CRF Loan Servicing, LLC
Loan Servicing
The Private Money Loan Servicing industry evolved almost by accident. Brokers would fund a Hard Money loan themselves, or individuals would lend Hard Money to friends or family. Unfortunately, they were burdened with tracking payments, interest, late pays, handling foreclosures, etc. Private Money lenders simply didn't have the time, expertise, systems and tools to handle Loan Servicing or Foreclosures, nor do they want the expense or liability that comes with in house processing. The best way to continue lending was to outsource the Loan Servicing. When a number of these Hard Money lenders asked for help doing Loan Servicing and Foreclosures on their Private Money Loans we designed two programs.
CRF offers two Loan Servicing platforms designed to fulfill the varied needs of our clients.
Standard Loan Servicing
Standard Loan Servicing is a high quality, structured program for servicing all types of performing and newly originated Private Money loans at very competitive prices.
Standard Loan Servicing
CRF offers a comprehensive high quality Loan Servicing solution with excellent pricing. We service individual loans and loan pools of any size for Brokers, Lenders, Institutions, and Private Investors. Most services are available nationally. Loan Servicing Programs Primary Servicing (CRF is the Servicer) Sub Servicing (Broker earns a Servicing fee) Private Label Servicing (minimum 5,000 active loans) Interim Servicing
Loan Type Serviced Residential Loans Consumer Real Estate Commercial Real Estate Manufactured Housing Land Construstion Prime Sub-prime Fixed ARM HELOC
Loan Status Definitions Newly Originated Loan: A Loan of any type that has just been made and just closed. The originating Broker/Company may have funded the Investor in at the closing, or the Broker/Company may have funded the loan themselves and will assign (or sell) the note to an Investor later. The originating Broker/Company may have a Note Rate and a Sold Rate. For example the note was originated at a Note Rate of 12% and is being sold to the Investor at a Sold Rate of 11% with the Broker/Company keeping 1% as additional monthly compensation (also known as a "Spread"). The Broker/Company will typically continue to monitor the loan through the servicer, and provide guidance to the investor. Performing Loan: Any loan that is current, one or two months delinquent, according to its original or modified terms. Non Performing Loan: Any loan that is three months or more delinquent. The known situation for each loan should be disclosed. Loan Pools: A group of loans that may be Performing, Non Performing or mixed. The situation for each loan in the pool should be disclosed. Standard Loan Servicing Program for Brokers and Institutions This program is for Newly Originated Loans, Performing Loans and Performing Loan Pools. It consists of Payment Processing, Basic Collection, and Default Servicing. There is a one time Loan Setup and File Scrubbing Fee (submitted data reconciled to the document data) of $65 per Standard loan, $200 per performing Bankruptcy or Forbearance Plan loan. Call for reduced fees on bulk transfers. Loans in Bankruptcy are serviced and charged as two loans: a pre petition loan and a post petition loan. Data entry fee to reset any Loan terms, including Disbursements and Assignments of new Lenders, after a Loan is set up is $65 per instance. Transfer of servicing from CRF to another entity (excluding payoffs) is $45 per loan. Sub Servicing The originating Broker/Company may be selling the interest in a Note to an Investor/Lender, servicing retained (not released), with a Note Rate and a Sold Rate. For example the note was originated at a Note Rate of 12% and is being sold to the Investor/Lender at a Sold Rate of 11% with the Broker/Company keeping 1% as additional monthly compensation (also known as a "Spread"). The Broker/Company should continue to monitor the loan through the sub servicer, and provide guidance to the investor. In this scenario CRF is acting as the sub servicer for the originating Broker/Company. Typically, the borrower payments will be disbursed to the Investor minus the Spread, and the Spread will be disbursed to the Broker/Company minus the CRF loan servicing fee. Payment Processing
