18-15: POST PURCHASE CONDITIONS

First, we want to thank you for being a valuable partner with CBC Mortgage Agency in facilitating responsible homeownership throughout the country. We value our relationship highly and look forward to working with you in the months and years to come.

Those who have sold loans to CBCMA for a while have seen a big change in our loan purchase process. We no longer wait for our investor to review a loan prior to purchasing it. This has cut our purchase times dramatically.

Since a loan review is a human process, errors are inevitable. Our due diligence provider does a good job catching most loan deficiencies prior to loan purchase however sometimes deficiencies are missed prior to purchasing a loan but discovered in a post purchase loan review. These deficiencies result in post purchase conditions. Most of our partners are great partners and quickly provide these items to us however there are always those that necessitate a policy change. Some ignore post purchase requests until a fourth or fifth request is sent out and a threat of repurchase is made. These delayed conditions and lack of communication end up creating a large financial burden on us due to roll fees charged by our secondary market investors. We have enough correspondent partners delaying the submission of post purchase conditions that we feel compelled to implement the following policy beginning July 23rd:

When post purchase conditions are requested, correspondents will have 72 hours to provide the outstanding item(s) or to respond with a date when we may expect their submission. If we have not received the missing item(s) and have not received correspondence regarding the issue, a second notice will go out requesting a 48-hour response. If no response is received after 48 hours, the loan will be referred to our loan repurchase department and a repurchase notice will be sent out. Conditions that are not received within a total of five business days will start accruing roll fees at our standard rate (.025 per day) until the conditions are received and cleared. This policy will not affect most of our partners as they have proven very reliable however there are some that we hope will feel motivated to respond to post purchase requests in a timely fashion.

If you have questions or concerns regarding this policy, please email us at info@chenoafund.org.