Source: https://www.federalregister.gov/documents/2005/01/21/05-1046/change-in-default-reporting-period
Timestamp: 2017-08-19 19:23:48
Document Index: 469898790

Matched Legal Cases: ['§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', '§\u2009203', 'art 1320', 'art 203', '§\u2009203']

A Proposed Rule by the Housing and Urban Development Department on 01/21/2005
Hud-2004-0022
3265-3268 (4 pages)
Docket No. FR-4916-P-01
https://www.federalregister.gov/d/05-1046 https://www.federalregister.gov/d/05-1046
Start Preamble Start Printed Page 3266
This proposed rule would revise the regulations under the single-family mortgage insurance program that require mortgagees to report the status of all single-family mortgages insured by HUD that are in default after 60 days or that are 90 or more days delinquent, as applicable. The rule would require mortgagees to report to HUD mortgages that are 30 or more days delinquent on the last day of the month. The Department believes that the rule would, among other things, provide HUD with more recent delinquency information. The receipt of more up-to-date information will enable HUD to better monitor its loss mitigation program and strengthen the soundness of the Federal Housing Administration (FHA) Mortgage Insurance Funds.
Joseph McCloskey, Director, Office of the Deputy Assistant Secretary for Single Family Housing, Office of Housing, Department of Housing and Urban Development, Room 9172, 451 Seventh Street, SW., Washington, DC 20410-8000; telephone 202-708-1672 (this is not a toll-free number). Persons with hearing or speech impairments may access this number through TTY by calling the toll-free Federal Information Relay Service at 800-877-8339.
Under HUD's existing regulations at 24 CFR 203.332, 203.439(c), and 203.468, mortgagees are required to report to HUD the status of all FHA single-family mortgages that are delinquent. Section 203.332 provides that a monthly report is to be made to the FHA Commissioner (Commissioner) by the mortgagee with respect to “mortgages insured under this part that are 90 or more days delinquent.” The report also must list the “status of all mortgages which were reported as 90 or more days delinquent the previous month.”
Under section 203.439(c), mortgagees are required to notify the Department of Hawaiian Home Lands each month of those mortgages insured under section 247 of the National Housing Act (12 U.S.C. 1715z-12) on leaseholds of Hawaiian home lands that are 90 or more days delinquent, including mortgages reported the previous month as 90 or more days delinquent. The regulation provides that the notice is in addition to the report required under § 203.332.
With regard to default, § 203.468 requires that the lender notify the Commissioner of a default within 60 days after its occurrence, unless the default has been cured or unless the Commissioner has been notified of a previous default that remains uncured.
The delinquency and default information is used to identify status and trends of FHA insured mortgages. Default reporting is also an effective indicator of FHA lenders' origination and servicing activities along with potential risks to the FHA Mutual Mortgage Insurance Fund. HUD's Single Family Default Monitoring System, through the submission of data by the mortgagees, captures loan level default data and feeds this information to other HUD portfolio management and lender monitoring systems, including Credit Watch and Neighborhood Watch. Accurate default reporting is essential to HUD's portfolio and lender monitoring activities.
This rule would revise 24 CFR 203.330 and 203.331 by changing the data reporting period for delinquent mortgages and defaulted mortgages to once each month on a day prescribed by HUD. The report shall be made in a manner prescribed by HUD. In light of the proposed revisions to §§ 203.330 and 203.331, this rule would remove § 203.332 to avoid unnecessarily duplicative sections.
This rule would also revise paragraph (c) of 203.439 to state that the mortgagee shall notify the Department of Hawaiian Home Lands once a month on a day prescribed by HUD of all mortgages insured under section 247 of the National Housing Act on leaseholds of Hawaiian home lands that are delinquent on the last day of the month. The notice would be in addition to the requirements in §§ 203.330 and 203.331.
Finally, §§ 203.466 and 203.467 also would be revised to conform them to the proposed revisions of §§ 203.330 and 203.331, with respect to the definitions and notice requirements, respectively, of the former sections. In light of the proposed revisions to §§ 203.466 and 203.467, this rule would remove § 203.468 to avoid unnecessarily duplicative sections.
The revisions proposed by this rule would require mortgagees to begin their delinquency reporting of all loans in which the monthly payment is due but not paid by the last day of the month. HUD believes that the proposed regulatory changes should be welcomed by mortgagees. These changes would bring FHA's requirements closer to Fannie Mae, Freddie Mac, the Mortgage Bankers Association, and industry standards for delinquency reporting requirements. As such, FHA would be in a better position to integrate itself, should it choose to do so, into a single platform for industry-wide default data reporting. Additionally, mortgagees should better understand references to payments due and unpaid rather than being required to count days from the due date.
