Chase Banking Mortgage Training Guide

Loss Mitigation for Prime Collections

Home Lending Training

Private and Confidential © Copyright 2008 Warning: Proprietary Information. Not to be reproduced without the authorization of Chase Home Finance LLC.

File Name: J:\Default L & PS\Courses Under Development\Loss Mitigation for Collectors\Current Materials\LG_EssentialsLossMitigationNP_2008072808.doc Revision Date: 1/6/2009


DL&PS Default Home Lending Prime Collections

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Table of Contents

How To Use This Guide............................................................................................................. iii Introduction .............................................................................................................................iii

Unit 1: Overview of Homeowner’s Assistance Department.................................................... 5 Introduction ............................................................................................................................. 6 Meaning of Loss Mitigation .....................................................................................................6 Purpose................................................................................................................................... 7 Mission.................................................................................................................................... 7 Loss Severity........................................................................................................................... 7 Loss Mitigation Resolution Groups ......................................................................................... 8 Loss Mitigation Job Roles ..................................................................................................... 10 Knowledge Check ................................................................................................................. 11

Unit 2: Borrower Interview ....................................................................................................... 13 Borrower Interview ................................................................................................................ 14

Borrower Information....................................................................................................... 14 Reasons for Delinquency ................................................................................................ 14 Income ............................................................................................................................ 15 Expenses ........................................................................................................................ 16

Analyzing Financial Data.......................................................................................................16 Knowledge Check ................................................................................................................. 17

Unit 3: Workout Options........................................................................................................... 19 Introduction to Workout Options............................................................................................ 20

Options to Retain the Property........................................................................................ 20 Options to Liquidate the Home........................................................................................ 23 Positive and Negative Consequences ............................................................................ 25

Unit 4: Early Loss Mitigation.................................................................................................... 27 Early Loss Mitigation ............................................................................................................. 28 Referral Procedures .............................................................................................................. 29

Collection Referral Procedure ......................................................................................... 29 Scripting for Workouts..................................................................................................... 32 Repayment Plans in ER .................................................................................................. 33

Modifications ......................................................................................................................... 35 Determine Customer Willingness.......................................................................................... 36

Unit 5: Communicating to Customers .................................................................................... 39 Communicating the Process to Borrowers............................................................................ 40

Practice Activity............................................................................................................... 42



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How To Use This Guide

Introduction This training manual is yours to keep and personalize for your own unique learning needs. The manual contains instructions, exercises, examples, definitions, and job aids you need in this class. In addition, your instructor may provide additional training materials throughout the class.

In addition to the content included in this manual, you are encouraged to take notes. Feel free to take notes directly in this manual or highlight important content areas. By personalizing this manual to you and your specific needs, you’ll have your own personalized training and reference manual to use after you complete this class. You will find this helpful back on the job whenever you need to refresh your memory on what you have learned during this class.

Although there are several examples included in this manual, the examples do not contain actual customer information. Names, addresses, account numbers, and personally identifiable information have been randomly altered. Any similarity to actual people or accounts is purely unintentional.

How is this guide organized? The course itself consists of units of study, each of which is comprised of one or more content areas. Your facilitator will refer you to the appropriate section in this guide, or provide you with the necessary materials in which to complete a particular task.

What do the graphics mean? The following graphics call your attention to important information.

An exclamation point represents an Important piece of information

A key represents an important learning point to remember that will assist you in understanding the Key Concepts of the unit.

A light bulb represents a tip to help you with your training. Try to remember these Tips and note them for future reference.

A book represents an Activity that you must complete as part of your training.

An arrow with the word New indicates that this is a new step performed by your work group.

NEW



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Unit 1: Overview of Loss Mitigation (Homeowner’s Assistance Department)

1 1.

This unit allows you to:

Define the meaning of loss mitigation.

State the purpose and mission of the Loss Mitigation (Homeowner’s Assistance) Department.

Explain “loss severity”.

List the roles in the Loss Mitigation (Homeowner’s Assistance) Department.



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Introduction Collectors provide a vital service at Chase.

Investors count on us to protect their interests.

Chase shareholders expect us to collect funds that are due to meet revenue projections and protect stock prices.

Chase relies on us to establish healthy relationships with our customers protecting the long-term interest of the company.

Customers seek our assistance to:

assist them bring their home loans current helping them to retain their homes.

negotiate special payment plans when special consideration is appropriate.

educate them on the policies that affect their loans.

