38 C.F.R. § 36.4317

Servicer reporting requirements

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(a) Servicers of loans guaranteed by the Secretary shall report the information required by this section to the Secretary electronically. The Secretary shall accept electronic submission from each entity servicing loans guaranteed under 38 U.S.C. chapter 37 not later than the effective date of this rule.

(b) Not later than the seventh calendar day of each month each servicer shall report to the Secretary basic information (loan identification information, payment due date, and unpaid principal balance) for every loan guaranteed by the Secretary currently being serviced by that entity, unless previously reported under paragraph (c)(7) of this section and has not reinstated, terminated, or paid in full.

(c) Servicers shall report to the Secretary the following specific loan events in accordance with the timeframes described for each event. Unless otherwise specified herein, the servicer shall report these events on a monthly basis (i.e., no later than the 7th calendar day of the month following the month in which the event occurred) only for delinquent loans in its portfolio.

(1) Loan paid in full—when the loan obligation has been fully satisfied by receipt of funds and not a servicing transfer. The servicer shall report this event regardless of delinquency status.

(2) Authorized transfer of ownership—when the servicer learns that an authorized transfer of ownership has been completed. The servicer shall report this event regardless of delinquency status.

(3) Release of liability—when an obligor has been released from liability. The servicer shall report this event regardless of delinquency status.

(4) Partial release of security—when the holder has released the lien on a part of the security for the loan pursuant to § 36.4327. The servicer shall report this event regardless of delinquency status.

(5) Servicing transfer (transferring servicer)—when a holder transfers the loan to another servicer.

(6) Servicing transfer (receiving servicer)—when a servicer boards the loan.

(7) Electronic Default Notification (EDN)—when the loan becomes at least 61 days delinquent. The servicer shall report this event no later than the 7th calendar day from when the event occurred. The servicer shall report this event only once per default for delinquent loans in its portfolio.

(8) Delinquency status—when the servicer notifies VA of any updates to the delinquency information on loans for which an EDN has been submitted. The servicer shall report this event monthly (i.e., no later than the 7th calendar day of the month following the month for which the reported information applies) until the default cures or the loan terminates.

(9) Contact information change—when there is a change to the contact information for current owners or a property or mailing address change.

(10) Occupancy status change—when there is a change in property occupancy status.

(11) Bankruptcy filed—when any owner files a petition under the Bankruptcy Code. The servicer shall report this event no later than the 7th calendar day from when the event occurred. The servicer shall report this event only on delinquent loans in its portfolio, if appropriate, or with the EDN when it is reported.

(12) Bankruptcy update—when a significant event related to the bankruptcy has occurred. The servicer shall report this event no later than the 7th calendar day from when the event occurred. The servicer shall report this event only on delinquent loans in its portfolio, if appropriate, or with the EDN when it is reported.

(13) Loss mitigation letter sent—when the servicer sends the loss mitigation letter to the borrower as required by § 36.4350(g)(1)(iv).

(14) Partial payment returned—when the servicer returns a partial payment to the borrower.

(15) Default cured/loan reinstated—when a previously reported default (i.e., an EDN was filed) has cured/loan reinstated.

(16) Default reported to credit bureau—when the servicer notifies the credit bureaus of a defaulted loan or loan termination. The servicer shall report this event only on delinquent loans in its portfolio, and shall report the first occurrence only.

(17) Repayment plan approved—when the servicer approves a repayment plan.

(18) Special forbearance approved—when the servicer approves a special forbearance.

(19) Loan modification approved—when the servicer approves a loan modification.

(20) Loan modification complete—when both the servicer (and/or the holder, where necessary) and the owner(s) have executed the modification agreement.

(21) Short sale complete—when a short sale closes.

(22) Deed-in-lieu of foreclosure complete—when the servicer records the deed-in-lieu of foreclosure. The servicer shall report this no later than the 7th calendar day from when the event occurred.

(23) Foreclosure referral—when the loan is referred to legal counsel for foreclosure. The servicer shall report this no later than the 7th calendar day from when the event occurred.

(24) Foreclosure sale scheduled—when the foreclosure sale is scheduled. The servicer shall report this no later than the 7th calendar day from when the event occurred.

(25) Results of sale—when the foreclosure sale is complete, the servicer reports the results of the foreclosure sale. The servicer shall report this no later than the 7th calendar day from when the event occurred.

(26) Transfer of custody—when the servicer notifies VA of the holder's intent to convey the property. The servicer shall report this no later than the 15th calendar day from the date of liquidation sale (such as the date of foreclosure sale, date of recordation of a deed-in-lieu of foreclosure, or confirmation/ratification of sale date when required under local practice).

(27) Improper transfer of custody—when the servicer discovers that the conveyance of the property to VA was improper. The servicer shall report this no later than the 7th calendar day from when the error is discovered.

