1. Dealing with Disasters & FLEX Mods

2. Two Sides of Disaster
Are you prepared to work through the crises?
How are you going to help your borrowers?

3. Business Continuity
What controls do you have in place if your building is inaccessible?
What if your building is destroyed – how quickly can you be back in business?
How is data protected?
Does your staff know how to communicate to you under each scenario?
How do you care for your staff that might be effected by the disaster?
Have you identified critical functions and staff?

4. Communication is Critical
Call in voic messaging
Instructions on website -
a) Who is given responsibility to assess the situation?
b) Who is has authority to decide on course of action?
c) Is there a timeframe before someone else takes responsibility?
d) Which individuals are responsible for updating the website?
Wallet cards with staff instructions –
a) Explains where to go to find out status and instructions
b) Who to report their status (able to work or not?)
c) Multi scenarios

5. Helping Homeowners
How do they reach you if the building has been compromised? How would calls be forwarded and distributed?
Updating the website with instructions
Generic message on main Customer Service line
Explaining both insurance and default assistance

6. Handling Scale
Have templates set up to do mass Disaster Forbearance Plans – with an export from the servicing system – identifying by zip code
For conventional, non-insured loans have plans in place on cap and extend mods for those borrowers who had no adverse long term impact on income, but who may have experienced a temporary loss of income or home repairs that were resolved
Begin training alternate staff or contract with vendor to assist with insured loans for proper loss mitigation compliance.

7. The Next Disaster?

8. FLEX Modification Extend the term 480 months
If MTMLTV is under 80% - leave note interest rate.
If MTMLTV is over 80% - change to lesser of FNMA mod rate or note interest rate.
If MTMLTV is over 100% - forbear principal to the lesser of post mod MTMLTV reaches 100% OR 30% of the gross post-mod UPB
If P&I has not been reduced by 20% - forbear an additional amount until the lesser of an amount that would create a post-mod MTMLTV of 80% OR 30% of gross post mod UPB.
If loan is at least 90 days delinquent, continue to forbear until a 40% HTI is achieved but not more than 30% of the post mod UPB OR an amount that would create a post-mod MTMLTV of 80%

9. Here we go AGAIN!
It is not about the borrower’s ability to repay, its about the property value.
As the Reason for Default shifts back to Excessive Obligations from Unemployment and Loss of Income the FLEX Mod will only provide temporary relief – if we fail to counsel borrowers on their spending habits we will witness higher default rates
As HFAs – your clientele is in desperate need of counseling and additional assistance.

10. Donna Schmidt, Managing Director
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Donna Schmidt, Managing Director
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