Servicemember notice - correct language.

Servicemembers notice. i see links to HUD http://www.hud.gov/offices/adm/hudclips/forms/files/92070.pdf
for a sample notice.
But do i understand correctly that the sample notice is incorrect and should be changed - the 90 days becomes 9 months and the 6% rate language should add "effective for a year after leaving the service"??
Is there some sample of this that we can use?

We made those changes last year when the provisions were passed. We have been examined and they looked for those changes to make sure we were compliant with them. I have not seen anything from HUD.

Don't these changes sunset after 12-31-10?

No. The president signed on 12/29 the "Helping Heroes Keep Their Homes Act" which extended the 90 days ==> 9 months changes through 12/31/12.

The provision that extended the 6% cap on mortgage and deed of trust loans to the term of service plus one year following service is permanent. It only applies to mortgage and deed of trust loans.

So (why is this so difficult for me to get through my head) the sample notice on the HUD website is wrong. I need to amend it by:
1. substituting 9 months for 90 days. and
2. saying something about this being temp thru 12.31.2012

BUT

I don't change the language about the 6% being effective during military service, since the 1 year thereafter language only applies to mortgage loans.

Uh, HUD is concerned with mortgages, right? So yes, the one-year addition protection language would apply.

sO - I guess we would change the notice to read:
• The SCRA states that a debt incurred by a servicemember, or servicemember and spouse jointly, prior to entering military service shall not bear interest at a rate above 6 percent
during the period of military service AND FOR ONE YEAR AFTER LEAVING THE SERVICE. • The SCRA states that in a legal action to enforce a debt against real estate that is filed during, or within NINE MONTHS after the servicemember’s military service, a court may stop the proceedings for a period of time, or adjust the debt. In addition, the sale, foreclosure, or seizure of real estate shall not be valid if it occurs during, or within NINE MONTHS after the servicemember’s military service unless the creditor has obtained a court order approving the
sale, foreclosure, or seizure of the real estate.

This is what our notice says...

The SCRA states that a debt incurred by a servicemember, or servicemember and spouse jointly, prior to entering military service shall not bear interest at a rate above 6 percent
during the period of military service. In the case of a mortgage loan, the 6 percent cap extends to one year following the end of the military service.

We also stay 9 months as well.

Ahkcompliance - thanks, that was what i was looking for, i appreciate it.

While reviewing our SCRA Policy I came across this statement,

The SCRA requires creditors to provide notice to all homeowners in default of the mortgage and foreclosure rights of servicemembers and their dependents under the SCRA within 45 days from the date that a missed payment was due and includes a required format.

Are we required to give this notice to all homeowners or just those who have given us notice that they are on active duty?

We give to all since we don't know who may or may not be on active duty.

We do not have many military customers (less than 5) and have only been notified once within the last 10 years. This is all still relatively new to me since we do not use it. That being said, we still need to comply with the law and if we need to make changes now is the best time.

You should provide it to all. The purpose of the notice is to notify the consumer of their potential rights under the SCRA if they are a servicemember. Not all servicemembers will notify you they are on active duty so you have no way of knowing which consumers may be covered by the SCRA.

So is this the correct SCRA notice verbiage for the "9 months" amendment:

" The SCRA states that in a legal action to enforce a debt against real estate that is filed during, or within 9 months after the servicemember’s military service, a court may stop the proceedings for a period of time, or adjust the debt. In addition, the sale, foreclosure, or seizure of real estate shall not be valid if it occurs during, or within 9 months after the servicemember’s military service unless the creditor has obtained a court order approving the sale, foreclosure, or seizure of the real estate." (Emphasis added - just to show specific text that was changed)

Both previous references to 90 days should be updated to 9 months? Just wanted to doublecheck this. Thanks.

That is correct.

Is it really okay to amend the language in the notice if the regulation (12 USC 1701x(c)(5)(A)(ii)(IV)) says to provide a notice "written in plain English by the Secretary of Housing and Urban Development, in consultation with the Secretary of Defense and the Secretary of the Treasury"?

This seems very similar to the requirement to use an unmodified version of FDIC's notice of unlimited insurance coverage even though it currently says IOLTAs are not included.

