MPF Xtra® Training:Specialized Loan Servicing

Training Courses  
Selling & Delivery

Closing

It’s the big day for your borrower!

It’s also an important milestone for your institution, as this is the final step before selling the loan to MPF®. During this stage, we will cover the steps you will need to complete to close your loan.

How it Works

  1. Allow sufficient time for pre-funding certification.

    Once the loan is closed and ready to sell, each MPF Xtra custody file will require pre-funding certification by the MPF Document Custodian. The closer needs to be aware of the pre-funding certification time frames; an extension may be needed.
    • Between the closer, the loan funder and the post-closing shipper, ensure there is no less than 7 business days from the custody file ship date to the lock expiration date. The seven days allow for pre-funding certification and purchase by MPF (4 days for the  pre-certification review + 3 days for purchase= 7 days).
    • MPF must purchase MPF Xtra loans no later than 3:30 PM CT on the day of price/lock expiration.
    • An extension may be needed to meet the seven business day time frame. 

  2. Proceed with your normal closing procedures.

    • Meet all regulatory requirements.
    • Review the SLS Whole Loan Servicing Transfer Manual for servicer specific requirements.
    • Include SLS Fees: 
      • Tax Service Fee: $80.00
      • Loan Boarding Fee: $150.00
      • Pay all taxes, delinquent taxes or insurance payments due within 60 days before or after the sale date.
      • Escrow Wavier Fee is an adjustment to the Service Release Premium (SRP).
      • SLS requires the collection of escrow reserves be for the maximum cushion allowable by the serviced loan documents or state law, whichever is lower.
      • Escrow funds will be netted from the purchase by MPF.
      • No cushion is required for private mortgage insurance.

      • Provide borrower with the Notice of Servicing Transfer (Exhibit 2 and section 3.4 of the SLS Whole Loan Servicing Transfer Manual) or equivalent document at closing, or as required by RESPA and other applicable laws. This document must include an accurate effective servicing transfer date. Effective date of the Servicing Transfer is equal to the date the first payment is due to SLS.

    • Prepare the closing documents.
      • The loan will close in your institution’s name.
      • MPF does not require any program specific forms.
      • If tax transcripts were not obtained for the underwriting decision, the borrower(s) must sign a 4506C at closing.
    • Be sure to use only the most current Fannie Mae/Freddie Mac uniform instruments.
      • Use the Multi-state Fixed Rate Note FNMA/FHLMC 3200.
        • Must use 5% late charge after 15 days unless state law states differently.
        • MPF prohibits prepayment penalties on the first lien and any subordinate liens for conventional mortgages.
      • Use the FNMA/FHLMC state-specific Mortgage or Deed of Trust (based on property location).
        • MERS members may use a MOM Mortgage (see MERS information below).
      • Use the following FNMA/FHLMC riders if applicable:
        • Multiple units require the use of 1-4 Family Rider (FNMA 3170)
        • PUD Rider (FNMA 3150)
        • Condo Rider (FNMA 3140) 

        • Second Home Rider (FNMA 3890)

    • SLS requires you to be a MERS member. Refer to the SLS Whole Loan Servicing Transfer Manual for more information.

Your Responsibilities

  1. Meet all federal and state regulations.

  2. Close with the borrower(s).

    • Serviced loans purchased ON or BEFORE the 12th day of the month
      • First borrower payment due to SLS - 1st day of the next month
      • Effective date of servicing transfer - 1st day of the next month
         
    • Serviced loans purchased AFTER the 12th day of the month
      • First borrower payment due to SLS - 1st day of the month after the next month
      • Effective date of servicing transfer - 1st day of the month after the next month

Examples:

Tip: Example Closing Scenarios