The
National Servicing Center (NSC) in Tulsa monitors the servicing
of Good Neighbor Next Door (GNND) loans after closing. The Good
Neighbor Sales program allows eligible full-time law enforcement
officers, teachers, and firefighters/emergency responders to participate.
This page describes GNND participant responsibilities according
to program regulations.
If
you have any questions about your GNND mortgage, please contact
our servicing contractor according to these instructions.
Annual
Certifications
When
participants purchase properties under the GNND program they agree
to own and live in the property for a three-year period as their
sole residence. Participants are required to certify every year
that they are living in the property.
The annual certification is mailed to participants, ready for signature,
around the anniversary of the purchase. Participants should sign,
date, and return the form to the address specified in the letter.
If they fail to return the first letter, a follow-up letter is sent
one month later. At times, their return letter and our follow-up
letter cross in the mail. If this happens, participants can either
contact our servicer to determine if the first certification was
received and logged in or they can sign and return the second certification.
If
participants fail to return at least one annual certification per
year, NSC refers the case for investigation. An investigator will
then make an on-site visit to verify the occupancy of the property.
Further, the investigator will ask the participant to sign the annual
certification in their presence. In the event that investigation
fails to verify occupancy, the participant will be turned over to
the Office of Inspector General for further investigation and possible
prosecution. To avoid noncompliance, complete and return the annual
certification forms promptly and honestly. Falsifying information
on this certification is a felony. HUD will prosecute false claims
and statements. Conviction may result in criminal and/or civil penalties.
(18 USC 1001, 1010, 1012 3559, 3571; 31 USC 3729, 3802).
Military
Duty
Participants
who are called to active military duty are provided clemency in
regards to the owner occupancy requirements of the program for the
timeframe that they are on active duty. Participants on active military
duty are not required to occupy the property and are allowed to
rent the property (only while on active duty) if necessary to minimize
potential vandalism. However, the NSC needs to be aware of those
participants who are on active military duty and are not occupying
their property. Participants must notify the NSC according to the
Military
Duty Instructions. Print out the information and instructions
and comply with the instructions so that you will not be referred
for investigation during your military duty.
Subordinations
When
participants close on their home, they sign a note and a mortgage.
The mortgage is filed right after the first (primary) mortgage,
making it a second mortgage. When participants pay off their first
mortgage (usually done by refinancing), HUD's mortgage moves into
first position. If a participant is attempting to refinance their
first mortgage, the lender will want its new loan to be in first
position. In order to accomplish this, HUD must be willing to subordinate
its position to the new first mortgage.
HUD
has certain rules and procedures regarding subordinating. The rules
are that HUD will consent to refinancing (1) for the purpose of
obtaining an FHA 203(k) rehabilitation loan or (2) for the purpose
of obtaining a lower mortgage interest rate or change in the term
of the loan and (3) to prevent the participant from defaulting on
the first mortgage. The 203(k) loan is a rehabilitation loan in
which necessary property improvements are financed into a new loan.
The
closing (or title) agent handling the closing of the new loan should
handle the paperwork and details to obtain the HUD subordination.
Participants can refer the closing company to this page or they
can print the Subordination
Information sheet and take it to the closing company. Read the
linked information then mail or fax the subordination request to
our servicing contractor, C&L Service Corp./Morris-Griffin Corp.,
according those instructions.
Pay
Offs
If
a participant needs to dispose of the property before expiration
of the three-year occupancy period (for job relocation, family composition
changes, or refinance), NSC's contractor, C&L Service Corp./Morris-Griffin
Corp., processes those payoffs. Fax the request for the payoff with
the following information: participant's name, full property address,
estimated closing date, company requesting the payoff, company address,
company telephone number, return fax number, and signed permission
of the participant to collect the data. All of this information
may be mailed or faxed to C&L Service Corp./Morris-Griffin Corp.
Payoff requests are usually processed and faxed out within 2 business
days of receipt.
Releases
At
the end of the required three-year occupancy period, HUD's second
mortgage will be released provided (1) the participant has completed
and returned the required annual certifications, (2) is not currently
under investigation by the Office of Inspector General, and (3)
is in compliance with all GNND regulations. A mortgage satisfaction
will be filed with the participant's local county recorder's office.
After the release is filed, a copy will be mailed to the property
address. Thereafter, HUD's second mortgage will not show up on the
title to your property. After release, there is no further obligation
to or restrictions imposed by the Department of Housing and Urban
Development. Releases are mailed to the county recorder for filing
no later than thirty days after the end of the required occupancy
period. However, some counties have a filing backlog, over which
HUD has no control.
Releases
are prepared and filed by our servicing contractor, C&L Service
Corp./Morris-Griffin Corp.
Comments
and Questions
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