Supporting Statement for Paperwork Reduction Act Submissions
OMB Control Number 2502-0041
(Forms)
Assignment of Mortgage (all states except Louisiana)
Assignment of Mortgagee (for Louisiana)
Affidavit Of Lost Note
Allonge To Note
Assignment Of Building Loan Agreement
Assignment Of Hazard Insurance Policy
Assignment Of [Security Agreement] [Chattel Mortgage]
Assignment Of Performance Bond-Dual Obligee
Indemnification Assignment Note
Indemnification Assignment - Deed of Trust or Mortgage Sample
Indemnification Assignment - Security Agreement Sample
Indemnification Assignment - UCCS
Indemnification Lost Note (added)
A. Justification
1. Explain the circumstances that make the collection of information necessary. Identify any legal or administrative requirements that necessitate the collection. Attach a copy of the appropriate section of each statute and regulation mandating or authorizing the collection of information. Include a statement regarding the changes for this submission. (Example: The changes for this submittal are as follows or the difference between this submission and the last is as follows....)
The regulations at 24 CFR 207.256, 207.256a, and 207.258 require a mortgagee to notify HUD when a mortgage payment is in default (more than 30 days past due), when a mortgagee has reinstated a loan, and to submit an election to assign a defaulted loan to HUD within a specified timeframe from the date of default. The regulation at 24 CFR 200.120 and 200.121, Subpart B, requires lenders to submit delinquency, default, election to assign, and other related loan information statuses electronically to HUD. Lenders previously used HUD Form 92426 for these submissions, however, with the implementation of the regulation requiring electronic notification, the Multifamily Delinquency and Default Reporting System (MDDR) was established to replace the paper form HUD-92426. Attached are copies of the regulations which govern the collection of this information.
The difference between this submission and the last submission is that the numbers for the respondents and responses more accurately reflect the actual numbers of approved mortgagees (respondents) for the multifamily insured loan portfolio that can potentially submit data to the MDDR system, and an average number of submissions made during the last three fiscal years (responses).
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2. Indicate how, by whom, and for what purpose the information is to be used. Except for a new collection, indicate the actual use the agency has made of the information received from the current collection.
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A mortgagee uses the MDDR system to submit a notice of fiscal delinquency when a mortgage payment is not made within 15 days from its due date (from the due date stated in the promissory note). If the non-payment continues for 30 days from its due date, the mortgagee is entitled to receive the insurance benefits and the mortgagee is required, within 30 days thereafter to submit a notice of default. During this time, if the mortgagor remits payment to fully cure the defaulted amount, the mortgagee will then submit a reinstatement of the loan, or if sufficient funds are remitted for one month’s payment, the mortgagee will submit a default update and roll the date of default forward by one month. If, however, the loan is not reinstated, in order to submit an application for insurance benefits, the mortgagee must elect to assign the defaulted loan to HUD by the 75th day from the date of default unless the mortgage is funded with the proceeds of bonds or is insured under Section 232 of the National Housing Act. If the mortgage is funded with the proceeds of bonds or is insured under Section 232 of the National Housing Act, the mortgagee must request a 90-day extension of the deadline for filing the notice of election to assign (see 24 CFR 207.258(a)(2)). A defaulted loan may not go more than the 75-day period, or 90-day period, as applicable, without an election to assign or an approved extension request. A mortgagee may also request an extension of the time to elect to assign a defaulted loan to HUD, providing supporting justification for the extension request, for the HUD field office to review and approve. A mortgagee uses the MDDR system to submit a notice of election to assign the defaulted loan to HUD. The assignment, when accepted, requires a package of documents to be prepared and submitted at or before closing the assignment (see 24 CFR 207.258(b)). MDDR includes a link to HUD Form 2510- The Legal Instructions Concerning Applications for Full Insurance Benefits-Assignment of Multifamily and Healthcare Mortgages to the Secretary (the “Legal Instructions”) (OMB Approval No. 2510-0006 (Exp. 10/31/2025)). The Legal Instructions specifies the legal documents that mortgagees must submit in connection with applications for insurance benefits. For the mortgagee’s convenience, MDDR includes samples for the following documents required under the approved Legal Instructions: Assignment of Mortgage (all states except Louisiana), Assignment of Mortgagee (for Louisiana), Affidavit of Lost Note, Allonge to Note, Assignment Of Building Loan Agreement, Assignment Of Hazard Insurance Policy, Assignment Of [Security Agreement] [Chattel Mortgage], Assignment Of Performance Bond-Dual Obligee, Indemnification Assignment Note, Indemnification Assignment - Deed of Trust or Mortgage, Indemnification Assignment - Security Agreement, Indemnification Assignment – UCCS, and Indemnification Lost Note. Mortgagee’s counsel may use these sample documents in preparing the legal documents. Mortgagees must also prepare three HUD forms: HUD-1044-D, HUD-2537, HUD-2747, which are administered under other OMB approvals. A mortgagor may also default under its business agreements with HUD, thus causing a covenant default, a violation of the Regulatory Agreement, and thus the mortgage, resulting in HUD requiring the mortgagee to accelerate the mortgage. This results in the mortgagee submitting a notice of covenant default to HUD and an ultimate election to assign the loan to HUD. An FHA-insured loan may go in and out of different statuses during its life cycle, prior to the mortgagee making an election to assign. For example, a mortgagee may report a loan delinquent in a month and reinstated prior to the end of that month. This pattern of delinquency could occur every month. HUD field and Headquarters staff use the data submitted in MDDR to monitor mortgagee compliance with HUD’s loan servicing procedures and requirements, to monitor delinquent and defaulted loans to work with the owner/mortgagee to potentially reinstate the loan and avoid an assignment and insurance claim. Assignments can be costly to the government. The MDDR system is the only mechanism for mortgagees to report this data to HUD, and ultimately file for an insurance claim if a loan goes to assignment.
