[Federal Register Volume 66, Number 115 (Thursday, June 14, 2001)]
[Rules and Regulations]
[Pages 32230-32231]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-15069]


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

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 36

RIN 2900-AK72


Delegation of Authority--Portfolio Loan Servicing Contractor

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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

SUMMARY: This document delegates to certain officers of the entity 
performing loan servicing functions under a contract with the Secretary 
authority to execute all documents necessary for the servicing and 
termination of a loan made or acquired by the Secretary.

DATES: Effective Date: June 14, 2001.

FOR FURTHER INFORMATION CONTACT: Richard Fyne, Assistant Director for 
Loan Management (261), Veterans Benefits Administration, 810 Vermont 
Ave., Washington, DC 20420, telephone 202-273-7380.

SUPPLEMENTARY INFORMATION: The provisions of 38 U.S.C. chapter 37 
authorize the Secretary of Veterans Affairs (VA) to guarantee or make 
loans to veterans. Under a number of circumstances VA becomes the 
holder of a housing loan. The most common reasons are: VA acquired the 
property securing a guaranteed loan following foreclosure and sold the 
security on terms (sometimes called a ``vendee loan.''), VA took an 
assignment of (or ``refund'') a guaranteed loan pursuant to 38 U.S.C. 
3732(a)(2), or VA made a direct loan to a veteran pursuant to 38 U.S.C. 
3711 or 3761.
    VA has contracted with a private entity for the servicing of its 
housing loan portfolio. In order to increase the efficiency of this 
contract, certain officers of the contractor are being delegated 
authority to execute, on behalf of VA, routine documents necessary for 
the servicing and foreclosing of the loans being serviced.
    Currently, 38 CFR 36.4342 authorizes certain VA officials, such as 
field station Directors, Loan Guaranty Officers, and Assistant Loan 
Guaranty Officers, to execute these documents. Regional Offices are 
required to maintain a cumulative list of all employees of that office 
who have held the designated positions since May 1, 1980.
    This rule adds a new paragraph (e) to 38 CFR 36.4342 which 
delegates to persons holding the office of Vice President, Assistant 
Vice President, and Assistant Secretary of the entity performing loan 
servicing functions under a contract with VA the authority to execute 
all documents necessary for the servicing and termination of a housing 
loan made or acquired by VA. Documents authorized to be executed will 
include loan modification agreements, notices of default, notices of 
appointment or substitution of trustees, releases or satisfactions of 
mortgages,

[[Page 32231]]

loan assumption agreements, deeds tendered upon satisfaction or 
conversion of an installment land sales contract, and documents related 
to filing, pursuing and settling claims with hazard insurance 
companies.
    The Director of the VA Loan Guaranty Service, Washington, DC, will 
maintain a log listing all corporate officers of the contractor who 
have been authorized to execute documents and the dates during which 
these persons were authorized to act. VA will also maintain copies of 
resolutions of the contractor's board of directors authorizing these 
persons to execute these documents. Those files will be available for 
public inspection and copying during normal business hours at the 
Office of the Director of VA Loan Guaranty Service, Washington, DC 
20420.
    This authority does not apply, however, with respect to loans under 
the pilot program for multifamily transitional housing projects for 
homeless veterans under 38 U.S.C. chapter 37, subchapter vi. Such loans 
will not be serviced by the contractor servicing the VA loan portfolio.
    The provisions of 38 CFR 36.4342(e) are published without regard to 
the notice and comment and delayed effective date provisions of 5 
U.S.C. 553 since they relate to agency management and personnel and are 
not substantive rules.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3520).

Executive Order 12866

    This document has been reviewed by the Office of Management and 
Budget under Executive Order 12866.

Regulatory Flexibility Act

    The Secretary of Veterans Affairs hereby certifies that this final 
rule will not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act, 5 U.S.C. 601-612. The final rule relates to agency 
management and personnel and does not contain substantive provisions. 
Accordingly, pursuant to 5 U.S.C. 605(b), this final rule is exempt 
from the initial and final regulatory flexibility analysis requirements 
of Secs. 603 and 604.
    There is no Catalog of Federal Domestic Assistance number for this 
program.

List of Subjects in 38 CFR Part 36

    Condominiums, Housing, Indians, Individuals with disabilities, Loan 
programs-housing and community development, Loan programs, Indians, 
Loan programs-veterans, Manufactured homes, Mortgage insurance, 
Reporting and recordkeeping requirements, Veterans.

    Approved: March 14, 2001.
Anthony J. Principi,
Secretary of Veterans Affairs.
    For the reasons set out in the preamble, 38 CFR is amended as set 
forth below.

PART 36--LOAN GUARANTY

    1. The authority citation of part 36 continues to read as follows:

    Authority: 38 U.S.C. 501, 3701-3704, 3707, 3710-3714, 3719, 
3720, 3729, 3762, unless otherwise noted.

    2. In Sec. 36.4342, paragraph (e) is added immediately following 
paragraph (d); and the authority citation at the end of the section is 
revised to read as follows:


Sec. 36.4342  Delegation of authority.

* * * * *
    (e)(1) Authority is hereby delegated to the officers, designated in 
paragraph (e)(2) of this section, of the entity performing loan 
servicing functions under a contract with the Secretary to execute on 
behalf of the Secretary all documents necessary for the servicing and 
termination of a loan made or acquired by the Secretary pursuant to 38 
U.S.C. chapter 37 (other than under subchapter vi of that chapter). 
Documents executed under this paragraph include but are not limited to: 
loan modification agreements, notices of default and other documents 
necessary for loan foreclosure or termination, notices of appointment 
or substitution of trustees under mortgages or deeds of trust, releases 
or satisfactions of mortgages or deeds of trust, acceptance of deeds-
in-lieu of foreclosure, loan assumption agreements, loan assignments, 
deeds tendered upon satisfaction or conversion of an installment land 
sales contract, and documents related to filing, pursuing and settling 
claims with insurance companies relating to hazard coverage on 
properties securing loans being serviced.
    (2) The designated officers are: Vice President, Assistant Vice 
President, and Assistant Secretary.
    (3) The Director, Loan Guaranty Service, Washington, DC, shall 
maintain a log listing all persons authorized to execute documents 
pursuant to paragraph (e) of this section and the dates such persons 
held such authority, together with certified copies of resolutions of 
the board of directors of the entity authorizing such individuals to 
perform the functions specified in paragraph (e)(1) of this section. 
These records shall be available for public inspection and copying at 
the Office of the Director of VA Loan Guaranty Service, Washington, DC 
20420.

(Authority: 38 U.S.C. 501, 3720(a)(5))
[FR Doc. 01-15069 Filed 6-13-01; 8:45 am]
BILLING CODE 8320-01-P