If the new servicer safer harbor legislation or specific sort of its introduced toward legislation, it is unclear just how of use it will be to require participating servicers to get to eradicate restrictions on the loan improvement in agreements
Because incentive payments so you can servicers and you will financial holders beneath the Amendment Program are not considered because of the REMIC statutes, it would be helpful for this new Treasury Department in order to explain you to definitely instance bonus payments wouldn’t trigger adverse tax consequences within the REMIC guidelines.
Just like the prospective income tax problems with bonus payments discussed a lot more than, this new mutual commission become made by this new Treasury Institution below this new Modification System plus introduces suspicion more than whether or not an effective securitization getting such as for example percentage will have adverse taxation effects within the REMIC guidelines. Therefore, it would be ideal for new Treasury Agency so you’re able to explain you to eg mutual payments made by the new Treasury Department would not end up in bad tax effects according to the REMIC laws.
Extra money to help you servicers and you will financial proprietors raise prospective income tax products having mortgage loans utilized in securitizations one opted for REMIC updates
- Selection Whenever Adjustment Aren’t effective. If an amendment is not needed according to the Modification System and you will not if you don’t pursued, the latest servicer is required to find almost every other property foreclosure prevention selection, as well as option amendment applications, deed-inlieu away from foreclosures and you can brief product sales apps. Read More
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