The problem is that HUD isn't the agency that will examine you for compliance, and it's not known for staying on top of this particular issue. Your regulator can cite you for not updating the wording, and make it stick.

As for the IOLTA thing, no agency other than the FDIC will worry about that notice, and the FDIC knows about the problem.

I just came across an updated version under HUD and it appears to have the correct language, except the one-yr period doesn't specify mortgage related loans.

http://www.hud.gov/offices/adm/hudclips/forms/files/92070.pdf

The expiration date is 7/31/2012 on this new notice, but wasn't it extended to 12/31/2012? Do you think it would be okay to fix the expiration date and add language to the "one year after service" that it applies to mortgage related loans?

On the other hand, how often are notices we are given to use not exactly perfect, but we still use them for safe harbor purposes.

This morning's ABA newsbytes.

HUD Updates SCRA Notice
The Department of Housing and Urban Development has updated its Servicemembers Civil Relief Act notice -- new form HUD-92070 -- to reflect the expanded protections required by the Housing and Economic Recovery Act and Helping Heroes Keep Their Homes Act. Banks should begin using the new HUD notice immediately. The changes in the new notice are amendments to SCRA’s Section 527 (maximum rate of interest on debts incurred before military service) and Section 533 (mortgages and trust deeds) that provide military members with additional time under each of the two protections.

The new notice must be sent to all homeowners -- even those not in the military -- who are in default on a residential mortgage. It must be sent within 45 days from the date a missed payment was due, unless the homeowner pays the overdue amount before the expiration of the 45-day period.

http://www.hud.gov/offices/adm/hudclips/forms/files/92070.pdf

Is there a Word copy of this anywhere, or do we just have to retype to insert our info?

Braincramp - what section of the law requires this notice?

We'll have a Word version for you by the end of the day.

Bravo!!! BOL to the rescue.
A true friend to the banks,

http://www.bankersonline.com/tools/tools.html Newest Tools


There is a Word form that you can customize in the "Lender place your name here..." slot and the HUD form itself in PDF which is only really good for showing that the Word form conforms.

Done and sent to the printer, thanks Andy.

Does this notice get sent out on all Real Estate Loans or only 1-4 family homes? What about commercial RE of service members?

Has it always been a requirement to send this to all delinquent mortgage borrowers even those not in the military?

Ditto Bville's question. When did this come about, and please don't tell me decades ago! Forever, we've been sending the Homeownership Counseling Notification, which was a generic mention of homeownership counseling on our delinquent, single family, residential dwelling secured past-due letters, with HUD's toll free telephone number (1-800-569-4287). Four years ago this month, we added a second sentence and a different toll free number (1-800-342-9647) for our military servicemembers and dependents.
What have I missed? Are we supposed to be sending the form HUD-92070 to ALL past due mortgage borrowers, regardless of any military affiliation, even though that form is strictly worded for the military?

You send it to all borrowers with loans secured by their principal residence because you will not know who all may be a servicemember or a dependants of servicemembers.

At my previous employer, in addition to sending the notice if loan was delinquent, we sent in origination package to make sure borrower was aware. Does anyone else do this? Thanks!

Does anyone know if this notice has to be in this exact format? We have the language on a notice in our system, but I don't think it's in that format when it prints out.

Is this effective immediately?

I don't find a press release or other information on it, but I believe it should be used immediately.

I don't know if vatiations on format are allowed or not. My guess is you must communicate this information and it should be clear and conspicuous.

Here's a 2006 mortgagee letter from HUD about the SCRA notice. It said it had to be given out for conventional loans and not just FHA loans. http://www.hud.gov/offices/adm/hudclips/letters/mortgagee/files/06-28ML.doc This might give you some historical information about the requirement to provide the notice.

Thanks, Andy. Our notice has the exact verbiage, but the format is not exactly the same. It's been reviewed by examiners in the past with no problem, but we all know what that's worth in the long run.

Just trying to get this straight. Even though the HUD form does not specify, the one year extension of the 6% rate only applies to mortgages , correct? Can we add language specifying that? Or would we be risking safe harbor?
Also, do we need to leave the headings as they are at the top? Or can we re-name and add out bank logo?

