Default Management

MPF Default Management provides Participating Financial Institutions (PFIs) with delinquency oversight and assists in proper loan reporting and management of defaulted loans. In addition, we provide support regarding High Level Concern (HLC) mortgages and the Calculation of Realized Loss or Gain (Form SG332) under the MPF Traditional products. PFIs/Servicers are responsible to ensure that the servicing of each MPF Mortgage Loan adheres to the MPF Guides, Agreements and Applicable Laws. Please refer to the MPF Guides for complete details on all MPF Products.

eMAQCS®plus is a web-based, easy-to-use portal for the secure upload of reports and/or documents requested for various types of MPF Default Management reviews. eMAQCSplus also includes functionality for managing and reporting on your pipeline.

PFIs and Servicers are required to visit the eMAQCSplus webpage to obtain log-in credentials and sign up to receive email notifications. Users with existing eMAQCSplus Quality Control credentials will need to request additional access to Default Management.

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Default Reporting

All MPF Products

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High Level Concern (HLC) Mortgages

MPF Traditional - MPF Original, MPF 125 & MPF 35

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Calculation of Realized Loss or Gain (Form SG332)

MPF Traditional - MPF Original, MPF 125 & MPF 35

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COVID-19 Resources

The MPF Program is actively monitoring reports about the potential impact of COVID-19 (coronavirus) on borrowers, PFIs and Servicers. We have communicated various investor updates and temporary policies via MPF Announcements and e-alerts to ensure our PFIs and Servicers receive the most up to date information and enable you to better assist borrowers impacted by COVID-19.

MPF Traditional Product: COVID-19 Permanent Loan Modification Plan

Recorded On: March 22, 2022

What MPF Mortgage Loans are included in default reporting?

The Delinquent Mortgage & Bankruptcy Status Report (Exhibit B) must contain the status of all MPF Mortgage Loans:

Loans that remained unpaid as of the last day of the preceding month
- Note, if the payment is not made in the month in which it is due the loan is considered delinquent and should be included on the Exhibit B as if it was 30 days or more delinquent, even if this is less than 30 days
Loans, regardless of payment status:
- In which the borrower is in bankruptcy;
- In an active forbearance plan

How to report defaulted loans

PFIs/Servicers must report all defaulted loans on a monthly basis to the MPF Program via eMAQCSplus by submitting a Delinquent Mortgage & Bankruptcy Status Report (Exhibit B – Instructions and Template) file.

The Servicer must report the appropriate delinquency status codes and delinquency reason codes as listed in the Appendix to this Exhibit. To avoid the form being rejected, Servicers must follow the format requirements as provided for in the applicable MPF Servicing Guides.

If your Exhibit B file contains errors, you will be informed that the file submission failed along with a list of errors that need to be corrected.

When to report defaulted loans

MPF Traditional

By the 5th Business Day of the Month

MPF Xtra

By the 2nd Business Day of the Month

MPF Government MBS

By the 1st Business Day of the Month

What is a High Level Concern (HLC) mortgage?

MPF Traditional Conventional Mortgage Loans (MPF Original, MPF 125, MPF 35 only) are considered risk-shared Mortgage Loans. Part of sharing in the risk, at times, is sharing in the loss. On an ongoing basis, beginning at REO acquisition until REO disposition or Liquidation, as expenses grow or circumstances indicate a reduction in property value PFI/Servicers are required to conduct HLC determinations:

An Early Payment Default (EPD) Mortgage with an estimated Realized Loss, including accrued interest, of $5,000 or more; or
Any other delinquent Conventional Mortgage Loan with an estimated Realized Loss, including accrued interest, of the greater of $20,000 or 20% of the original property value.

When is a loan considered a High Level Concern (HLC) mortgage?

PFIs/Servicers are required to conduct HLC determinations on an ongoing basis beginning at REO acquisition until REO disposition or Liquidation, as expenses grow or circumstances indicate a reduction in property value.

