Loan Guaranty: Maximum Allowable Attorney Fees

Federal Register, Volume 82 Issue 24 (Tuesday, February 7, 2017)

Federal Register Volume 82, Number 24 (Tuesday, February 7, 2017)

Notices

Pages 9629-9631

From the Federal Register Online via the Government Publishing Office www.gpo.gov

FR Doc No: 2017-02474

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DEPARTMENT OF VETERANS AFFAIRS

Loan Guaranty: Maximum Allowable Attorney Fees

AGENCY: Department of Veterans Affairs (VA).

ACTION: Notice.

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SUMMARY: This notice provides updated information to participants in the Department of Veterans Affairs (VA) Home Loan Guaranty program concerning the maximum allowable bankruptcy attorney fees that are incurred by a servicer for legal services performed on their behalf. The notice also provides the allowable maximum attorney fees in calculating the indebtedness used to determine the guaranty claim payable upon loan termination. The table in this notice contains the amounts the Secretary has determined to be reasonable and customary for all States, following an annual review of amounts allowed by other government-related home loan programs.

DATES: The new maximum amounts for bankruptcy attorney fees will be allowed for each bankruptcy filed on or after March 9, 2017.

FOR FURTHER INFORMATION CONTACT: Mr. Andrew Trevayne, Assistant Director for Loan and Property Management (261), Loan Guaranty Service, Department of Veterans Affairs, Washington, DC 20420, (202) 632-8795 (Not a toll-free number).

Page 9630

SUPPLEMENTARY INFORMATION: The VA Home Loan Guaranty program authorized by title 38, United States Code (U.S.C.), Chapter 37, offers a partial guaranty against loss to lenders who make home loans to veterans. VA regulations concerning the payment of loan guaranty claims are set forth at 38 CFR 36.4300, et seq. Computation of guaranty claims is addressed in 38 CFR 36.4324, which states that one part of the indebtedness upon which the guaranty percentage is applied is the allowable expenses/advances as described in 38 CFR 36.4314. Paragraph (b)(5)(ii) of section 36.4314 describes the procedures to be followed in determining what constitutes the reasonable and customary fees for legal services in the termination of a loan.

The Secretary annually reviews allowances for legal fees in connection with the termination of single-family housing loans, including foreclosure, deed-in-lieu of foreclosure, and bankruptcy-

related services, issued by the Department of Housing and Urban Development (HUD), the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac). Based on increases in bankruptcy attorney fees announced over the past year by these entities, the Secretary has deemed it necessary to publish in the Federal Register a table setting forth the revised amounts the Secretary now determines to be reasonable and customary for bankruptcy attorney fees. The table reflects the primary method for foreclosing in each state, either judicial or non-judicial, with the exception of those states where either judicial or non-judicial is acceptable. The use of a method not authorized in the table will require prior approval from VA. This table will be available throughout the year at: http://www.benefits.va.gov/homeloans/.

There has been no change to the amounts VA will allow for attorney fees for foreclosure termination and for deeds-in-lieu of foreclosure. VA will continue to monitor these fees on an annual basis, as we are aware that other entities are conducting ongoing reviews of these fees.

The following table represents the Secretary's determination of the reasonable and customary cost of legal services for the preferred method of terminating VA loans in each jurisdiction under the provisions of 38 CFR 36.4314(b)(5)(ii).

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VA non-judicial VA judicial

Jurisdiction foreclosure 1 2 foreclosure 1 2 Deed-in-lieu of

foreclosure

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Alabama................................................ $1,325 N/A $350