Link to the MDDR System:
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3. Describe whether, and to what extent, the collection of information involves the use of automated, electronic, mechanical, or other technological collection techniques or other forms of information technology, e.g., permitting electronic submission of responses, and the basis for the decision for adopting this means of collection. Also describe any consideration of using information technology to reduce burden.
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This collection of information is remitted by mortgagees electronically through MDDR, a web-based application system. The system was developed to replace the paper form HUD-92426 in compliance with the regulation at 24 CFR 200 which requires the electronic submission of this information. |
4. Describe efforts to identify duplication. Show specifically why any similar information already available cannot be used or modified for use for the purposes described in Item 2 above.
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There is no duplication of this collection. MDDR is the only mechanism available for mortgagees to report this data to HUD. |
5. If the collection of information impacts small businesses or other small entities (Item 5 of OMB Form 83-I), describe any methods used to minimize burden.
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The impact on small businesses lending or servicing firms is necessary to collect and prepare delinquency and default data required for proper monitoring. The burden would be minimized when the continuous review of reports indicate that the project owner/agent has established financial stability, which time the requirement for periodic review is ended. |
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Estimates of the Hour burden of the Collection of Information |
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Information |
Number |
Frequency of |
Total |
Burden |
Annual Burden Hours |
Hourly Cost** |
Total |
Initial |
114 |
444 |
444 |
0.1666 |
74 |
$43.77 |
$3,237.76 |
30-day Extension |
114 |
978 |
978 |
0.1666 |
163 |
$43.77 |
$7,131.82 |
60-day Extension |
114 |
3 |
3 |
0.1666 |
0 |
$43.77 |
$21.88 |
90-day Extension |
114 |
18 |
18 |
0.1666 |
3 |
$43.77 |
$131.26 |
ETA (Election to assign) Acknowledged |
114 |
2 |
2 |
0.1666 |
0 |
$43.77 |
$14.58 |
ETA (Election to assign) Denied |
114 |
0 |
- |
0.1666 |
- |
$43.77 |
$- |
Total |
114 |
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1,001 |
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167 |
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$7,299.54 |
*There are currently 114 FHA-approved multifamily mortgagees that service active FHA-insured loans. A loan can go in and out of a status (delinquency or default) every month, depending on the mortgagor’s ability to make their payment timely. Unless a loan goes delinquent, in default, or an election to assign must be made no reports are required by a mortgagee. There are no restrictions or limits on how often this process can repeat.
**Bureau of Labor Statistics - total compensation when allowing for benefits
13. Provide an estimate for the total annual cost burden to respondents or recordkeepers resulting from the collection of information. (Do not include the cost of any hour burden shown in Items 12 and 14). The cost estimate should be split into two components: (a) a total capital and start-up cost component (annualized over its expected useful life) and (b) a total operation and maintenance and purchase of services component. The estimates should take into account costs associated with generating, maintaining, and disclosing or providing the information. Include descriptions of methods used to estimate major cost factors including system and technology acquisition, expected useful life of capital equipment, the discount rate(s), and the time period over which costs will be incurred. Capital and start-up costs include, among other items, preparations for collecting information such as purchasing computers and software; monitoring, sampling, drilling and testing equipment; and record storage facilities. If cost estimates are expected to vary widely, agencies should present ranges of cost burdens and explain the reasons for the variance. The cost of purchasing or contracting out information collections services should be a part of this cost burden estimate. In developing cost burden estimates, agencies may consult with a sample of respondents (fewer than 10), utilize the 60-day pre-OMB submission public comment process and use existing economic or regulatory impact analysis associated with the rulemaking containing the information collection, as appropriate. Generally, estimates should not include purchases of equipment or services, or portions thereof, made: (1) prior to October 1, 1995, (2) to achieve regulatory compliance with requirements not associated with the information collection, (3) for reasons other than to provide information or keep records for the government, or (4) as part of customary and usual business or private practices. There are no additional capital/start-up costs associated with this collection of information. |
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14. Provide estimates of annualized costs to the Federal government. Also, provide a description of the method used to estimate cost, which should include quantification of hours, operational expenses (such as equipment, overhead, printing, and support staff), and any other expense that would not have been incurred without this collection of information. Agencies may also aggregate cost estimates from Items 12, 13, and 14 in a single table. |
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*Estimated hourly cost is based on the annual salary of a GS-1101-12/Step 1 Account Executive
15. Explain the reasons for any program changes or adjustments reported in Items 13 or 14 of the OMB Form 83-I. |
This is a revision of a currently approved collection. There were no program changes, but for emphasis and clarity described to accurately reflect respondents and annual responses there was a slight decrease in burden. The number of respondents reflects the estimated number of FHA-approved multifamily servicing lenders that may submit information to the MDDR systems. The total annual responses are the average number of submissions made annually by these lenders. Most lenders service several FHA insured loans. The adjustment from the previous collection is reflective of a different number of loans being delinquent or in default. Early detection and monitoring of problems can lead to a lower number of defaults. |
17. If seeking approval to not display the expiration date for OMB approval of the information collection, explain the reasons that display would be inappropriate. |
The OMB expiration date will be displayed in the application instructions. |
18. Explain each exception to the certification statement identified in Item 19, "Certification for Paperwork Reduction Act Submissions," of OMB Form 83-I. |
There are no exceptions to the “Certification for Paperwork Reduction Act Submissions.” |
B. Collections of Information Employing Statistical Methods
There are no statistical methods used in this collection.
File Type | application/vnd.openxmlformats-officedocument.wordprocessingml.document |
Author | Herring, Vivian M |
File Modified | 0000-00-00 |
File Created | 2023-09-07 |