ProClose Platinum, our web-service closing software product, continues to improve the user's experience. Platinum works with any LOS that produces a MISMO XML. Recently, we made the following updates:

Dynamic Settlement Instructions
We streamlined our Settlement Instructions to print certain loan information dynamically based on the loan type and the fields on the "Additional Loan Data" screens. For example, ARM information and buydown information will appear on the Settlement Instructions only when they are applicable. The streamlined version of the Settlement Instructions also reduced the number of pages from five to four.

Post Closing Screen
A new menu option was added to the left-hand menu to allow the user to print the Post Closing Package. The screen changes dynamically, depending on the type of insurance escrow collected on the loan, allowing you to enter the applicable information to complete the "Transfer of Insurance" Letter information. When the investor requires their own versions of the "Transfer of Insurance" letters, these versions automatically replace the ProClose generic forms in the Post Closing Package.

New and Improved Inter Vivos Trust Forms
We recently released our improved Inter Vivos Trust forms. The new versions allow each loan to have two Trusts; each Trust allows two Trustees, two Grantors, multiple Beneficiaries and a Power of Attorney (POA), which prints for the Trustee and Grantors.

Additional Field Help
We are in the process of adding Help to certain Platinum fields. The Help appears as a question mark near the field. The information appears when the user "hovers" over the question mark or by clicking on the question mark, as is the case with the "Provider Information."

Reports
Generate your own custom Closing Reports with just a few clicks or use the Platinum default settings. Choose your date range, your sort options and your preferred report format, HTML or CSV, and you have reports suitable for upper management or day-to-day forecasting.

What the future holds for Platinum?

• Company default tab
• Dynamic signatures

When President Obama signed the American Recovery and Reinvestment Act into law on February 17, 2009, everyone waited in anticipation to see what congress had in store for our immediate and long-term future.  The anticipation gave way overnight to mixed feelings as to whether or not this newly decided path could produce the results necessary to turn our economy around.  More importantly, would this bill help stabilize the failing housing market and restore buyer confidence?  Critics from both sides of the aisle immediately went to work dissecting this massive piece of legislation in the hopes of better understanding its implications.  While not everything is apparent from the start, enough details are known where we can begin to sort through the plan, identify what it aims to accomplish, whom it will and will not help, and how.  However, some of the most important factors that may directly impact how successful this legislation ultimately becomes will only be revealed in the future.  The policies of this new administration will undoubtedly play a meaningful role in how things play out.  Let's take a look at what we know.

One important aspect to keep in mind is the bill was not crafted to ensure everyone remain homeowners.  Economists agree there are just some people who should be career renters instead of homeowners.  Similarly, there are those who probably will end up successful homeowners down the road but happened to get into a home when they were either not financially ready or at the wrong possible time, i.e., just prior to losing their job.  Unfortunately, some of those who should be renters either found a way to game the system, qualified for loans due to forced banking policies, were victims of predatory lending practices, or just happened to be at a financial peak in their lifetime they would not be able to maintain indefinitely.  Some foreclosures will continue to take place as these mortgage holders are culled from the system.  An unfortunate side effect of growing foreclosures is a continued increase in the overall supply of available houses.  Other mortgage holders who will find themselves ineligible for government assistance are those who are currently "underwater," or owe more than 105% of the current market value of their home.  This particular segment may rise for some time as property values continue to fall while more and more people find themselves unemployed.  Those who purchased jumbo loans, or, loans valued over $417,000, will also be left out of the assistance package.  So will anyone stuck with an additional mortgage resulting from trying to flip a house unless the issuer of the second mortgage agrees to keep it in the second position, and, the borrower proves they will still be able to afford the newly refinanced first loan.  Also, while attempting to restructure existing loans, if it is determined the only way for a homeowner to afford the mortgage is by reducing the interest rate to 2% or lower, those homeowners will be deemed ineligible for assistance.  So if not everyone will benefit, then who will, and how?