There are times when homeowners get so far behind on their payments that there is nothing more Collections can do to assist. If the homeowner is cooperative and wants to work something out with Chase, then it is your responsibility to forward the account to the Loss Mitigation (Homeowner’s Assistance) Department. The purpose of this course is to provide you with an overview of the department and discuss processes and procedures to transition customers from Collections to Loss Mitigation in a transparent manner.

Meaning of Loss Mitigation In your groups, discuss and record your understanding of the term “Loss Mitigation”.



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According to the dictionary, mitigate means to make less harsh or less painful. Loss mitigation is a process where the lender tries to help the customer avoid foreclosure. The process includes activities designed to reduce the potential financial loss to the lender in the event the borrower defaults on the loan.

In the world of home loans, the loss can occur for the borrower, the lender, or both. If customers are unable to make their payments, they may lose their homes, good credit, and equity. At a minimum, lenders lose interest on the loan and attorney’s fees.

Purpose The purpose of the Loss Mitigation department is to assist homeowners find the most appropriate resolution to the delinquency and avoid foreclosure. This department is also called the Homeowner’s Assistance Department (Prime only). It offers alternatives to foreclosure. They work with the homeowner, investor, and mortgage insurance company mitigating the potential losses to Chase.

Mission Providing counseling and workout strategies to customers while maximizing loss mitigation opportunities for the investor is the mission of the Homeowner’s Assistance Department.

Loss Severity Loss severity is an indicator of the amount of loss that Chase suffers if a home is sold at a foreclosure auction. If the loss is severe enough, the Loss Mitigation Counselor may send the account to the Loss Recovery department for a possible charge-off instead of sending the home through a foreclosure auction.



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Loss Mitigation Resolution Groups

First Contact: As its name implies, this group provides the first contact with customers who may be interested in a loss mitigation workout option. This group handles all incoming loss mitigation requests referred electronically from e-mail, faxes, and mail. After reviewing the referral, a specialist from this group contacts the customer by phone to obtain additional information. The specialist uses both the electronic data and the additional information collected from the customer, to populate the account file in the EarlyResolution (ER) computer system. Then the specialist refers the account to a Loss Mitigation Negotiator.

Early Loss Mitigation (ELM): This department works with a diverse group of customers who would like to, or may need to adjust the terms of their mortgages due to changes in their circumstances. The group receives customer account referrals from Customer Care, Collections and other Default departments. Consequently, the customers that ELM works with range from people not in default, to people who are in foreclosure but not within 15 days of their foreclosure sale date.

An Early Loss Mitigation Specialist contacts each referral customer, reviews his or her account in the servicing system, and determines if the customer pre-qualifies for a workout option. A customer pre-qualifies for a workout option if the he or she meets specific criteria based on investor and insurer guidelines. For each customer that pre-qualifies, the specialist collects necessary documentation and refers the customer to the Loss Mitigation group.



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Streamline: Some customer accounts that enter the Loss Mitigation process are reasonably uncomplicated. That is, the workout action to assist some customers is straightforward. For example, a customer not yet in default may request assistance via e-mail, fax, or mail; the person meets the workout option criteria, and he or she is interested in a repayment plan. Assistance for this example customer would not have many issues. The customer needs to be set up on a repayment plan.

The intent of the Streamline group is to move the “straight forward accounts” through the loss mitigation process more quickly. If a loan meets specific, straightforward criteria, a Streamline group member may be able to initiate and close a workout option without any phone contact with the borrower.

The specialist may be able to:

1) review the criteria information provided electronically by the customer,

2) generate the paperwork for a modification or repayment plan, and

3) send the paperwork to the customer.

Note: The only workout options that Streamline Specialist’s can implement are loan modifications and repayment plans.

Negotiations: This group works with customers to discover the best workout option for their particular situation. Group members (called negotiators) use their communication skills and product knowledge to find the best solutions. Chase subdivides the group into two specialized teams. One team works with customers who desire to retain their homes. The other team works with customers who want to liquidate their property.

Repay Follow Up: Once a repayment plan has been set up for a customer, this group monitors the account. Monitoring of accounts occurs so that Chase can determine whether payments are paid in accordance with the repayment plan terms. Team members send letters to customers if plan payments are past due. They also refer accounts back to a negotiator if a new repayment plan needs to be initiated.