Upstate, this notice is only required for loans secured by a residential mortgage and HUD is assuming the notice is not sent to anyone else so they presumed referencing RE loan was not necessary.

But we all know in everyday life someone is going to say well we got this letter and it said that. We left the RE reference in our version.

Thanks, that's my fear too. Even from a training standpoint, it's confusing. I'm going to put the reference to residential mortgages in to avoid this.

Other than the dates, what actual changes to the form have been made?

Going back to a previous question asked. Does this only apply to a consumer closed-end loan secured by the primary residence? Should the notice be given in the instance of a business loan secured by a guarantor's primary residence, or for a business loan secured by a residence to be used for investment purposes? The information just states residential mortgage.

Date in the lower right corner on the Word version looks like 2022. Typo?

That was a typo. It's being corrected.

The notice is in need of one more correction... and please do not hate me for typing this because I am well aware that what I am about to write makes no sense.
This was passed on to me by our FDIC examiner (here last week), AND I verified it with Military One.

Military One's Outside the US dialing instructions/# shoud be changed from
1-800-342-9647
to
1-800-3429-6477

I have never seen a number like that, and yes I have lived outside the US before. Go America (despite its growing bureaucracy)

I am wondering the same thing. Does anyone have any guidance?

In the fourth section, I will add the name and address of our bank. They also list contact information, but it does not make sense for them to provide a written request by phone. Do you add your website?

We have to manually type this notice so it prints on the back of our notices. Do we need the OMB, expiration date, HUD form number and revision date?

Is there any type of grace period or do we need to send new notices to the customers who received the new notice since these changes were signed into law? Since the new form came out?

HUD called me back and the OMB info, as an example, is a part of what's new. I believe it should be included. They offered no real information on when it was to be used, but I would change out my old notices ASAP.

Joe - where did you get the new number for outside the US? I might add it, but I'd be hesitant to replace it simply because it varies from the prescribed notice. There might be a plan to add that number that was published.

Not sure if it's been corrected but if I recall correctly when these notices first came out the 1-800-3429-6477 phone number (or one of them) connected you to a very "friendly" operator.

I was given this number by our examiners last week. They told me HUD got it wrong. I did not believe that the number that they gave was actually a phone number. So, in addition, I double checked with Military One (the people that the number is for). The lady at Military One was herself suprised, but she said that the number with the extra 7 is the number to call when calling from overseas.

In terms of the "friendly" call, the FDIC examiner said that the "friendly" ladies were who you reached if you did not add the extra 7.

-Just doin what I am told

Don't you love it when the examiner contradicts the prescribed form. Srt of puts you between a rock and a hard place.

FWIW I am trying to do some verifications with HUD on this.

Military OneSource does confirm the number on their website. The lady I spoke with was not aware of the overseas number, but I did find this in their FAQ section.

Q: How do I find out more?

A: Call Military OneSource at 1-800-342-9647 (CONUS), or 800-3429-6477 or 484-530-5908 (OCONUS). For more information on calling Military OneSource from overseas visit www.militaryonesource.com and click on “Contact Us.” A consultant can give you more information about online consultations and discuss your options with you.

Anyone going overseas anytime soon? 50/50 chance at getting a "friendly" person on the line.

so, do we or don't we need the extra number?? Honestly, it looks like a typo from the 9647 to 6477.

My own opinion is I would add the additional number. Using a belt and suspenders risk managment attitude, that isn't a significant variance and is meaningful as to reaching a good number. The company that does the counselling has that number on their site and has said it was a good number.

HUD has my request for verification. But I won't hold my breath on waiting for an answer. These things take time. Factor in that regulators are aware of this, and I don't see them citing banks for the variance.

HUD posted an updated SCRA notice. They corrected the phone number to dial when calling from outside the U.S.

http://www.hud.gov/offices/adm/hudclips/forms/files/92070.doc
http://www.hud.gov/offices/adm/hudclips/forms/files/92070.pdf

Too bad there is not a way for banks to cite HUD with a violation and somehow force extend comment periods or just delay the effective date for new actions.