HUD also believes that the proposed revisions would also contribute to FHA's efforts in protecting the financial integrity of the FHA Mutual Mortgage Insurance Fund. The revisions proposed in this rule would result in the Department's receiving more recent and timely delinquency and default information thereby increasing FHA's ability to forecast default volume, future defaults, and potential insurance losses. More timely information will also enable FHA to better monitor its loss mitigation program. This is important Start Printed Page 3267since FHA insures 100 percent of a mortgage loan as compared to private mortgage insurers that insure only 10 to 20 percent of a loan.
All activity under this rule 600 7200 1 7200
Interested persons are invited to submit comments regarding the information collection requirements in this rule. Under the provisions of 5 CFR part 1320, OMB is required to make a decision concerning this collection of information between 30 and 60 days after today's publication date. Therefore, a comment on the information collection requirements is best assured of having its full effect if OMB receives the comment within 30 days of today's publication. This time frame does not affect the deadline for comments to the agency on the interim rule, however. Comments must refer to the proposal by name and docket number (FR-4712) and must be sent to:
Mark Menchik, HUD Desk Officer, Office of Management and Budget, New Executive Office Building, Washington, DC 20503-0001, Fax number: (202) 395-6947, E-mail: Mark_D._Menchik@omb.eop.gov
This rule is categorically excluded from environmental review under the National Environmental Policy Act (42 U.S.C. 4321). In keeping with the exclusion provided for in 24 CFR 50.19(c)(1), this rule does not direct, provide for assistance or loan and mortgage insurance for, or otherwise govern or regulate, real property acquisition, disposition, leasing, rehabilitation, alteration, demolition, or new construction, or establish, revise or provide for standards for construction or construction materials, manufactured housing, or occupancy. Accordingly, under 24 CFR 50.19(c)(2), this rule is categorically excluded because it amends an existing document where the existing document as a whole would not fall within the exclusion in 24 CFR 50.19(c)(1) but the amendment by itself would do so.
The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) establishes requirements for federal agencies to assess the effects of their regulatory actions on state, local, and tribal governments and on the private sector. This rule does not impose a federal mandate on any state, local, or tribal government, nor on the private sector, within the meaning of the Unfunded Mandates Reform Act of 1995.
The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) generally requires an agency to conduct a regulatory flexibility analysis of any rule subject to notice and comment rulemaking requirements unless the agency certifies that the rule will not have a significant economic impact on a substantial number of small entities. This proposed rule would not impose any new obligation small entities participating in the FHA single-family mortgage insurance programs. Although the rule would require timelier reporting by servicers of delinquent mortgages, the information that the servicers will report is already in their possession. As a result, any new expense to small entities caused by this rule would be negligible. Further, there are no anti-competitive discriminatory aspects of the rule with regard to small entities. Accordingly, the undersigned certifies that this rule will not have a significant economic impact on a substantial number of small entities.
Start List of Subjects Start Printed Page 3268
Accordingly, for the reasons described in the preamble, HUD proposes to amend 24 CFR part 203 to as follows:
(b) Once each month on a day prescribed by HUD, the mortgagee shall report to HUD all mortgages insured under this part that were delinquent on the last day of the month. The report shall be made in a manner prescribed by HUD.
3. Revise 203.331 to read as follows:
(b) Date of default. For the purposes of this subpart, the date of default shall be considered as 30 days after-
(c) Notice of default. Once each month, on a day prescribed by HUD, the mortgagee shall report to HUD all mortgages that were in default on the last day of the month. The report shall be made in a manner prescribed by HUD.
(c) Notice of delinquency. Once each month on a day prescribed by HUD, the mortgagee shall notify the Department of Hawaiian Home Lands of all mortgages insured pursuant to section 247 of the National Housing Act on leaseholds of Hawaiian home lands that are delinquent on the last day of the month. The notice is in addition to the requirement in §§ 203.330 and 203.331.
6. Revise 203.466 to read as follows:
7. Revise 203.467 to read as follows:
(a) Default. If the borrower fails to make any payment or to perform any other obligation under the mortgage, and such failure continues for a period of 30 days, the mortgage shall be considered in default for the purposes of this subpart.
(c) Notice of default. Once each month, on a day prescribed by HUD, the mortgagee shall report to the Secretary all mortgages that were in default on the last day of the month. The report shall be made on a form prescribed by HUD.
[FR Doc. 05-1046 Filed 1-19-05; 8:45 am]
BILLING CODE 4916-01-P