Doc Prep: This group is responsible for preparing all documents for customer signature in the workout process. They work closely with the other groups to make sure the proper documents are sent to our customers for signatures. They ensure that the documents meet State, County, Investor and Insurer guidelines so that the documents will be accepted for recording. Team members also proof all documents for worksheet errors such as conflicting contribution amounts, incorrect payments dates and amounts; incorrect spelling of the customers name and any other mistakes that would disrupt the workout option process.



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Closing: Members of this team perform the final actions necessary to complete the paperwork and system procedures for a customer’s workout option. Closing team members receive documents signed and returned by customers and place the paperwork in the proper file. Upon receiving the returned documents, the team member initiates computer system changes. Then, the person closes the account file and submits it for imaging.

Note: If a customer does not return required documents with signatures in a timely manner, this group must decline the account file which nullifies the workout option. The customer would have to restart the workout option process if still interested.

Loss Mitigation Job Roles The primary job roles in the Loss Mitigation team are:

Specialists: Provide administrative assistance to all team members. Contact

customers to obtain needed informationaaaaaaaaaaaaaaaaaaaaaaaaaaaaa.

Negotiators: Work accounts designated for refinancing, short sale, daeed-in-

lieu or modification curesaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa

Management Roles

Supervisor: Manage teams of 8-10 individual contributorsaaaaaaaaaaaaaaa.

AVP: Manage group of 5-8 Supervisorsaaaaaaaaaaaaaaaaaaaaaaaaaaaaa.



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Knowledge Check Select the best answer(s) for each question.

1. Given the meaning of loss mitigation what is the purpose of the Loss Mitigation (Homeowner’s Assistance) Department?

a. Assist customers who do not qualify for government assistance to help retain the home.

b. Explain the process of retaining or relinquishing the home to customers.

c. Assist homeowners find the most appropriate resolution to delinquency and avoid foreclosure.

d. Minimize loss severity for the company.

2. During an inbound call, a customer tells you that he is currently working someone in Loss Mitigation on a refinance that has been initiated. Given this scenario, what is the name of the job role the customer is working with?

a. Supervisor

b. Loan Counselor

c. Specialist

d. Negotiator



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Match the resolution group in the left column with the job function they perform in the right column.

Answer Group Job Function

1.Repay follow up

A. This group handles all incoming loss mitigation requests referred electronically from e-mail, faxes, and mail.

2. ELM B. This group works with customers to discover the best workout option.

3. Streamline C. This group monitors accounts for payments and adherence to plan terms.

4. First Contact D. This group prepares all documents for customer signatures.

5. Negotiations E. This group contacts each referral customer and reviews their account in the servicing system to determine whether the customer qualifies for a workout option.

6. Doc Prep F. This group moves straight forward accounts through the loss mitigation process.



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Unit 2: Borrower Interview

2


Understand how loans are evaluated for eligibility.

Identify sources of income.

Identify common expenses.



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Borrower Interview Loss Mitigation Specialists provide counseling and workout options to customers experiencing difficulty maintaining their monthly mortgage payments. Workout options are based on the status of the loan and the loan type. The specialist attempts to contact the borrowers listed in the queue, by phone. The specialist collects necessary information from the borrower and recommends a workout option.

Borrower Information

What do you think are four key pieces of information that the specialist needs to collect from the customer to determine the best workout option for the situation?

aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa




Reasons for Delinquency

The reason for delinquency may affect the type of workout that is available to the borrower.

Short term — Short-term delinquencies indicates a temporary financial hardship.

Long term — Long-term delinquencies indicates a permanent financial hardship.



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Income What do you think are some of the sources of income to collect from the customer?

aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa






The borrower must provide paper-based documentation supporting the financial status.

Examples of documentation include:

bank statements

check stubs

hardship letter (if the customer states the RFD be used in the decision making process)

unemployment office letters



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Expenses We collect information regarding the borrower’s current expenses and enter the information into ER.

Expenses include:

additional lien costs

car payments

property taxes, if not escrowed

homeowners insurance, if not escrowed

Chase uses the IRS National Standard to estimate other household costs, such as utilities, groceries and other living expenses, based on the number of individuals in the household.

Analyzing Financial Data How does the specialist analyze the financial data? ER analyzes the borrower’s financial data determining the most appropriate workout option.

The system subtracts the borrower’s monthly expenses from the declared monthly income to determine the net monthly income. ER then compares the net monthly income with the required income for all the various workout options determining the best fit.