The PFI/Servicer must submit the HLC Mortgage Loan File with a completed HLC Mortgage Notification (Form SG337) and/or field review appraisal via the eMAQCSplus website for an HLC review within sixty (60) days of determining that the loan is an HLC Mortgage, but no later than the date Form SG332 is submitted.

HLC Review Exceptions: Certain HLC Mortgages that are not EPDs are exempt from HLC review requirements. Familiarize yourself with the exception located in MPF Traditional Servicing Guide - Chapter 8.10.2.

A field review appraisal must be:

Written on one of the following forms, based on the property type:
- One-Unit Residential Appraisal Field Review Report (FNMA Form 2000 / FHLMC Form 1032); or
- Two-to-Four Unit Residential Appraisal Field Review Report (FNMA Form 2000A / FHLMC Form 1072).
Performed by a qualified, appropriately licensed or certified appraiser independent of the original appraiser or appraisal firm and unaffiliated with the Originator or Servicer.

Note: The MPF Bank reserves the right to conduct an early eligibility review of any Conventional Mortgage Loan on the first occurrence of the loan reaching 120 days delinquent. The PFI/Servicer will be notified in writing to submit specified HLC Mortgage Loan documents via eMAQCSplus.

When to utilize the Calculation of Realized Loss or Gain Form (SG332)

PFIs/Servicers of MPF Traditional loans (MPF Original, MPF 125, MPF 35 only) must use this form to calculate any Realized Loss/(Gain) after disposition of an REO property or Liquidation of a defaulted Conventional Mortgage Loan in accordance with MPF Traditional Servicing Guide - Chapter 11.

The Servicer must submit the completed form and supporting documentation within the following time frames:

Conventional Mortgage Loans without PMI or SMI: Within 90 days of the date the Guides require for Liquidation.
Conventional Mortgage Loans with PMI but without SMI: Within 90 days of the date of the PMI settlement.
Conventional Mortgage Loans with SMI: Within 90 days of the SMI settlement.

Additional claim items after the filing of the Form SG332 is submitted but must be provided via eMAQCSplus no later than 45 days after the initial claim is approved, using a supplemental Form SG332. This claim should not show a cumulative loss or gain only claimable items received after the initial form was submitted.

How to utilize the Calculation of Realized Loss or Gain Form (SG332)

After disposition of an REO property or Liquidation of a defaulted Conventional Mortgage under the MPF Traditional product (MPF Original, MPF 125, MPF 35 only), PFI/Servicer must use Form SG332 to calculate any Realized Loss or Gain. The Form SG332 is a job aid to assist you in completing the form and must be submitted via the eMAQCSplus website.

Submitting Form SG332

Follow these three steps when submitting Form SG332 via the eMAQCSplus website:

Step 1

Ensure you have all applicable Explanation of Benefits, from applicable PMI or SMI policies. Mortgage Insurance Proceeds must be reported on Form SG332.

Step 2

Electronically complete Form SG332 listing all allowable expenses and proceeds from the MI or SMI Explanation of Benefits.

Step 3

Submit Form SG332 along with any Explanation of Benefits, any claim forms, statements, vouchers, receipts, cancelled checks, and any other documentation to support all expense and credits to MPF Default Management for review via the eMAQCSplus website.

Default Reporting

Follow these steps for default reporting via the eMAQCSplus website:

Step 1

Ensure you have reviewed your MPF Mortgage Loan activity as of month-end and are reporting on all loans (regardless of MPF Product) that remain unpaid as of the last day of the preceding month and all loans, regardless of status, that are in active bankruptcies or forbearance.

Step 2

Review the Delinquent Mortgage & Bankruptcy Status Report (Exhibit B) file for format, description, and data guidance requirements. Action Codes and Data provided on Exhibit B help identify what actions have or have not occurred.

Step 3

Submit the Delinquent Mortgage Bankruptcy Status Report (Exhibit B) Template with all required loan and data field requirements to MPF Default Management via the eMAQCSplus website.

Step 4

If your Delinquent Mortgage Bankruptcy Status Report (Exhibit B) file contains errors, you will be informed that the file submission failed along with a list of errors that need to be corrected and the file resubmitted.