DeMarco said the initiative may consider a fee for servicingrncompensation structure for non-performing loans as well as the possibility ofrnreducing or eliminating the minimum mortgage servicing fee for performingrnloans.  FHFA expects to coordinaternefforts of the joint initiative over the next few months to gather feedbackrnfrom the industry, consumer groups and regulators.  Any implementation of a new structure wouldrnnot be expected to occur before the summer of 2012.  </p

With respect to more near-term issues, DeMarco said that FHFArnand the GSEs have established a working group to align the GSEs’ currentrnservicing standards and establish appropriate incentives to encourage contactrnwith borrowers early in any delinquency, Each of the Enterprises has its own servicing guide and procedures, arngreater consistency will build on the best practices of each and ease thernburden on servicers.  The working grouprnwill develop consistent timelines and requirements for contacts with borrowersrnso there is no confusion about what is expected by the Enterprises fromrnservicers. This includes consideration of appropriate penalties to encourage efficient resolution and liquidation of properties in cases where foreclosure is necessary. The Enterprises will be moving forward with servicer penalties for last year in the coming weeks, but will announce arn new set of requirements, timelines, incentives, and penalties by the end of the first quarter of this year.</p

DeMarco said that FHFA is closely involved with otherrnregulators in developing national servicing standards.  This heightened coordination between primaryrnand secondary market supervisors should help market participants operate withrnmore uniform regulatory standards and expectations.

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