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Knowledge Check 1. A customer calls in and states that she can no longer afford the house her

payment due to the death of a close family member who was assisting with the bills. Given this situation, what type of reason for delinquency would this be considered and why?

Long Term – The customer has had a significant reduction in income in the

householdaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa.

2. List some examples of documentation that the customer must provide paper-based proof of to help qualify for a workout option.

a. Bank statementsaaaaaaaaaaaa

b. Check stubsaaaaaaaaaaaaaaa

c. Hardship letteraaaaaaaaaaaaa

d. Unemployment documentation

3. What is the formula for analyzing the customer’s financial data?

aaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaaa



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Unit 3: Workout Options

3


Restate the available workout options for retaining the property.

Restate the available workout options for liquidating the property.

Define the positive immediate consequences and negative immediate consequences of each workout solution.



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Introduction to Workout Options There are various options available to help homeowners. Some options minimize loss while helping a customer retain the home. These vary depending on investor guidelines.

The Homeowner’s Assistance professionals use a screening process and work within Chase policies and the limits of the law, determining the appropriate steps to resolve the customer’s issue.

Chase does not guarantee that a customer qualifies for a workout option; Chase reviews each situation on a case by case basis.

Options to Retain the Property

Repayment Plans Repayment plans are extended payment arrangements, usually consisting of three or more payments, adjusted to the customer’s financial status at the time the repayment plan initiates. The repayment plan is a structured signed written arrangement, much like a repayment plan in collections.

The customer repays the delinquent amount in installments or advances in addition to the regular monthly payment. Most repayment plans last 12 months; but, in some cases are extended up to 18 months. If the customer defaults during the repayment plan, the account returns to the appropriate department. Upon completion of the plan, the customer’s account is current and foreclosure proceedings dismiss (if in foreclosure prior to the repayment plan).

This workout is available to all loan types and it is the only option for VA loans if the borrower wants to stay in the home.

Homeowner’s Assistance Department repayment plans for FHA loans are called “Special Forbearance”.



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Special Forbearance Special Forbearance is a workout option used when the customer provides documentation indicating a temporary hardship. It is a written agreement between the customer and investor that allows the mortgagor to make reduced or suspended payments for a specific timeframe. Because of the high risk related to this type of workout, the investor is highly involved in the approval and set up of the forbearance.

The account does not have to be past due to qualify for a special forbearance. There is a higher possibility of an approval if the account is in good standing during referral to the Homeowner’s Assistance Department.

Homeowner’s Assistance Department needs to provide proof of the following:

proof that the customer will have the funds to reinstate the loan

proof of income to maintain the monthly payments after the forbearance

poof of surplus to qualify for a repayment plan to catch up or to afford higher monthly payments (if a modification of the loan is necessary after the forbearance period)

Most forbearances are approved due to a medical condition, but submission for the plan is not limited to that reason for default.

Special forbearances for FHA loans are set up as repayment plans. Reduced or suspended payments are not available to FHA loans.



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Modification Customers who are experiencing a long term financial hardship or reduction in income may qualify for a modification. Loan modifications occur when the Chase and the customer enter into a written agreement that permanently changes one or more of the original terms of the mortgage note.

Most modifications involve adding the past due interest, attorney fees and required escrow monies back to the outstanding principal and then re-amortizing (calculating the way the payment is figured) the payments during the remaining life of the loan.

Changes may include:

reduction in interest rate

extension of the maturity date

increase in the amount of unpaid principal balance due to delinquent interest or other advances (no write-off or reduction of the unpaid principal is allowed)

change in the product type (for example, modifying an arm loan to a fixed interest rate)

Partial Claim Partial claims are only available to FHA backed loans. Partial Claims are available to customers who have experienced a temporary financial hardship. HUD writes a check to bring the delinquent portion of the loan current. HUD then attaches an interest free note (in the check amount written) as a lien to the mortgage.

The customer must occupy the home as a primary residence and the loan must be at least 120 days past due. If the customer qualifies, then HUD is willing to write a check for up to 12 months of principal, interest, taxes and escrow. The customer must provide enough funds to cover the difference if the amount HUD pays is not sufficient to cover the delinquency.

The amount covered by HUD is non-interest bearing, and requires no monthly payments, but it must be paid once the first mortgage is paid off.



