Common use of Non-Member Servicers Clause in Contracts

Non-Member Servicers. ‌ In addition to meeting all of the eligibility requirements for Servicers, Non-Member Servicers (NMS) must meet the following additional eligibility requirements in this section. Approval of NMS‌ To be a NMS and purchase Servicing Rights, an entity must: • Be approved as a servicer by at least one of the following agencies: Xxxxxx Xxx, Freddie Mac, or Xxxxxx Xxx. • Meet and maintain the following financial standards: o A minimum Lender Adjusted Net Worth/total assets ratio of six percent (6%) or equivalent AND a Lender Adjusted Net Worth of at least two-million five-hundred thousand dollars ($2,500,000) plus a dollar amount that represents one-quarter of one percent (0.25%) of the outstanding principal balance of its total portfolio of mortgage loans serviced OR as otherwise required by the MPF Provider; and o Liquidity equaling a dollar amount that represents three and a half basis points (0.035%) of the outstanding principal balance of its total portfolio of mortgage loans serviced plus an incremental two hundred (200) basis points if the outstanding balance of the non-performing mortgage loans in its total portfolio of serviced mortgage loans is in excess of six percent (6%) of the outstanding principal balance of its total portfolio of mortgage loans serviced OR as otherwise required by the MPF Provider. 21 MPF Announcement 2017-13 (3/28/17) MPF Announcement 2016-20 (12/5/16) A decline in a NMS’s Lender Adjusted Net Worth by more than twenty-five percent (25%) over a quarterly reporting period, or by more than forty percent (40%) over two-consecutive quarterly reporting periods, is a material and adverse change in the NMS’s financial condition and will constitute a breach of the Servicing Responsibilities, the Applicable Agreements, and the Guides. If a NMS records four (4) or more consecutive quarterly losses and experiences a decline in Lender Adjusted Net Worth of thirty percent (30%) or more during the same period, it will constitute a material and adverse change in the NMS’s financial condition and a breach of the Servicing Responsibilities, the Applicable Agreements, and the Guides. • Meet or exceed a Nationally Recognized Statistical Rating Organization’s (NRSRO) Servicing Proficiency Standards. To the extent required of a NMS by the FHFA, be accepted by an NRSRO as conforming to such NRSRO’s requirements for servicing proficiency. Maintaining Eligibility for NMS‌ NMS must file Quarterly Eligibility Certifications in lieu of the Annual Eligibility Certification. Commencing with the quarterly reporting period following the execution of the Applicable Agreement, the NMS must submit to the MPF Provider a complete and accurate Non-Member Servicer Quarterly Eligibility Certification, signed by a Principal Officer and certifying the NMS’s continuing compliance with all NMS eligibility requirements contained in the Applicable Agreement and the Guides. Upon written request by the MPF Provider or the Master Servicer, the NMS must provide the MPF Provider or the Master Servicer its financial information in a timely manner, including information verifying its compliance with the NMS eligibility criteria. If the financial information is not public information, the MPF Provider may provide the NMS’s financial information to other MPF Banks, investors or the MPF Provider’s regulator on a confidential basis. Annual SOC 1 Type 2 Audit Report‌ The NMS must submit to the MPF Provider, at its sole cost and expense, an unqualified annual service auditor’s report, commonly referred to as the Statement on Standards for Attestation Engagements, SSAE No. 16, Reporting on Controls at a Service Organization Type 2 Report (“SOC 1”), of the NMS, prepared by a certified public accountant, on or prior to December 1 of each year following the commencement of its Servicing activities under the Applicable Agreement. The NMS must reasonably cooperate with the auditors of the MPF Provider when preparing a SOC 1 report for the MPF Provider, including but not limited to, issuing the necessary and appropriate written management assertions. The NMS further agrees that in the event that the NMS delegates or contracts, with the required consents under the Guides and the Applicable Agreement, any of its Servicing Responsibilities which are described in Item 1122 of Regulation AB under the Securities Act of 1933, as amended, which includes without limitation any material Servicing Responsibilities outsourced to third parties (“Delegee”) pursuant to such Item 1122(d)(1)(ii) thereof, then upon the MPF Provider’s request such Delegee shall be required to provide an annual SOC 1, as provided in this chapter, or shall be required to reasonably cooperate with the auditors of the MPF Provider preparing a SOC 1 for the MPF Provider, in the same manner required by the NMS. The MPF Provider and each Owner Bank shall have the right to provide copies of each SOC 1 they receive pursuant to this chapter to other MPF Banks or the MPF Provider’s regulator and auditors on a confidential basis.