Let's go back to those not eligible for loan restructuring or who face imminent foreclosure for just a minute.  These people will not necessarily be cast out, homeless, to go back to renting apartments or living in public housing.  There is talk of a provision that would allow them to remain in the home they currently occupy, only now as a renter.  While ownership of the home would revert back to the loan issuer, some banks could be willing to allow people to remain as renters paying a smaller, more affordable amount.  Three positive outcomes here: one is the family is not displaced, another is one less home on the market for sale, and finally, the bank will still realize some income from the property even though they did not intend to get into the home ownership and rental business.  Lenders and financial institutions are also going to be encouraged to restructure loans through cash incentives.  Here is where we get into the meat of the plan.

To make mortgages more affordable for borrowers facing financial hardship, financial institutions should aim to reduce monthly payments to no more than 38% of the borrowers' monthly income.  If this can be achieved, the government will then match any additional reductions dollar for dollar with the aim of dropping the payments to as little as 31% of a borrowers monthly income.  In an effort to be proactive, for every loan the mortgage servicers and holders can successfully restructure before a borrower misses a payment, the loan servicers will receive $500 while the mortgage holders will receive up to $1500 in incentives.  Once a loan has been restructured, providing the borrower manages to stay current the entire time, mortgage holders will also get an additional incentive of $1000 annually for the next three years.  Borrowers are also eligible for monthly rewards, up to $1000 annually, for the next 5 years if they stay current on all mortgage payments.  Unfortunately, only mortgages financed through Fannie Mae or Freddie Mac are eligible for government assistance under this program.  For those who were not financed through either of the two government backed institutions, the government has threatened to modify bankruptcy codes in an effort to get those lenders to make voluntary changes.  With modified bankruptcy codes, judges would then have the flexibility to write down mortgages, ultimately costing lenders more.  There is also a $10 billion insurance fund that will be established by the Treasury Department.  The aim here is to encourage lenders to refinance loans now by partially offsetting future losses lenders would expose themselves to if housing prices continue to drop and the borrower ultimately defaults.  One of the last elements of the plan is to entice first - time buyers into the housing market.  In order to facilitate new home buying, the bill calls for an $8000 tax credit the borrower will not have to repay so long as they purchase a new home in the 2009 calendar year by December 1st.

While these initiatives will undoubtedly help some people, many more will get little or no relief at all.  Even the tax incentive for first - time buyers is seen as divisive by some.  Why should someone who buys a home in 2009 get an $8000 credit that does not have to be repaid when those who purchased in 2008 got a $7500 credit that does have to be repaid?  It can be argued that anyone who purchases a home in 2009 is much more aware of the current market situation and is probably more financially stable if they're in the market for a home now.  If they aren't, they shouldn't be house hunting!  Surely the plan could have grandfathered in 2008 buyers?  Obviously, the idea is to get people to buy houses now; however, 2008 home buyers have to feel like those who bought the iPhone 3G's the day before Apple announced its $100 price cuts!  Even with the tax credit, it remains to be seen whether potential buyers will remain on the sidelines and watch home values continue to drop while waiting for prices to stabilize, or will the credit be the incentive they need to make a purchase?  Economists believe values may continue the downward trend for another 10 - 15%.  Much of this could depend on the area of the country in question.  While certain areas of the country have been little affected, others have been devastated.  This brings up another good question: what criteria will bankruptcy judges use when deciding how to value mortgages when ordering adjustments?  Will the criteria vary by region or will there be a universal template?  Will the template change for adjustments made in Phoenix during the month of June versus adjustments made 6 months later in December when values may have dropped even further?  Further unknowns include the affect President Barack Obama's upcoming speech Tuesday evening on the economic crisis will have on the financial market.  He is expected to announce tax increases on the richest American's.  Tax increases, regardless of who they are aimed at, will probably not sit well on a Wall Street in the middle of a worldwide recession.  If the global slump continues, how many more will lose jobs and face foreclosures in the future?  Even those helped by the previously outlined refinancing measures may eventually wind up in default as newly restructured loans would revert back to current market levels when they expire after 5-years time.