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Options to Liquidate the Home There are instances when the customer decides to respond to default by liquidating (do away with/turn into cash) the home. This may be due to personal circumstances or there simply may not be any other way to recover from default. In these circumstances, Chase offers several options to assist homeowners in liquidation.

Short Sale The following is a brief description of the short sale process.

1. The customer places their house for sale at the current market value.

must try to sale the home for at least 90 days at fair market price

must provide proof (in the way of offers) that the market does not support this price and buyers are not willing to pay as much

2. The customer receives an offer to purchase the house.

3. The net proceeds (sales price minus agent’s commission and all closing costs) are insufficient to pay off the loan in full.

4. The customer or their agent contacts Homeowner’s Assistance to ask if Chase is willing to accept less than the full payoff. When documentation is received by HAD, an appraisal or broker’s opinion is ordered. If this report agrees with the one provided by the borrower, then the file is submitted to the investor for approval.

5. The customer submits updated financial information to prove they cannot make up the difference between the payoff and the net proceeds.

6. Chase then asks the investor for the approval to accept the net proceeds.

7. The customer closes their escrow account, and Chase closes the loan. In some cases the original mortgagors are required to sign a note for the difference between the proceeds from the short sale and the amount owed. If the difference is forgiven, then the customers must report it as income to the IRS.

Note: If there are other liens against the property, the customer must get the lien holders to agree to release the liens without getting paid or the short sale is declined.

Chase does not offer short sales for second mortgages, even if Chase is the servicer.



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Deed in Lieu of Foreclosure The customer signs over the deed to the investor to avoid foreclosure. This alternative is a last resort and only accepted in extreme circumstances.

We look at a possible short sale as the first option.

Some investors require proof that the property:

has been marketed for a period of time at a fair market value,

and

attempts to sell the property are unsuccessful.

Upon approval for a deed in lieu, a cash contribution from the customer is sometimes required as compensation to the investor for some of the losses.

The mortgagor is released from further liability for the property; however, the deed in lieu negatively impacts the customer’s credit bureau history.



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Positive and Negative Consequences There are many immediate positive consequences, as well as, immediate negative consequences with any workout option.

For example, HAD and the customer determine that the best fit would be a repayment plan. One of the pics of the repayment plan is that the customer becomes current. A nic may be that the customer may discontinue the plan therefore causing some additional financial loss to Chase.

PICs and NICs Activity 1. Use the workout option that was assigned to your group earlier.

2. Discuss and list the pics (positive immediate consequences) and nics (negative immediate consequences) for the customer and Chase if that option is used as a workout.

3. You have 7 minutes to prepare your presentation. Be prepared to share the reasoning behind your results with the group.

PICs NICs

The financial benefits to Chase are significant as opposed the loss incurred if we pursue foreclosure and dispose of the property through REO.



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Unit 4: Early Loss Mitigation

4


Explain the Early Loss Mitigation Unit.

Identify which accounts qualify for assistance under Early Loss Mitigation.

Recognize the referral process for the ELM department.

Identify basic repayment plan information.



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Early Loss Mitigation What is Early Loss Mitigation Unit? The Early Loss Mitigation Unit was established to ensure that all customers are afforded the opportunity to continue the dream of home ownership. Through effective communication and quality underwriting, delinquent homeowners are placed into modified or new loan programs that are affordable and structured to promote long-term success. At the same time, we are protecting the integrity and profitability of the corporation and trust.

What Accounts Qualify for ELM ? ELM receives referral accounts from Collections based on the following criteria:

account 30 to 119 days past dueaaaaaaaaaa

documented hardship or reason for defaultaa

current financial information documentedaaa

customer has a surplus of incomeaaaaaaaaa

account currently not in foreclosureaaaaaaaa

account not in bankruptcyaaaaaaaaaaaaaaaa

When ER pre-qualifies a homeowner for a special workout such as loan modification, special forbearance, partial claim, etc., it is important that you properly inform the customer of the next step.

Let the customer know that after reviewing their financial situation the customer may be qualified to a HAD workout. Ask the homeowner if that is something they would like to pursue. You should not discuss the terms of the workout as they are not final.



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Referral Procedures Collection Referral Procedure

Collections verify and update the following using the ER system:

owner occupancy and property status

addresses and phone numbers (do not update in the ER system-use the host system to update)

reason for delinquency

financials

credit bureau report (if available)

credit bureau reports pulled within the last 30 days remain on the system

Property Status The property status is documented as follows in the Comments:

good condition

fair condition

poor condition



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Financials

Financials in ER consists of:

borrower and co-borrower income

expenses

summary (displays an surplus or deficit)



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Expenses

Collections gather the following information using a combination of the credit report generated by ER and customer interview.