Payment Processing is set up as soon as a complete Loan Servicing Setup Package is received. The fee is $20 per month per Investor/Lender. Add $10 for HELOC and/or Variable loans. Add $20 for Forbearance Plan loans. Loans over $600,000 are 0.080% of the unpaid principal balance divided by 12 ($1M loan equals $80.00 per month), or $35 per month per Investor/Lender, whichever is greater. The Payment Processing portion of the program includes: Borrower Welcome Letter Borrower Monthly Statement with Payment Coupon and Return Envelope Lender Welcome Letter Lender Monthly Statement of all Accounts Same Day Payment Posting Daily Disbursement of Funds (after clearing) Electronic deposit of Funds (ACH) into Lender's account Optional Escrow/Impounds Service for Insurance and Taxes Payoff Demands Rush Demands Disbursements and Draws Releases & Reconveyances IRS 1098 and 1099-INT Reporting 24/7 On Line Secure Account Access for Brokers and Investor/Lenders Downloadable Reports for Brokers and Investor/Lenders
Optional Escrow/Impounds Service: When the borrower's monthly payment on a first position loan includes amounts for the payment of Property Taxes and/or Hazard Insurance, CRF will collect and hold those proceeds in a trust account and disburse the scheduled payments to the respective authority as scheduled. The fee is $35 per month per loan and will be added to the monthly loan servicing fee and prorated to the respective Lenders. Recommendation Note: On loans that do not use the optional Escrow/Impound service, it is recommended that the Broker or Investor/Lender file a Loss Payee Notice with the insurance company, check for payment of taxes once a year or use a Tax Service, and (if applicable) file a Request for Notice of foreclosure with any senior lien holder. Collection Collection starts when the Borrower Payment is 15 days past due. The fee is 75% of paid Late Charges. The Basic Collection portion of the program includes: Late Notice sent at 15 days delinquent Final Notice sent at 31 days delinquent Borrower inquiry calls handled Act as intermediary between Borrower and Broker or Investor/Lender Notify Broker or Investor/Lender of Borrower need for refinance or modification
Collection Option: Troubled loans in Standard Loan Servicing can be transferred to Specialty Loan Servicing for high touch servicing, collection and possible modification. Default Servicing CRF handles the Default Servicing on all loans serviced. Foreclosure processing is an integral and required part of Standard Loan Servicing. Fees will vary widely by state. The Default Servicing portion of the program includes: Specific 30 day Notice of Intent letters available Foreclosure process started immediately upon written request by Broker or Investor/Lender National Foreclosure processing or coordination CA Declaration of Compliance Legal Services coordination including Bankruptcy Relief and Eviction REO management and property sale available
Specialty Loan Servicing
The Specialty Loan Servicing department is specifically designed to rapidly turn delinquent Loans and Loan Pools into cash by restructuring loans, or by foreclosing and selling the properties. It is staffed by experts in skip trace, hard collection, loan workout, loan modification, foreclosure, and property sale.
Specialty Loan Servicing
The Specialty Loan Servicing department is staffed by highly experienced skip trace, collection, workout, repossession, and property sale specialists. This department has High Touch Loan Servicing specifically designed to optimize the returns on Delinquent Loan Pools and Troubled Loan Portfolios. The Specialty Loan Servicing program can be used for Performing Loans, Non Performing Loans and Loan Pools. Delinquent Loan Pools: There are three stages to the purchase and working out of delinquent or mixed performing and non performing loan pools. These are Pre Purchase Evaluation, Due Diligence, and Collection/Servicing. Troubled Loan Portfolios: These are existing portfolios typically made up of higher risk performing, sub performing and non performing loans. These loans go straight to Collection/Servicing with a strategy to get each loan on track, or get the collateral back as quickly as possible.
