APPENDIX C
INSTRUCTIONS FOR CONSOLIDATED STATE REPORT

 Instructions for Consolidated State Report for Mortgage Servicers

Intent

The Consolidated State Report (CSR) is intended to collect data on the status of residential mortgage portfolios, loss mitigation efforts, and foreclosures. The reports will provide important data on the status of the market. This report should also reduce the regulatory burden on the industry by providing a common reporting format which will be submitted to a single source and distributed to the pertinent state authorities.

The CSR should be completed on a consolidated basis, including all offices and subsidiaries.

Schedule I

Report all balances as point in time as of the report date.

Item No.      Caption & Instructions
Part A

1          Total loans serviced

Report the total number and unpaid principle balance (UPB) for all first and second mortgage loans serviced by your company.

·        Items 1a & 1b should total to this item.

·        Items 2a & 2b should total to this item

·        Items 3a, 3b, & 3c should total to this item.

1a           Serviced loans originated and funded by an unaffiliated party
Report the total number and UPB for loans you service which were originated and funded by an entity not related to your company through common majority ownership, management or board of directors.

1b           Serviced loans where originator or funder is affiliated with the servicer
Report the total number and UPB for loans you service which were originated or funded by an entity related to your company through common majority ownership, management or board of directors.

2a             Serviced loans secured by owner-occupied residence

2b             Serviced loans for investment or second residence property

3a            Loans which are secured by a first mortgage only

Report the total number and UPB for loans which you only service a first mortgage.

 3bLoans which are secured by a second mortgage only

Report the total number and UPB for loans which you only service a second mortgage.

3cLoans which you service both the first and second mortgage

Report the total number and UPB for loans which you service both the first and second mortgage. For the number of loans, count both loans.

4           Prime Loans

Report the total number and UPB for prime loans.

• Items 4a, 4b, 4c, 4d, 4e, 4f should total to this item.

4a        Fixed rate, fully amortizing

Report the total number and UPB for prime loans which have a fixed rate of interest and are fully amortizing.

4b         Hybrid ARMs (2/28, 3/27 or similar)

Report the total number and UPB for prime loans which provide low initial payments based on a fixed rate that expires after a short introductory period (two or three years), and then adjusts on a regular basis (e.g. every six months) to a variable rate plus a margin for the remaining term of the loan.

4c        Adjustable rate, fully amortizing

Report the total number and UPB for adjustable rate, fully amortizing prime loans not meeting the definition in 4b.

4d      Loans with interest only feature

Report the total number and UPB for prime loans which permit the payment of interest only at any point during the term.

4e          Payment Option ARMs and other loans with negative amortization feature
Report the total number and UPB for prime loans with payment characteristics which may lead to negative amortization. Include any other loan with a negative amortization feature.

4f            Other

Report the total number and UPB for prime loans which do not fit any of the above definitions, such as a loan with an extended amortization (e.g. a “40/30” loan with a 40 year amortization on a 30 year term (with a balloon payment at the end of the 30^th year)

 5           Subprime & Alt-A loans

Subprime refers to loans to borrowers who typically have weakened credit histories that include payment delinquencies and possibly more severe problems such as charge-offs, judgments, and bankruptcies. They may also display reduced repayment capacity as measured by credit scores, debt-to income (DTI) ratios, or other criteria that may encompass borrowers with incomplete credit histories. Subprime may also refer to loans with higher rates than prime loans, typically marketed to borrowers with subprime credit. Reporter should categorize loans based on commonly-accepted industry definitions.

Alt-A refers to loans to borrowers who do not qualify for prime credit or lack the required documentation to be a prime borrower or may have some of the characteristics of a sub-prime borrower.

• Items 5a, 5b, 5c, 5d, 5e, & 5f should total to this item.

5a-f          See respective descriptions for 4a-f.
Part B

6 What is the total anticipated number and amount of prime loans where the interest rate will have its initial reset? What number and volume of these loans are currently over 30 days past due?

Report the total number and UPB of loans scheduled for an initial reset for each of the next 8 quarters. Also indicate the loans from the first two columns which are over 30 days past due.

7            What is the total anticipated number and amount of subprime and Alt‑
A loans where the interest rate will have its initial reset? What number and volume of these loans are currently over 30 days past due? Report the total number and UPB of loans scheduled for an initial reset for each of the next 8 quarters. Also indicate the loans from the first two columns which are over 30 days past due.

