Home Loan Servicing Update

Home Loan Servicing Update - January 2006

BANKRUPTCY ABUSE PREVENTION AND CONSUMER PROTECTION ACT OF 2005

As you are aware, on April 20, 2005 President Bush signed into law the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. The majority of the changes became effective with bankruptcy cases filed on or after October 17th, 2005. Included in these changes are Reaffirmation Agreements. The requirements of the old reaffirmation agreements have been eliminated and have been replaced by explicit, required language including required font for certain terms such as annual percentage rate and amount being reaffirmed. Please be advised that you are required to abide by these new laws. Please consult your legal council to ensure that you are preparing the reaffirmation agreements correctly for adequate protection. WHEDA requires reaffirmation agreements be sent out on all chapter 7 filings. It has been our experience that the majority of our mortgages allow for this to be a recoverable cost. This should be determined by your legal council with review of the mortgage documents.

TAX SEASON

Just a reminder that all taxes both current (2005) and outstanding/delinquent must be paid in full on all WHEDA accounts. This includes accounts that are in a foreclosure or bankruptcy status. If the borrower's escrow balance is not sufficient to cover the amount, you as the servicer, are required to advance your own funds.

WHEDA AUDIT

While the final results of the annual audit are not complete, we have noticed a resemblance in a few areas that do not appear to be monitored. These areas are as follows:

Owner Occupancy

Hazard Insurance on Condominium Units

Escrow Accounts

Please review the WHEDA servicing manual for information on the above items. It is mandatory for all WHEDA accounts to be owner occupied. Also, all loans must have an escrow account set up for Taxes, Insurance (including Condo Contents/Condo Association), and Private Mortgage Insurance (if applicable).

WHEDA would like to thank those of you that have been working hard to complete the annual audit requests. We value our partnership with you and appreciate your efforts.

DELINQUENCY RATES - 4TH QUARTER

2005		Portfolio	30 Day	60 Day	90 Day	Foreclosure	Bankruptcy
OCT	W	1.46%	1.18%	0.21%	0.07%	0.32%	0.77%
	L	2.41%	2.08%	0.27%	0.06%	0.33%	0.91%
	T	2.11%	1.79%	0.25%	0.07%	0.33%	0.86%

NOV	W	1.38%	1.07%	0.22%	0.09%	0.35%	0.77%
	L	2.46%	2.12%	0.29%	0.05%	0.37%	0.90%
	T	2.12%	1.79%	0.27%	0.06%	0.36%	0.86%

DEC	W	1.36%	1.12%	0.11%	0.13%	0.40%	0.70%
	L	2.55%	2.15%	0.33%	0.07%	0.41%	0.85%
	T	2.17%	1.82%	0.26%	0.09%	0.40%	0.80%

(W = WHEDA L = LENDER T = TOTAL)