New Dodd-Frank Requirement Issued for Making Home Affordable

New Dodd-Frank Requirement Issued for Making Home Affordable

The U.S. Treasury Department issued a new Supplemental Directive 10-11 of the Making Home Affordable (MHA) program this week.

Also known as the Dodd-Frank Certification Requirement, it provides guidance on the new borrower certification for non-GSE loans participating in the MHA program, as required under Section 1481(d) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

The new requirement states that borrowers are not eligible to receive assistance under the MHA program if they have been convicted of felony larceny, theft, fraud, or forgery; money laundering; or tax evasion in connection with a mortgage or real estate transaction within the last 10 years.
A servicer must obtain a Dodd-Frank Certification from borrowers as outlined in the new Supplemental Directive. Servicers should also note that there is an interim period requirement effective September 22 to December 31, and a final period requirement effective beginning January 1.

Home Affordable Modification Program (HAMP) and Second Lien Modification Program (2MP) trial period plans and trial period plan offers are not impacted by the Dodd-Frank Certification requirement if they are outstanding as of September 21.

The same applies to permanent HAMP, 2MP, Treasury FHA-HAMP, and RD-HAMP (Rural Housing Service) modifications and permanent modification offers, as well as short sale and deed-in-lieu of foreclosure (DIL) offers under the Home Affordable Foreclosure Alternatives (HAFA) program.

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