oklahoma City, OK 73102
>
> The appeal should be received in writing by SFAM within 15 business
> days of the REO Director's decision or 15 business days from the date
> the REO Director's response was due. Appeals received after this date
> will not be accepted. The SFAM Director or designee will review and
> respond to the appeal within 30 business days from receipt.
> Communication will be via e-mail with concurrent written confirmation
> by U.S. mail. The decision of the SFAM Director is final and further
> appeals will not be accepted.