[Federal Register Volume 78, Number 218 (Tuesday, November 12, 2013)]
[Notices]
[Pages 67465-67466]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-26985]


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DEPARTMENT OF VETERANS AFFAIRS


Loan Guaranty: Maximum Allowable Attorney Fees

AGENCY: Department of Veterans Affairs (VA).

ACTION: Notice.

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SUMMARY: This notice provides information to participants in the 
Department of Veterans Affairs (VA) Home Loan Guaranty program 
concerning the maximum attorney fees allowable in calculating the 
indebtedness used to determine the guaranty claim payable upon loan 
termination. The table in this notice contains the amounts the 
Secretary has determined to be reasonable and customary for all States, 
following an annual review of amounts allowed by other government-
related home loan programs.

DATES: The new maximum attorney fees will be allowed for all loan 
terminations completed on or after December 12, 2013.

FOR FURTHER INFORMATION CONTACT: Mr. Andrew Trevayne, Assistant 
Director for Loan and Property Management (261), Loan Guaranty Service, 
Department of Veterans Affairs, Washington, DC 20420, (202) 632-8795 
(Not a toll-free number).

SUPPLEMENTARY INFORMATION: The VA Home Loan Guaranty program authorized 
by Title 38, United States Code (U.S.C.), Chapter 37, offers a partial 
guaranty against loss to lenders who make home loans to Veterans. VA 
regulations concerning the payment of loan guaranty claims are set 
forth at 38 CFR 36.4300, et seq. Computation of guaranty claims is 
addressed in 38 CFR 36.4324, which states that one part of the 
indebtedness upon which the guaranty percentage is applied is the 
allowable expenses/advances as described in 38 CFR 36.4314. Paragraph 
(b)(5)(ii) of that section describes the procedures to be followed in 
determining what constitutes the reasonable and customary fees for 
legal services in the termination of a loan.
    The Secretary annually reviews allowances for legal fees in 
connection with the termination of single-family housing loans, 
including foreclosure, deed-in-lieu of foreclosure, and bankruptcy-
related services, issued by the Department of Housing and Urban 
Development (HUD), Fannie Mae, and Freddie Mac. Based on increases 
announced over the past year by these entities, the Secretary has 
deemed it necessary to publish in the Federal Register a table setting 
forth the revised amounts the Secretary now determines to be reasonable 
and customary. The table reflects the primary method for foreclosing in 
each State, either judicial or non-judicial, with the exception of 
those States where either judicial or non-judicial is acceptable. The 
use of a method not authorized in the table will require prior approval 
from VA. This table will be available throughout the year at: http://www.benefits.va.gov/homeloans/.
    The new VA table closely mirrors amounts and methods for 
foreclosure allowed by Fannie Mae. Unlike Fannie Mae, VA has determined 
that in Hawaii the preferred method of foreclosure should not yet be 
changed to include a second method. VA is aware that Hawaii has 
established a new non-judicial foreclosure procedure; however, VA 
believes this new method is not yet well-established enough to provide 
acceptable title to the real estate community. Thus, the judicial 
foreclosure procedure remains the preferred method. VA will continue to 
monitor the situation in Hawaii, and make necessary changes as 
conditions warrant.
    Other jurisdictions that require special mention include Oregon, 
South Dakota, and Nebraska. VA continues to prefer the non-judicial 
method in Oregon and sees no need to allow the judicial method on a 
regular basis. However, in South Dakota, VA determined that the non-
judicial procedure in South Dakota is not a preferred method of 
foreclosure. In the past, VA routinely allowed either the non-judicial 
or judicial method of foreclosure in Nebraska. At this time, VA is 
designating non-judicial as the preferred method of foreclosure in 
Nebraska, although special approval may be requested for a case where 
judicial foreclosure is deemed necessary.
    There is no change to the amounts VA will allow for attorney fees 
for deeds-in-lieu of foreclosure or for bankruptcy relief. VA will 
continue to monitor these fees on an annual basis, as we are aware that 
other entities are conducting ongoing reviews of these fees.
    The following table represents the Secretary's determination of the 
reasonable and customary cost of legal services for the preferred 
method of terminating VA loans in each jurisdiction under the 
provisions of 38 CFR 36.4314(b)(5)(ii). These amounts will be allowed 
for all loan terminations completed on or after December 12, 2013.