Looking at the latest version, it appears the first bullet under the "What Legal Protections" was also revised?

I am updating our notice now. It will be available for download in just a minute.

These changes were made because of JoeCompliance and BOL contacting HUD. Now the info is correct!

http://www.bankersonline.com/tools/lender/hud_scra.html

Going back to a previous question asked. Does this only apply to a consumer closed-end loan secured by the primary residence including Home Equity Loans? Should the notice be given in the instance of a business loan secured by a guarantor's primary residence, or for a business loan secured by a residence to be used for investment purposes? The information just states residential mortgage.

I would say that it does apply, when that borrower could now be protected under the SCRA.

The HUD form now just refers to the Military OneSource website and does not have the (wrong-looking) international number. I'd swear it was there yesterday and was stated to me that it was as well, from HUD.

I'm thinking it was changed again.

Does anyone know if HUD issued any kind of press release informing banks that the notice was updated?

They didn't issue a notice when it was updated in January. It shows on the HUD Clips as be a new item.

http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/whatsnew

I've updated the BOL form to match the one HUD has there now. That is, the international number has been removed and the SM is referred to the OneSource website. Lets hope all the soldiers who get mail have an internet connection.

Just when you thought it was safe--and I sent out corrected language yesterday--they changed it once again today. Now the bullet reiterates the url for military onesource, instead of just referring to "the above website".

Think they're done tweaking yet? At least it now has a March version date!

Thanks!!! Typical from HUD.

Of course, it's the government, we have to handle everything they do at least 3 times.

Thanks, everyone, for keeping us updated on this! BOL is absolutely your best friend when it comes to compliance and keeping on top of the myriad of mind-numbing regulatory changes.

FWIW I have updated our page. I'm not sure if this is an exercise in futility though since they also make it available now in Word form. Originally it was just a PDF.

Thanks for all the great information on this topic. I cut out any confusion, who and when are we required to send this disclosure to?

We combined this notice with the counseling notice that goes out to anyone that is 30 days past due. Since our system automatically generates a past due notice at 30 days (the SSCRA notice is required by 45 days) it was easiest and more cost effective to just include with a notice that was already going out.

Checking the HUD website again today just to confirm it's not still a moving target--the link on HUD Clips is now dead, and the only other place I could find the form on the HUD website still has the OLD version. Wonder if that means they're working on changing it yet again...

I got a call from a banker today who called HUD because he too was checking for updates. A HUD rep told him the forms were pulled pending review of the text by the DoD.

What does that mean? It means you are required to send a notice, but no one currently will say what that notice should say.

My best estimate at this time is to send what was last available. Your other option is to send nothing, and you know that won't work. The choice is obviously yours. The whole thing has been frustrating.

It is back under 92070.

http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/hudclips/forms/hud9

Do we dare use this one now????

Did you notice that the PDF version has a revision date of 1/11 in the lower right hand corner and that the Word document has a 3/11 date?

Make sure you are sending the notice to all borrowers with loans secured by any 1-4 residential home - regardless of loan purpose and lien position. We were not sending these to our commercial borrowers and were cited by our FDIC examiner because HUD does not exclude business-purpose loans from the notice requirement. For example, a servicemember could have a home in PA but be stationed in Georgia. Many time the servicemember will rent out their residence in their home state and buy another home near their duty station. If the home in PA is secured by a mortgage, the servicemember's rights under the SCRA are to be apply to the house in PA they are renting out as well. Our commercial loan delinquency notices are handled by a different department than our residential loans, so we were not complying with the notice requirement on the commercial side.

The two forms are different. The pdf has the phone number and the word doc has the website. Are they really ever going to get this right?

I'm not seeing the form on HUD Clips?

HUD-92068-A Monthly Delinquent Loan Report (10/2006))
HUD-92080 Mortgage Record Change--Multifamily (10/05)

same as of this AM. Andy, is it possible that someone at HUD read this thread and realized that the DOC and PDF versions aren't in sync?

; )

This page on HUD's website has a link to a PDF version of the notice but it is the one dated 1/11. http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/nsc/qasscra1

what about (found yesterday, after a lot of digging)
http://portal.hud.gov/hudportal/documents/huddoc?id=DOC_35467.doc

or is that out of date, too?

