Common use of Loss Mitigation Clause in Contracts

Loss Mitigation. These requirements are intended to apply to both government-sponsored and proprietary loss mitigation programs and shall apply to subservicers performing loss mitigation services on Servicer’s behalf. Loss mitigation application means an oral or written request for a loss mitigation option that is accompanied by any information required by the Servicer for evaluation for a loss mitigation option. Loss mitigation option means an alternative to foreclosure offered by the owner or assignee of a mortgage loan that is made available through the Servicer to the borrower. A. Loan Modification Requirements. 1. Servicer shall offer and facilitate loan modifications for borrowers rather than initiate foreclosure when such loan modifications for which they are eligible meet investor, guarantor, insurer, and program requirements. 2. Servicer shall, after receiving the final trial period payment, promptly send by written means a final modification agreement to borrowers who have enrolled in a trial period plan and who have made the required number of timely trial period payments, where the modification is underwritten prior to the trial period and has received any necessary investor, guarantor, or insurer approvals. The borrower shall then be converted by Servicer to a permanent modification upon execution of the final modification documents, consistent with applicable program guidelines, absent evidence of fraud. 3. Servicer shall ensure that a borrower’s permanent modification principal and interest payment is substantially the same as the borrower’s trial period principal and interest payment, except in limited instances in which the payment change is reasonable and warranted to permit the permanent modification to proceed.