[[Page 67466]]



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                                                                     VA  Non-
                                                                     Judicial       VA Judicial    Deed-in-Lieu
                          Jurisdiction                             foreclosure 1   foreclosure 1  of foreclosure
                                                                         2               2
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Alabama.........................................................            $900             N/A            $350
Alaska..........................................................            1200             N/A             350
Arizona.........................................................             925             N/A             350
Arkansas........................................................            1050             N/A             350
California......................................................            1000             N/A             350
Colorado........................................................            1225             N/A             350
Connecticut.....................................................             N/A            1700             350
Delaware........................................................             N/A            1350             350
District of Columbia............................................             600             N/A             350
Florida.........................................................             N/A            2250             350
Georgia.........................................................             900             N/A             350
Guam............................................................            1200             N/A             350
Hawaii..........................................................             N/A            2400             350
Idaho...........................................................            1050             N/A             350
Illinois........................................................             N/A            1750             350
Indiana.........................................................             N/A            1500             350
Iowa............................................................             850            1300             350
Kansas..........................................................             N/A            1250             350
Kentucky........................................................             N/A            1700             350
Louisiana.......................................................             N/A            1350             350
Maine...........................................................             N/A            1750             350
Maryland........................................................            2100             N/A             350
Massachusetts...................................................             N/A            2000             350
Michigan........................................................            1000             N/A             350
Minnesota.......................................................            1025             N/A             350
Mississippi.....................................................             900             N/A             350
Missouri........................................................             950             N/A             350
Montana.........................................................            1000             N/A             350
Nebraska........................................................             900             N/A             350
Nevada..........................................................            1100             N/A             350
New Hampshire...................................................            1150             N/A             350
New Jersey......................................................             N/A            2425             350
New Mexico......................................................             N/A            1500             350
New York--Western Counties \3\..................................             N/A            2000             350
New York--Eastern Counties......................................             N/A            2400             350
North Carolina..................................................            1150             N/A             350
North Dakota....................................................             N/A            1250             350
Ohio............................................................             N/A            1700             350
Oklahoma........................................................             N/A            1450             350
Oregon..........................................................            1000             N/A             350
Pennsylvania....................................................             N/A            1650             350
Puerto Rico.....................................................             N/A            1500             350
Rhode Island....................................................            1300             N/A             350
South Carolina..................................................             N/A            1650             350
South Dakota....................................................             N/A            1250             350
Tennessee.......................................................             900             N/A             350
Texas...........................................................             900             N/A             350
Utah............................................................             925             N/A             350
Vermont.........................................................             N/A            1700             350
Virgin Islands..................................................             N/A            1800             350
Virginia........................................................             925             N/A             350
Washington......................................................            1000             N/A             350
West Virginia...................................................            1000             N/A             350
Wisconsin.......................................................             N/A            1500             350
Wyoming.........................................................            1000             N/A             350
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\1\ When a foreclosure is stopped due to circumstances beyond the control of the holder or its attorney
  (including, but not limited to bankruptcy, VA-requested delay, property damage, hazardous conditions,
  condemnation, natural disaster, property seizure, or relief under the Servicemembers Civil Relief Act) and
  then restarted, VA will allow a $350 restart fee in addition to the base foreclosure attorney fee. This fee
  recognizes the additional work required to resume the foreclosure action, while also accounting for the
  expectation that some work from the previous action may be utilized in starting the new action.
\2\ VA will allow attorney fees of $650 (Chapter 7) or $850 (initial Chapter 13) for obtaining bankruptcy
  releases directly related to loan termination. For additional relief filed under either chapter, VA will allow
  an additional $250.
\3\ Western Counties of New York for VA are: Allegany, Cattaraugus, Chautauqua, Erie, Genesee, Livingston,
  Monroe, Niagara, Ontario, Orleans, Steuben, Wayne, Wyoming, and Yates. The remaining counties are in Eastern
  New York.


    Approved: November 4, 2013.
Jose D. Riojas,
Chief of Staff, Department of Veterans Affairs.
[FR Doc. 2013-26985 Filed 11-8-13; 8:45 am]
BILLING CODE 8320-01-P