 Item No. Caption & Instructions Part A – Prime Loans

1           Loans presently past due
H eading, not a reporting field.

1a           30 to 59 days past due

Report number of loans and UPB for all prime loans where the minimum required payment has not been made for 30 to 59 days. For monthly pay loans, the borrower would be due for one payment and past due for one payment.

1b           60 to 89 days past due

Report number of loans and UPB for all prime loans where the minimum required payment has not been made for 60 to 89 days. For monthly pay loans, the borrower would be due for one payment and past due for two payments.

1c           90 days past due or over

Report number of loans and UPB for all prime loans where the minimum required payment has not been made for at least 90 days. For monthly pay loans, the borrower would be due for one payment and past due for three payments.

2       Loans from above which were modified in the last 12 months

Report number of loans and UPB for loans reported in 1a, 1b, or 1c, which have had any type of debt modification to mitigate potential loss and/or accommodate the needs of the borrower.

3           Loans in process of foreclosure

Report number of loans and UPB for loans reported in 1a, 1b, or 1c, which are considered to be in process of foreclosure.

• Items 3a & 3b should total to this item.

3a         Loans where notice of default sent

Report number of loans and UPB for loans where during the reporting period, the borrower has been notified of default. No other action towards foreclosure has been taken.

3b     Loans where formal foreclosure proceedings started

Report number of loans and UPB for loans where the foreclosure process has begun. (Example: Judicial filing or public notice).

 4       Loans where foreclosure preceding completed (ORE)

Report number of loans and UPB at the time of foreclosure for mortgages which have completed foreclosure resulting in the transfer of ownership of the residence or the effective control over the property.

5           Loans which entered delinquency within 3 payments of initial rate reset
Report number of loans and UPB for loans reported in 1a, 1b, or 1c, which became delinquent within 3 payments of the interest rate on the loan resetting.

Part B – Subprime & Alt-A Loans

6 – 10See respective descriptions for 1 – 5 above.

 Item No. Caption & Instructions Part A

1            Loss mitigation efforts in process

Heading, not a reporting field.

In this part, report loss mitigation efforts which are in process, but not yet complete. Report the number of loans and UPB in the category agreed to but not finalized or in the category most likely to occur.

1a              Deed in lieu

Borrower deeds the property to the servicer to avoid foreclosure.

1b              Short sale

Borrower sells property to a third party prior to foreclosure sale and the servicer forgives any shortage on UPB.

1c              Forbearance

A postponement of payment on the loan.

1d             Repayment plan

Increased payments for a specific period of time to allow the borrower to bring the loan current.

1e             Refinance or paid in full

Borrower will secure a new loan to pay-off the existing debt or pay off in full by some other means.

1f          Reinstatement/Account made current
Borrower will pay all past due amounts.

1g Modification (principal reduction, interest rate &/or term of debt) Some or all the terms of the debt are changed to enable the borrower to service the obligation.

Part B

2            Loss mitigation efforts closed

Heading, not a reporting field.

In this part, report loss mitigation efforts which have been closed during the reporting period. Report the number of loans and UPB in the appropriate category following the definitions from above.

 3         Prepayment penalty waived (from any of the above)

Report the number and amount of any prepayment penalties waived as part of any of the above actions.

Part C

4           Time horizon for closed loan modifications

Heading, not a reporting field.

·                    The sum of 4a & 4b should equal 1g in Part B.

4a        Modification effective for less than life of loan (e.g. 2 years)

Report number of loans and UPB for modifications which do not cover the full term of the loan.

4b            Modification effective for life of loan

Report number of loans and UPB for modification which are effective for the full term of the loan.

5             Types of modifications closed

Heading, not a reporting field.

Report the number of loans and UPB for each type of modification listed below. Note that item 5f is the reporting field for modifications with multiple characteristics.

·                    The sum of 5a through 5g should equal 1g in Part B.

5a                 Modification by freezing interest rate at the initial/start rate

5b                 Modification by reducing the interest rate below the initial/start rate

5c         Modification by reducing the interest rate below scheduled reset rate,
but above start rate.

5d                 Modification with extension of term

5e                 Modification with reduction in principal balance

5f          Modification using two or more of above modifications (e.g. rate
reduction and term change)

5g               Other modification

Schedule IV

Report the number of loans serviced and the UPB by state.