What a joke. HUD can't even post a simple one-page form correctly on their web site, and yet they now require regulated, examined institutions to submit a detailed audit report annually to them.

while you can get to that Word version via the hyperlink, you can not find it if you simply use the search box on hud.gov. Unbelievable.

and, although the Federal Government really pushes www.militaryonesource.com as the single best reference to answer all types of non-combat questions and concerns, it's tough to find a quick, short link to its information on SCRA. : (

I know that the HUD SCRA notice is for residential loans.

I've searched and searched, but can't find this....

Is there a required notice that must go out to delinquent borrowers on other consumer purpose loans, like auto loans??

I've seen no requirement or suggestions for other loans.

Ok - so it's not required.

Would it be wrong to include a short statement about calling us if you are on active duty on letters to delinquent borrowers for other loans??

We have a affiliate that only has other consumer purpose loans, cars, boats, RV's. Trying to figure out if a statment should/could be on their letters too.

Thoughts???

[PDF] Servicemembers Civil US Department of Housing Relief Act and Urban ... ... Legal Rights and Protections Under the SCRA Servicemembers ... App. §§ 501-596) (SCRA).
Who May Be Entitled to Legal Protections Under the SCRA? ...
portal.hud.gov/idc/groups/chco_admingrp/documents/document/doc_13065.pdf.pdf - 2011-04-03 - Text Version


so - is this the latest, correct link to HUD 92070?

Honestly since they posted, revised and pulled, I don't know what HUD would say is the latest. By the date, that wouldn't have been. I don't believe they know at this point.

Jacks, I don't know if MilitaryOnesource would answer questions or assist on non-mortgage debt, if they'd impose a fee or what. I assume (yes, I live dangerously) that OnsSource is a contractor and bills DoD for the records they submit.

Apparently it has disappeared again. Does anyone know what is going on and which version we should be using?

There is no good answer. Personally because you are required to provide a notice, and do not suspect any major errors were evident, I would use the latest we had. I think it is better than nothing. Obviously on the other side of the coin it was pulled for a reason. But at least the notice of free counselling is being sent this way.

As to an official version, currently there isn't one. Whether that is a good reason not to send it as required is any one's call. :p

The shame of it is that it is required and presumably has a purpose, but the message that HUD is sending is that it is of no importance.

And I'm sure the person that HUD listed to contact for questions will be extremely pleasant and helpful....

HUD-92070 Servicemembers Civil Relief Act Notice Disclosure
(This particular form is temporarily unavailable at this time. If you have any questions regarding this form, please contact Camille Acevedo at (202) 708-1793 x5132 per the program office contact.)

HUD has updated the form. I've updated the BOL tool and have a PDF version denoting the differences between the March and June versions. They are signficant. On our Word verion, I corrected a HUD typo.

http://www.bankersonline.com/tools/tools.html

Thanks, Andy! As nuts as it is trying to keep up with the various iterations of the HUD notice, I can't imagine doing it without BOL's help!!!

Nut's is right Sinatra Fan. Not that I doubt BOL (never!) but I haven't found the revised form on HUDs website. Anyone found it there yet?

RAnt- Our core provider fixed YESTERDAY the previous change. ARGH! End Rant.

There's one other typo in the Word document downloaded from the HUD site. The last paragraph refers to the "Unites States." We're making that change to the BOL Tools version of the document.

"DUH" strikes again.

Another poster gave us http://portal.hud.gov/hudportal/documents/huddoc?id=92070.doc but it has a couple typos.

You won't find it if you just search on "SCRA" on the HUD website. Andy's link is best, but - duh.

Thanks guys. It's too bad that HUD doesn't have spell-check on their computers.

Any idea how long we have to start using the new one?

I'm trying to find out as well. Not that it really matters since most likely they will change it again a few weeks after we adopt these changes.

The requirement hasn't changed. HUD simply isn't and hasn't made the notice available because there were discussions between HUD and DoD(?) as to what the notice should say. I would start using it ASAPractical.