(28) Invalid sale results—when the foreclosure sale is invalid. The servicer shall report this no later than the 7th calendar day from discovery of the event that invalidated the sale.

(29) Confirmed sale date with no transfer of custody—when the loan is terminated, the property is not conveyed, and the property is located in a confirmation/ratification of sale state.

(30) Basic claim information—when the servicer files a claim under guaranty. The servicer shall report this event within 365 calendar days of loan termination for non-VA purchase claims, and within 60 calendar days of the approval date for VA purchase claims.

(31) VA purchase settlement—when VA purchases a loan and the servicer reports the tax and insurance information. The servicer shall report this event within 60 calendar days of the VA purchase approval date.

(The Office of Management and Budget has approved the information collection requirements in this section under control number 2900-0021) (Authority: 38 U.S.C. 3703(c), 3732) [73 FR 6310, Feb. 1, 2008. Redesignated at 75 FR 33705, June 15, 2010, as amended at 75 FR 65238, Oct. 22, 2010; 89 FR 25144, Apr. 10, 2024]

Notes of Decisions

Cited in 19 cases, 1980–1998 · leading case: Buzinski v. Brown, 6 Vet. App. 360 (Vet. App. 1994).

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Buzinski v. Brown, 6 Vet. App. 360 (Vet. App. 1994). · cites it 8× “On February 20, 1986, the mortgagee filed with the VA a Notice of Intent to Foreclose as required by 38 C.F.R. § 36.4317 (1993). The notice is complete in all respects except that the box intended for the name and address of the original veteran borrower has been left blank.”

United States v. Whitney, 602 F. Supp. 722 (W.D.N.Y. 1985). · cites it 2× “§ 1816 (a); 38 C.F.R. § 36.4317 . If the lender repossesses any personal property, it must give notice of such repossession to the V.”

Vail v. Derwinski, 742 F. Supp. 1039 (D. Minnesota 1990). · cites it 2× “38 C.F.R. § 36.4317 . The V.A. then has fifteen days in which to notify the lender to proceed in “such manner as to effectively preserve the personal liability of the parties liable.”

United States v. Vallejo, 660 F. Supp. 535 (W.D. Wash. 1987). “38 C.F.R. § 36.4317 (1986). The Administrator then has 15 days in which to notify the holder to proceed in “such manner as to effectively preserve the personal liability of the parties liable____”38 C.”

Fitzgerald v. Cleland, 498 F. Supp. 341 (D. Me. 1980). “38 C.F.R. § 36.4317 . Upon receiving a notice of default from the Bank, the VA within 30 days may refund the loan, i.”

Rank v. Nimmo, 677 F.2d 692 (9th Cir. 1982). “38 C.F.R. 36.4317. Upon foreclosure, the lender, if he turns out to be the purchaser, generally may convey the property to the VA.”

Boley v. Principi, 144 F.R.D. 305 (E.D.N.C. 1992). “38 C.F.R. 36.4317. The VA must set a net value of the property, and if the proceeds of the foreclosure sale are less than the value set by the VA, the guaranty will not cover the difference.”

Boley v. Brown, 10 F.3d 218 (4th Cir. 1993). “38 C.F.R. § 36.4317 . The VA then has 15 days to instruct the lender on how to proceed.”

Vail v. Brown, 841 F. Supp. 909 (D. Minnesota 1994). · cites it 2× “§ 3732 (c)(3) (1991); 38 C.F.R. § 36.4317 *912 (1998). 5 The VA then has 15 days to instruct the lender how to proceed.”

Carter v. Derwinski, 758 F. Supp. 603 (D. Idaho 1991). · cites it 2× “38 C.F.R. § 36.4317 . The VA then has 15 days in which to give the lender instructions related to such proceedings.”

United States v. Davis, 756 F. Supp. 1162 (E.D. Wis. 1991). · cites it 2× “4323(a) states that the VA is subrogated to the rights of the holder of the mortgage note (usually the lender) and that the VA can obtain repayment of a deficiency from the veteran under a subrogation theory.”

Donovan v. West, 11 Vet. App. 481 (Vet. App. 1998). · cites it 2× “The only federal requirement as to the giving of notice to the veteran-borrower is regulatory, and it is placed on the holder and then only when the current owner of the property is not the original borrower ( 38 C.F.R. § 36.4317 (c) (1997)). See Buzinski supra.”

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— 38 C.F.R. § 36.4317(c) — 1 case

Buzinski v. Brown, 6 Vet. App. 360 (Vet. App. 1994). “On February 20, 1986, the mortgagee filed with the VA a Notice of Intent to Foreclose as required by 38 C.F.R. § 36.4317 (1993). The notice is complete in all respects except that the box intended for the name and address of the original veteran borrower has been left blank.”

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