Alaska................................................. 1,600 N/A 350

American Samoa......................................... 1,600 N/A 350

Arizona................................................ 1,350 N/A 350

Arkansas............................................... 1,400 N/A 350

California............................................. 1,350 N/A 350

Colorado............................................... 1,650 N/A 350

Connecticut............................................ N/A $2450 350

Delaware............................................... N/A 1,800 350

District of Columbia................................... 1,200 2,300 350

Florida................................................ N/A 2,800 350

Georgia................................................ 1,325 N/A 350

Guam................................................... 1,600 N/A 350

Hawaii................................................. N/A 2,950 350

Idaho.................................................. 1,150 N/A 350

Illinois............................................... N/A 2,300 350

Indiana................................................ N/A 2,050 350

Iowa................................................... 1,275 1,880 350

Kansas................................................. N/A 1,800 350

Kentucky............................................... N/A 2,250 350

Louisiana.............................................. N/A 1,900 350

Maine.................................................. N/A 2,300 350

Maryland............................................... 2,400 N/A 350

Massachusetts.......................................... N/A 2,550 350

Michigan............................................... 1,425 N/A 350

Minnesota.............................................. 1,450 N/A 350

Mississippi............................................ 1,200 N/A 350

Missouri............................................... 1,350 N/A 350

Montana................................................ 1,150 N/A 350

Nebraska............................................... 1,150 N/A 350

Nevada................................................. 1,525 N/A 350

New Hampshire.......................................... 1,350 N/A 350

New Jersey............................................. N/A 2,975 350

New Mexico............................................. N/A 2,000 350

New York--Western Counties \3\......................... N/A 2,675 350

New York--Eastern Counties............................. N/A 3,475 350

North Carolina......................................... 1,575 N/A 350

North Dakota........................................... N/A 1,750 350

Ohio................................................... N/A 2,250 350

Oklahoma............................................... N/A 2,000 350

Oregon................................................. 1,350 2,600 350

Pennsylvania........................................... N/A 2,350 350

Puerto Rico............................................ N/A 2,050 350

Rhode Island........................................... 1,725 N/A 350

South Carolina......................................... N/A 2,200 350

South Dakota........................................... N/A 1,800 350

Tennessee.............................................. 1,200 N/A 350

Texas.................................................. 1,325 N/A 350

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Utah................................................... 1,350 N/A 350

Vermont................................................ N/A 2,250 350

Virgin Islands......................................... N/A 1,800 350

Virginia............................................... 1,350 N/A 350

Washington............................................. 1,350 N/A 350

West Virginia.......................................... 1,150 N/A 350

Wisconsin.............................................. N/A 2,000 350

Wyoming................................................ 1,150 N/A 350

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\1\ When a foreclosure is stopped due to circumstances beyond the control of the holder or its attorney

(including, but not limited to bankruptcy, VA-requested delay, property damage, hazardous conditions,

condemnation, natural disaster, property seizure, or relief under the Servicemembers Civil Relief Act) and

then restarted, VA will allow a $350 restart fee in addition to the base foreclosure attorney fee. This fee

recognizes the additional work required to resume the foreclosure action, while also accounting for the

expectation that some work from the previous action may be utilized in starting the new action.

\2\ VA will allow attorney fees of $1050 (Chapter 7) or $1500 (initial Chapter 13) for obtaining bankruptcy

releases directly related to loan termination. For multiple bankruptcy filings under either chapter, VA will

allow an additional $500.

\3\ Western Counties of New York for VA are: Allegany, Cattaraugus, Chautauqua, Erie, Genesee, Livingston,

Monroe, Niagara, Ontario, Orleans, Steuben, Wayne, Wyoming, and Yates. The remaining counties are in Eastern

New York.

Signing Authority

The Secretary of Veterans Affairs, or designee, approved this document and authorized the undersigned to sign and submit the document to the Office of the Federal Register for publication electronically as an official document of the Department of Veterans Affairs. Gina S. Farrisee, Acting Chief of Staff, approved this document on January 27, 2017, for publication.

Approved: January 27, 2017.

Jeffrey Martin,

Office Program Manager, Office of Regulation Policy & Management, Office of the Secretary, Department of Veterans Affairs.

FR Doc. 2017-02474 Filed 2-6-17; 8:45 am

BILLING CODE 8320-01-P

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