Some expenses are pulled from the credit report others must be entered manually.

Food, utilities and transportation auto populate based on the number of people living in the household and the number of vehicles owned or leased.



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FHA Pop Up The informational pop up box displays for FHA loans. Do not use this information to inform the customer about workout plans. Use the scripting provided below.

Scripting for Workouts Use the following scripting to explain the workout options to customers.

Repayment Plans —A repayment plan is a structured, signed written agreement, in which you pay the delinquent amount in installments or advances in addition to your regular monthly payment (Note: This option is called Special Forbearance for FHA loans.)

Special Forbearance — A special forbearance is a written agreement between you and the investor allowing you to make reduced payments or to suspend payments for a specific period of time to allow you time to recover from a financial hardship. (Note: This is set up as a repayment plan for FHA loans.)



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Modification — A modification is where we adjust one of more terms of the terms of the original note to enable you to bring the loan into current standing. Generally, a modification makes your monthly payments increase slightly.

Partial Claim — A partial claim is when HUD writes a check to bring the delinquent portion of the loan current and then attaches a promissory note, in the amount of the check written) as a lien to the mortgage. (Note: this is only available to FHA loans.

Short Sale — In a short sale, the proceeds of a property sale are accepted in satisfaction of a defaulted mortgage even though this may be less than the amount owed in the mortgage itself.

Deed in Lieu of Foreclosure — The deed is given back to the lender to satisfy a defaulted mortgage. This alternative is only granted as a last resort, and is only accepted in extreme circumstances.

Repayment Plans in ER When a repayment plan is set up in ER, the system generates letters to the customer outlining the dates and amounts of the plan. It is important to restate the amounts and dates of the plan to the customer.

Note: For more information on ER and repayment plans, please refer to the EarlyResolution for Prime Collections training.

Customers can make their repayment plans using any the following payment methods:

FastPay

WU Quick Collect

ATM

Branch Pay

On-Line at http://chaseonline.chase.com

Mail



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As with any payment, FastPay and Western Union Quick Collect are preferred and should be offered to the customer as the first payment option.

Inform the customer that late charges, delinquency credit reporting, and collection activity (letters and possibly calls) continues during the repayment plan until the account becomes current. The customer can disregard collection notices as long as the repayment plan is followed.

ER sets up the best payment arrangement based on the customer’s available income. ER does not include future late charges and fees during the plan and may not include fees that are due the date the plan is set up. Let the customer know that they will still owe the late fees and that arrangements can be made to pay them at a later date.

When you negotiate the down payment for the repayment plan, do not ask for the minimum amount (as low as 35%). Use your negotiation skills to obtain as much as possible.

Advise the customer that payment must be made on or before their due date. Do not tell the customer that there is a grace period. Upon completion of the payment plan, the customer needs to be prepared to pay the next regular payment on the first of the next month.

If you contact a customer on an existing repayment plan, confirm the plan amounts and dates with the borrower and make arrangements for the current installment.



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Modifications Customers, who are not interested or do not qualify for a repayment plan, may pre-qualify for a Loss Mitigation (HAD) workout through ER.

Click Continue to proceed with the Loan Modification option.

EarlyResolution attempts to pre-qualify the customer for one of the several workout options offered through Loss Mitigation (HAD).

When you reach the Pre-Qualified screen, inform the customer that after reviewing their financial situation, they may be qualified for a Loss Mitigation (HAD) workout. Ask the customer if this is something they would like to pursue.

Do not read the information to the customer when ER pre-qualifies the loan for a workout. Inform the customer of the next step in the process, as shown on the following page.



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Sample Scripting for a Workout (Other than a Repayment Plan) “It appears that you are a good candidate for a workout option. Your application must go through an audit process to ensure compliance with the proper guidelines governing your loan. If the loan passes that audit, you will receive workout documents and a letter of explanation of the option within 10 -15 days. If any exceptions are identified, you will be contacted in an effort to work through those exceptions.”

Determine Customer Willingness

If the customer is interested in a workout plan, advise them to hold onto finds until they hear from the HAD department. The collector then selects the “accept plan” button in ER and tell the customer that someone from HAD will be contacting them regarding the workout. This allows the information to be captured and sent to HAD to be worked. Be sure to let the customer know that this process can take anywhere from 30 - 45 days.



