Amendment No. 2 to the BankUnited Single Family Shared-Loss Agreement (as previously amended, the “SFLSA”) with the FDIC
Exhibit 2.1d
Amendment No. 2 to the BankUnited
Single Family Shared-Loss Agreement
(as previously amended, the “SFLSA”) with the FDIC
This Amendment No. 2 (the “Amendment”) is made and effective as of December 22, 2010 (the “Effective Date”), and amends the SFLSA between BankUnited and the FDIC as follows:
WHEREAS, on May 21, 2009 BankUnited entered into the SFLSA with the FDIC as Receiver of BankUnited, FSB, Coral Gables, Florida; and
WHEREAS, under the terms of the above referenced SFLSA the FDIC pays BankUnited a specified percent of the Loss Amount on Restructuring Losses; and
WHEREAS, the U.S. Department of the Treasury has developed a Principal Reduction Alternative for the Home Affordable Modification Program that provides for the forgiveness of principal over time pursuant to the Making Home Affordable Supplemental Directives 10-05 and 10-14 (as they may be further modified, supplemented or updated, the “PRA Directives”); and
WHEREAS, the FDIC and BankUnited wish to implement the principal reduction alternative provisions of the PRA Directives in the SFLSA.
NOW THEREFORE, in consideration of the mutual covenants and undertakings set forth herein, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree to amend the SFLSA as follows:
1. Amendments to Article 1- Definitions.
(a). The following definitions are hereby inserted in Article I of the SFLSA:
“Deferred Principal Reduction Amount” means the portion of the loan principal balance that is initially forborne and then forgiven by the Assuming Bank according to the PRA Directives.
“Deferred Principal Reduction Loss” means the losses incurred by the Assuming Bank upon forgiveness of a Deferred Principal Reduction Amount. A Deferred Principal Reduction Loss shall be calculated in accordance with the form and methodology set forth in Section 2.1(a)(1) and Exhibit A and reported as a Loss Amount for a Single Family Shared-Loss Loan on the Monthly Certificate for the Shared-Loss Month which includes the Principal Reduction Date for such Single Family Shared-Loss Loan (which Monthly Certificate shall be in the form of Exhibit B). For the avoidance of doubt, a Deferred Principal Reduction Loss shall include losses on retroactive PRA modifications in accordance with the PRA Directives.
“HAMP” means the United States Department of the Treasury’s Home Affordable Modification Program.
“PRA” means the Principal Reduction Alternative pursuant to the PRA Directives.
“PRA Directives” mean the Making Home Affordable Supplemental Directives 10-05 and 10-14, as they may be further modified, supplemented or updated.
“Principal Reduction Date” means the date the principal balance of a Single Family Shared-Loss Loan is reduced in accordance with and pursuant to the PRA Directives (e.g., the first, second and third anniversaries of the applicable trial period effective date and any date prior to the third anniversary if a Single Family Shared-Loss Loan is paid-in-full ).
“Qualifying Loan” means a Single Family Shared-Loss Loan that meets (a) the Qualifying Loan criteria in Exhibit 5 of the Single Family Shared-Loss Agreement or (b) the Eligibility Guidelines set forth in the Making Home Affordable Supplemental Directive 09-01 (or such other amended criteria as may be published from time to time by the U.S. Department of the Treasury), and in either case has a current loan-to-value (LTV) position greater than 115%, unless otherwise agreed pursuant to a written instrument signed by both parties to this Single Family Shared-Loss Agreement.
“Waterfall Calculation” means a series of steps taken by the Assuming Bank to reduce the borrower’s monthly housing debt to income ratio (“DTI ratio”).
(b). The following definitions are hereby amended and restated as follows:
“Loss” means a Foreclosure Loss, Restructuring Loss, Deferred Principal Reduction Loss, Short-Sale Loss, Portfolio Loss, Modification Default Loss or Deficient Valuation.
“Modification Default Loss” means the loss calculated in Exhibits 2b(3) or 2c(3) for single family loans previously modified pursuant to this Agreement, as adjusted for any realized Deferred Principal Reduction Loss, that subsequently default and result in a foreclosure, short sale or Deficient Valuation.
2. Amendments to Section 2.1.
(a). Section 2.1(a) is amended by adding the following at the end thereof:
(1) Principal Reduction Modification Analysis.
(i) Calculation of Monthly Amount. In applying the HAMP PRA Modification Guidelines, to calculate the monthly amount that will reduce the borrower’s DTI Ratio to 31%, the Qualifying Loan shall be run through two separate Waterfall Calculations and
NPV tests as specified in the PRA Directives. Both Waterfall Calculations shall be based on a target DTI ratio of 31% at the time of modification. If the estimated net present value of the foreclosed collateral upon disposition is less than either the estimated value of the Standard HAMP Modification or the PRA Modification, the Waterfall Calculation yielding the highest net present value will be used for modification. The Deferred Principal Reduction Amount shall not take the MTMLTV ratio below 115% without a written instrument signed by both parties to this Single Family Shared-Loss Agreement.
(ii) Procedure for Calculating and Claiming Deferred Principal Reduction Loss Amounts. The initial Restructuring Loss for a Qualifying Loan shall be determined using the methods specified in Exhibits 2a(1) and 2a(2) and Exhibit A of this Single Family Shared-Loss Agreement, with the Deferred Principal Reduction Amount initially treated as forbearance and deferred to the “Loan prepayment in full” date and the loan amortized according to the adjusted principal balance. At the first Principal Reduction Date, the Deferred Principal Reduction Loss shall equal the difference between the net present value calculated in determining the Restructuring Loss and the net present value calculated after giving effect to the principal reduction (using the same discount rate and “Loan prepayment in full” date specified in the Restructuring Loss calculation). On each subsequent annual Principal Reduction Date, the Deferred Principal Reduction Loss shall equal the difference between the net present value calculated for the previous Deferred Principal Reduction Loss and the net present value calculated after giving effect to the principal reduction (using the same discount rate and “Loan prepayment in full” date specified in the Restructuring Loss calculation).
(iii) Treatment of Incentive Payments. All PRA investor incentive payments described in the PRA Directives shall be treated as Recovery Amounts. For the avoidance of doubt, servicer and borrower incentives will not be treated as Recovery Amounts or otherwise applied to reduce the Deferred Principal Reduction Loss amount with respect to any Single Family Shared-Loss Loan unless borrower incentive payments serve to reduce the outstanding loan balance, it being understood and agreed that neither forbearance nor forgiveness of principal shall constitute borrower incentive payments.
3. Capitalized Terms. Capitalized terms used but not defined herein shall have the meanings ascribed thereto in the SFLSA.
4. No Further Amendment. Except as expressly amended hereby, the SFLSA is in all respects ratified and confirmed and all the terms, conditions, and provisions thereof shall remain in full force and effect. This Amendment is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the SFLSA or any of the documents referred to therein.
[Signature Page Follows]
IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the Effective Date.
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FEDERAL DEPOSIT INSURANCE CORPORATION, RECEIVER OF BANKUNITED, FSB, CORAL GABLES, FLORIDA | |
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By: |
/s/ Xxxxx Malami |
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Name: Xxxxx Malami |
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Title: Assistant Director |
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Attest: |
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FEDERAL DEPOSIT INSURANCE CORPORATION | |
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By: |
/s/ Xxxxx Malami |
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Name: Xxxxx Malami |
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Title: Assistant Director |
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Attest: |
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BANKUNITED | |
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By: |
/s/ Xxxxxxxx Xxxxx |
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Name: Xxxxxxxx Xxxxx |
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Title: COO |
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Attest: |
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[Signature Page to Amendment No. 2]
