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e U.S. Department
of Housing and Urban
Development's release of
Mortgagee Letter 2016-
02 this year marked an
important step in bridging
the gap between investor requirements and
mortgage field services best practices. It
provided one standard of property preservation
across the country, addressing issues like the
need for additional allowables, conveyance
timeframes and mold remediation, just to name
a few. HUD's Mortgagee Letter 2016-02 also
updated guidelines focusing on the importance
of the hazard insurance recovery process and the
role the hazard insurance recovery vendor plays
in this process. It requires mortgage servicers to
pursue insurance recovery and to make repairs
with hazard claim settlements. To comply, all
lenders and mortgage servicers need to ensure
they have a qualified mortgage field services
provider with a dedicated staff that handles the
hazard insurance recovery process to maximize
recovery and reduce losses.
e mortgage field services partner plays an
important role in the hazard recovery process.
ey are the eyes and ears of the mortgage
servicer and the hazard recovery vendor.
Additionally, damages are discovered when the
mortgage field services provider is completing
inspection and preservation services. is
discovery triggers the hazard insurance recovery
process.
IMPORTANCE OF IDENTIFYING AND
CATEGORIZING DAMAGE
When the initial inspection or preservation
services are completed and damages are
identified, it is important that these results
contain the necessary documentation so the
mortgage servicer, or its hazard recovery
vendor, can make a determination on whether
or not to file a hazard insurance claim. e
documentation should include the following
information:
I N D U S T R Y I N S I G H T / S T E V E M E Y E R
REAPING A RECOVERY
had