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Set the next reschedule date in RE/KO or MSP for 15 days out.

If the customer is interested in the HAD workout and still wants to send in funds, then advise the customer that you cannot do both. If the customer sends in the funds, then HAD will not be able to do anything because the status of the account changes by the time the department receives the file.

If the customer is not interested in a workout option and fees that they can satisfy the account on their own, then you should select the “borrower not interested” button in ER and accept payment only within department guidelines. (Ex. 1 out of 2 payments or 2 out of 3 payments)

The customer has the option of updating their financials to see if ER displays a different outcome.

ER also prompts you to send a workout package for the customer. This is currently done using the host system and not ER.



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Unit 5: Communicating to Customers

5


Set appropriate customer expectations.

Identify what information is acceptable to relay to customers.



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Communicating the Process to Borrowers Why are you still calling me? I’m working with someone in Loss Mitigation.

Why is this process taking so long?

Chase is so difficult to work with!

Have you ever heard this from a customer?

These are common phrases that we hear when customers don’t understand how the referral process works. Our best defense for minimizing these types of calls is communicating appropriate expectations to customers when referring them to Early Loss Mitigation

Setting appropriate expectations at the beginning of the process assists in:

minimizing customer frustration.

decreasing customer escalations.

reducing inbound call volume.

speeding time to resolution.

Borrower Expectations – At Referral After gathering financial information, as indicated in the procedures documented above, be sure to clearly communicate the following expectations:

Average timeframe from referral to decision (30-45 days for review)

Steps to expedite the process:

return calls promptly

submit requested documentation promptly

Authorization letters are required for anyone we do not have written authorization to speak with including spouses. The letter or authorization must include the borrower’s name, property address, loan number and signature.



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Below is a script you can consider:

Thank you for providing this information Mr. Customer. I have updated our records and will be referring your account to HAD for review.

As part of the process, someone from HAD will be contacting within _____ business days and will ask you to forward copies of specific documentation. This can include things such as pay stubs, bank statements, and tax returns. The consultant will be able to provide you with a complete list of everything they require to evaluate your situation.

“There is no guarantee of approval on your application. We will contact you either by phone or mail once we have reached a final decision. If we do need to speak with you, what time of day are more likely to reach you (document in ER)?

The process may take up to 45 days to review. During the evaluation period, you can help to expedite the process by:

returning phone calls from promptly

submitting requested documentation as quickly as possible

The FCL/Collections process continues until your application has been approved and you have met the required steps to begin your workout arrangement.

Please advise us immediately if there is a change in your situation or if your emergency contact telephone number changes.

Contact Early Loss Mitigation at 1-800-446-8939 after 14 days have passed if you would like to check on the status of your application. .

Thank you for calling Chase Home Finance.



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Practice Activity

In your groups, complete the following for each scenario:

1. Select the best solution for each scenario.

2. Determine who will be the customer, collector, and observer.

3. Each participant should practice having the discussion with the customer, using the key points below, as the observer uses the checklist on the following page to take notes.

Key Points

Advise the customer on the average timeframe from referral to decision.

Advise the customer to return calls promptly.

Advise the customer to submit requested documentation promptly.

Provide the customer with the HAD department phone number.



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Observer Checklist:

Did the Collections Counselor:

Advise the customer on the average timeframe from referral to decision

Advise the customer to return calls promptly

Advise the customer to submit requested documentation promptly

Provide the customer with the HAD department phone number

Notes:



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Scenario 1:

Enrique Menendez is 75dpd. He recently lost his job, but is working a part-time job while continuing his permanent job search. He wants to keep his home, but cannot make the current payments.

A. Is there anything Chase can do for him?

B. What information should you document in ER?

Scenario 2:

Helen Marshall has moved from New Jersey to Colorado. She put her house on the market 6 months ago and has finally received an offer. The offer is $10k short of her payoff amount. She can no longer afford to continue to make two house payments.

A. Is there anything Chase can do for her?


Scenario 3:

Bill Bostwick is 110dpd. He is receiving notifications that his house is moving through the foreclosure process. He wants to keep his house, but doesn’t know what do.

A. Is there anything Chase can do for him?


Chase Banking Mortgage Training Guide

Documents

Transcript of Chase Banking Mortgage Training Guide