No matter what preconceived notions anyone may have, the way forward has been laid out.  It is in everyone's best interest to see this bill succeed, and succeed mightily.  The next major date is March 4th, when the final plan and a detailed description of its workings are scheduled to be unveiled by Treasury Secretary Tim Geithner.  Much has been entrusted to our new President and the staff he has assembled.  Through no fault of his own, he has not been dealt a good hand to start things off.  How he guides us through these tough times will say much about who he is and serve as a testament to his character and leadership.  Let's hope he indeed has the ability to bring about the change we need so badly.

Steve Jankiewicz is a graduate of Auburn University.  He is a concerned homeowner in Alabama.

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Appraisal clarifications and raised Credit Score requirements were the big trend for Investors over the last 2 months. Clarifications and updates were made on everything from appraisal signature requirements, to new approved and ineligible appraiser lists. Greater guidelines, even complete restrictions, are being made on TPO (Third Party Originated) loans.

BB&T
Effective January 27, 2009, BB&T announced a new vendor for ordering tax transcripts via the IRS Form 4506-T. MBS-ProClose updated its BB&T version of this form with the new information (printing in line 5) and provided this to all MBS clients. BB&T also raised their minimum credit score requirements on all FHA loans from 580 to 620 (effective February 2, 2009).

Flagstar Bank
Flagstar Bank now requires a Social Security Authorization Form in the closing package of all government loans. While this is not a requirement on conventional loans, Flagstar Bank does recommend it. MBS-ProClose is creating the form as ProClose ID AAFLC1. It is currently being added to all Flagstar formsets.

On February 9, 2009, Flagstar Bank announced their Fannie Mae HomePath Program. Geared toward borrowers purchasing REO property from FNMA, it includes fixed, adjustable, Flex, High Balance and Expanded Approval options.

Franklin American Mortgage Company
FAMC has suspended their non-conforming 15-year fixed rate term and their non-conforming 7/1 ARM. The minimum credit score has been raised to 720 on all non-conforming loans. These new changes are effective on loans locked as of February 12, 2009.

GMAC Bank
Effective February 6, 2009, GMAC Bank discontinued their Freddie Mac Alternative Product (Codes 947 & 948). GMAC PITI Abatement feature has been discontinued from their conforming products (these loans must have been locked before February 13, 2009 and must be purchased by GMAC by March 1, 2009). Starting February 23, 2009 GMAC Bank's High Balance product codes are all new. Effective March 9, 2009 GMAC Bank will be enforcing stricter regulations on Third Party Originated (TPO) loans. Refer to bulletin CL09-039 for more details.

SunTrust Bank
Effective for loans locked on or after February 11, 2009, SunTrust raised their minimum credit score requirements to 640 for ALL loan products. Programs that previously required a higher than 640 credit score (such as 660 minimum for Agency Plus and 720 for Key Loan Program) remain at the higher score requirement.

Taylor, Bean & Whitaker
TB&W added/updated several forms over the last two months including: their MD Tangible Net Benefit form, MD Mortgage Loan disclosure, WA disclosures, and four North Dakota forms.

US Bank
On February 2, 2009, US Bank Home Mortgage began offering two Mortgage Insurance options: Upfront Single and Split Premium on their high LTV loans. US Bank discontinued all of their My Community Mortgage Programs. January 16, 2009 was the last day of purchase.

What does it mean when I cannot access ProClose Classic and get the following messages:

Error 14: License file is missing, user database cannot be found.  OR
Error 16: License file is corrupt.

Answer:
Go to My Computer and browse files to see if network drive containing ProClose (and/or other drives) is still connected. If not, it's likely that the user's mapping to the network has been lost. User will need to contact his or her tech support to be re-mapped, and this should resolve the problem.