Common use of Repurchase by lender Clause in Contracts

Repurchase by lender. A lender has the option to repurchase the unpaid guaranteed portion of the loan from a holder within 30 days of written ▇▇- ▇▇▇▇ by the holder when the borrower is in default not less than 60 days on principal or interest due on the loan; or when the lender has failed to remit to the holder its pro rata share of any payment made by the borrower within 30 days of the lender’s receipt thereof. The repurchase by the lender must be for an amount equal to the unpaid guaranteed portion of principal and ac- crued interest less the lender’s serv- icing fee. The holder must concur- rently send a copy of the demand letter to the Agency. The lender must accept an assignment without recourse from the holder upon repurchase. For those loans closed on or after August 2, 2016, the lender or the Agency will issue an interest termination letter to the hold- er(s) establishing the termination date for interest accrual if the default is not cured. The guarantee will not cover in- terest to any holder accruing after the greater of: 90 days from the date of the most recent delinquency effective date as reported by the lender or 30 days from the date of the interest termi- nation letter. If, in the opinion of the lender, repurchase of the guaranteed portion of the loan is necessary to ade- quately service the loan, the holder must sell the guaranteed portion of the loan to the lender for an amount equal to the unpaid principal and interest on such portion less the lender’s servicing fee. The lender must not repurchase from the holder for arbitrage or other purposes to further its own financial gain. Any repurchase must only be made after the lender obtains the Agency’s written approval. If the lend- er does not repurchase the guaranteed portion from the holder, the Agency may, at its option, purchase such guar- anteed portion for servicing purposes. The lender is encouraged to repurchase the loan to facilitate the accounting of funds, resolve any loan problems, and

Repurchase by lender. A lender has the option to repurchase the unpaid guaranteed portion of the loan from a holder within 30 days of written ▇▇- ▇▇▇▇ by the holder when the borrower is in default not less than 60 days on principal or interest due on the loan; or when the lender has failed to remit to the holder its pro rata share of any payment made by the borrower within 30 days of the lender’s receipt thereof. The repurchase by the lender must be for an amount equal to the unpaid guaranteed portion of principal and ac- crued interest less the lender’s serv- icing fee. The holder must concur- rently send a copy of the demand letter to the Agency. The lender must accept an assignment without recourse from the holder upon repurchase. For those loans closed on or after August 2, 2016, the lender or the Agency will issue an interest termination letter to the hold- er(s) establishing the termination date for interest accrual if the default is not cured. The guarantee will not cover in- terest to any holder accruing after the greater of: 90 days from the date of the most recent delinquency effective date as reported by the lender or 30 days from the date of the interest termi- nation letter. If, in the opinion of the lender, repurchase of the guaranteed portion of the loan is necessary to ade- quately service the loan, the holder must sell the guaranteed portion of the loan to the lender for an amount equal to the unpaid principal and interest on such portion less the lender’s servicing fee. The lender must not repurchase from the holder for arbitrage or other purposes to further its own financial gain. Any repurchase must only be made after the lender obtains the Agency’s written approval. If the lend- er does not repurchase the guaranteed portion from the holder, the Agency may, at its option, purchase such guar- anteed portion for servicing purposes. The lender is encouraged to repurchase the loan to facilitate the accounting of funds, resolve any loan problems, andand prevent default, where and when rea- sonable. The benefit to the lender is that it may resell the guaranteed por- tion of the loan in order to continue collection of its servicing fee if the de- fault is cured. When the lender repur- chases the guaranteed portion from the secondary market for servicing pur- poses, the lender must discontinue in- terest accrual if Federal or State regu- lators place the loan in non-accrual status if the default is not cured within 90 days. The lender will notify the holder and the Agency of its decision.