Loan Types Serviced Residential Loans Consumer Real Estate Commercial Real Estate Manufactured Housing Land Construction Prime Sub-Prime Fixed ARM HELOC MERS registered
Loan Status Definitions Newly Originated Loan: A Loan of any type that has just been made and just closed. The originating Broker/Company may have funded the Investor in at the closing, or the Broker/Company may have funded the loan themselves and will assign (or sell) the note to an Investor later. The originating Broker/Company may have a Note Rate and a Sold Rate. For example the note was originated at a Note Rate of 12% and is being sold to the Investor at a Sold Rate of 11% with the Broker/Company keeping 1% as additional monthly compensation (also known as a "Spread"). The Broker/Company will typically continue to monitor the loan through the servicer, and provide guidance to the investor. Performing Loan: Any loan that is current, one or two months delinquent, according to its original or modified terms. Non Performing Loan: Any loan that is three months or more delinquent. The known situation for each loan should be disclosed. Loan Pools: A group of loans that may be Performing, Non Performing or mixed. The situation for each loan in the pool should be disclosed. Pre Purchase Evaluation for Delinquent Loan Pools This involves running the Loan Pool Acquisition Formula from information provided by the seller. This complex model estimates return based on purchase price, or calculates purchase price based on desired return. The Loan Pool Acquisition Formula analyzes each loan through over 450 data variables, 20 calculation variables, and extrapolates 47 columns of data. The fee is $750 and includes 3 runs with variable information. Collection / Servicing for Troubled Loan Portfolios & Delinquent Loan Pools Collection / Servicing begins as soon as we receive copies of the seller's RESPA 'goodbye' letters listing CRF as the designated servicer. This quick start will also create lead time to find and submit claims under the short warranty period for those purchasing Delinquent Loan Pools. In Collection our initial focus is on locating, contacting and understanding the borrower's situation and developing workout and modification programs to keep payments coming in. Our secondary focus is on rapid, cost effective repossession and sale of the property generating a maximum net return. This program includes: Collection Features (default) Late Notices sent at 15 days delinquent Collection Letters Final Notice sent at 31 days delinquent Borrower Inquiry calls handled Skip Trace Collection calls Negotiations Property Valuation available Lien Verification available Letters of Understanding Loan Modifications Forbearance Agreements Short Pay negotiations Bankruptcy Relief Legal Issues coordination Foreclosure Processing Short Sale coordination Property Preservation and Securing Handle City Notices and Issues REO Property Management Evictions REO Property Sale
Loan Servicing Features (non default) Borrower Welcome Letters Borrower Monthly Statement with Payment Coupon Lender Welcome Letter Lender Monthly Statement of all Accounts Same Day Payment Posting Daily Disbursement of Funds (after clearing) Electronic deposit of Funds (ACH) into Lender's account Optional Escrow/Impounds Service for Insurance and Taxes Payoff Demands Subordination Agreements Assignments Disbursements and Draws Releases and Reconveyances IRS 1098 and 1099-INT Reporting Paper or EDI Communication 24/7 Account Access Downloadable Reports
Collection Fee Structure The standard fee for collecting and servicing delinquent SFR loans under the DELINQUENT LOAN PROGRAM is $125 per month per loan. Incoming performing loans, and loans brought current as a result of modification will go to the PERFORMING LOAN PROGRAM at $60 per month per loan for one lender plus $25 per month per additional lender, billed equally. Unusual loans and very large loans are negotiable. Collection fee on performing loans is 50% of paid late charges. There is a one time Loan Setup and File Scrubbing Fee (submitted data reconciled to the document data) of $65 per Standard loan, $80 per MERS loan, or $200 per performing Bankruptcy or Forbearance Plan loan. Call for reduces fees on bulk transfers. Loans in Bankruptcy are serviced and charged as two loans: a pre petition loan and a post petition loan. Data entry fee to reset any Loan terms, including Disbursements and Assignments of new Lenders, after a Loan is set up is $45 per instance. Transfer of servicing from CRF to another entity (excluding payoffs) is $25 per loan. Servicing fees and hard costs are paid by client as incurred (no markup on hard costs), or paid from a joint Reserve Checking Account funded by the client. Hard costs primarily include payment of taxes, liens, Attorney fees, Trustee fees, and Municipal charges. Optional Escrow/Impouds Service: When the borrower's monthly payment on a first position loan includes amounts for the payment of Property Taxes and/or Hazard Insurance, CRF will collect and hold those proceeds in a trust account and disburse the scheduled payments to the respective authority as scheduled. The fee is $35 per month per loan and will be added to the monthly loan servicing fee and prorated to the respective Lenders. Recommendation Note: On loans that do not use the optional Escrow/Impound service, it is recommended that the Broker or Investor/Lender file a Loss Payee Notice with the insurance company, check for payment of taxes once a year or use a Tax Service, and (if applicable) file a Request for Notice of foreclosure with any senior lien holder.
Fees Overview: | Loan Setup | Fee | | Standard Loan | $65 (One Time) | | MERS Loan | $80 (One Time) | | Performing, BK and Forbearance Plan Loan | $200 (One Time) | | Data Entry Loan Reset | $65 (Per Instance) | | Service | Monthly Fee
per loan | Monthly Fee for
multiple Lenders,
billed equally | | Collection for Delinquent loans | $125.00 | - | | Servicing for Performing loans | $30 min | $25 each | | Collection for Unusual and very large loans | Negotiation | Negotiation | | Optional Escrow/Impounds service on performing loans | $35.00 | - |
Geographic Area Standard Loan Servicing is available nationwide.
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