02/01/2021: Retained Servicing Loans – Additional Information has been Added to the Year End Content

ServiceMac has added a new topic titled “Year End Parking Lot” in the Year End section of the Retained Servicing KnowledgeOwl.  

The updated content contained in this section is listed below.  Please view KnowledgeOwl for more details.

  • Examples of the FHA Prepayment Notice, PMI Notice, and Annual Accounting Notices have been uploaded

  • Loans in the following states receive an Annual Accounting Notice (loan history): CA / CO / HI / ID / MI / NY / OR / VT / WV

  • Loans in the following states earn interest on escrow and may receive an 1099-INT: CA / CT / ME / MA / NH / NY / OR / RI / UT / VT / WI

Customers wishing to pay 13 monthly payments in a single calendar year for purposes of claiming interest:

  • If customers wish to pay their payments ahead prior to 12/31, it will not cause issues on the year-end calculations
  • MSP automatically calculates which payments will reflect on the 1098 and which will not based on interest accrual and IRS guidelines
  • We report up to 13 months’ worth of interest as permissible under IRS guidelines
  • Example: Customer pays the January 2020 payment on January 5th, 2020, pays all payments in 2020 when due, and pays the January 2021 payment on December 5th, 2020.  In this example, 13 payments would be considered to determine interest paid.
  • IRS guidelines state that if 13 months of interest is claimed in one tax year, only 11 months of interest may be claimed in the following tax year regardless of the number of monthly payments made – customers should consult with their tax specialist for more information on this regulation

Do not transfer callers with questions about Interest on Escrow to CoreLogic

  • Talking Point: Interest is credited to the customer’s escrow accounts at the rate and frequency determined by their state legislature.  
  • Amounts deposited in escrow for Interest on Escrow reflect as a 160 transaction type in the loan history
  • View the IOE1 screen to review the interest calculation method – varies by state

Will the 1098 be mailed even if they have elected E-Billing?  

  • Yes, forms will be mailed as well as loaded to the online portal for customer access 

If customers are 30+ days delinquent, in forbearance, bankruptcy, etc, will this impact how they receive their Year End statements?

  • Year End statements are mailed regardless of loan status – customers may not be able to access the online portal due to the status of their loan

A spouse/POA/3rd party calls with concerns about the Year End Statement containing the name of a deceased borrower and they want it corrected?

  • All 1098 statements list the primary and co-borrower on the form, but only the social security number for the primary borrower will show on the form unless we were made aware of the scenario prior to 12/31/2020
  • POA/3rd party and non-borrower inquiries, we cannot display a non-borrower on the 1098 form

Will the 1098 indicate what the status is of the loan (forbearance, bankruptcy, loss mitigation, foreclosure)?

  • The 1098 itself will not reflect the account status

How will the February billing statement & Year End documents look in DMS?

  • The 1098s will be separate from the billing statements, located in the Year End cabinet towards the bottom of DMS.

If a 1098 is available in DMS, does that mean it will be viewable by the customer on the website? 

  • Yes, it is safe to assume that once the a document is viewable in DMS that it will be available on our website

How long after a loan is paid in full do customers have access to the website and mobile app?  

  • Loans that are paid in full will not have access to the Website / Mobile App

Corrected 1098 Statements:  In the event a corrected statement has to be generated, what timeframes should we provide?  

  • Correction files will be generated once a week beginning the week of January 11, 2021
  • Once the correction file is produced and sent to the Print Vendor, it will be mailed within 3 – 5 business days
  • A corrected statement will be viewable to the customer online and in DMS up to 5 business days after it is mailed to the customer
  • Corrections can take a total of 10-15 business days