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Table of Contents
General ............................................................................................................................... 4
Mission Statement......................................................................................................... 4
Secondary Marketing ................................................................................................... 4
Secondary Marketing Functions ................................................................................. 5
Organization Chart..................................................................................................... 10
Secondary Marketing Functions ............................................................................... 11
Data Management............................................................................................................ 17
Overview ...................................................................................................................... 17
General Policy ............................................................................................................. 20
Import of Funded Loans ............................................................................................ 20
General Policy ............................................................................................................. 22
Import of Servicing Data............................................................................................ 22
General Policy ............................................................................................................. 24
Forward Commitment Pool Formation .................................................................... 24
General Policy ............................................................................................................. 27
Premium Loan Bid Pool Formation.......................................................................... 27
General Policy ............................................................................................................. 30
Discount Loan Pool Formation.................................................................................. 30
General Policy ............................................................................................................. 33
Update Sold Loan Inventory Information................................................................ 33
Update Sold Loan Inventory Information................................................................ 34
General Policy ............................................................................................................. 35
Repurchase Import ..................................................................................................... 35
Repurchase Import ..................................................................................................... 36
General Policy ............................................................................................................. 37
Sweeps .......................................................................................................................... 37
General Policy ............................................................................................................. 42
Periodic Inventory Reporting .................................................................................... 42
Knowledge Management
SECONDARY MARKETING
Policies – Table Of Contents
Knowledge Management
SECONDARY MARKETING
Policies – Table Of Contents
Knowledge Management
Secondary Marketing
Policies –General
General
Mission Statement
Primary Mission The primary mission of Secondary Marketing is to accumulate
and analyze mortgage assets held by New Century Capital
Corporation and either hold such assets within inventory as
investment assets or selectively aggregate such assets into
groups available for sale to third party Investors or a
securitization trust.
Secondary Marketing
Objectives The objectives of Secondary Marketing are to ensure adequate
liquidity on existing warehouse lines of credit and to maximize
the value received, to the extent possible, for each loan or pool
of loans sold by NCCC.
Responsibilities As part of its primary mission, Secondary Marketing is
responsible for:
• Downloading closed loan information from the Loan
Origination System (“LOS”) and maintenance of a
Secondary Marketing database that includes information
on all loans previously sold and available for sale.
• Monthly clearing of warehouse funding facilities.
• Aggregation of loans into pools for sale to third party
Investors.
• Negotiation of the pricing of pools with third party
Investors.
• Coordination of transfer of loan pools to the purchasing
Investor
• Receipt of verification of funds from the sale of such loan
pools
• Repurchasing loans that may breach the
Representations and Warranties established with third
party investors.
• Aggregation of loans for sale to a securitization trust
(See Securitization Policy and Procedures)
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Repurchases
• NCCC Loan Sales Management is authorized to
approve the repurchase of any loan from an Investor.
Knowledge Management
Secondary Marketing
Policies –General
Data Management:
• The Trader and NCCC Loan Sales Management review
uncommitted inventory reports on a weekly basis
• Inventory reports are reconciled with accounting records
on a monthly basis
• Sweeps are reconciled with accounting records each
month
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Investor buy rates are the interest rate at which the Investor will
pay par value for a loan. To the extent that the interest rate on
a loan exceeds the buy rate, the Investor will pay a premium
determined by the amount of excess interest rate over the buy
rate. In addition, Investors seek to purchase loans with certain
characteristics or certain product types. In the event that
NCCC originates a loan outside of Investors purchase
parameters, such loans may not be sellable to an Investor.
Knowledge Management
Secondary Marketing
Policies –General
Organization Chart
NCCC
Kevin Cloyd
SVP VP VP VP
VP
Loan Structured Production Alternative
Capital Mkts Orig
Administration Finance Performance Products
Lee Holbein
Robin Cook Warren Licata Rick Rhinehart Rick Holguin
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing
Policies –General
Knowledge Management
Secondary Marketing Policies
Data Management
Data Management
Overview
The primary responsibilities of the Secondary Marketing Analyst relating to data
management include:
• Import funded loan information from the Data Warehouse into the Secondary
Marketing Database, PowerSeller
• Research loans with exceptions or missing data by obtaining correct
information from the originator or the servicer, by reviewing documentation,
etc.
• Update funded loan outstanding balances and servicing information for funded
loans maintained in PowerSeller by importing loan level information from
applicable servicing systems
• Create Commitment Pools required to fulfill sales commitments between
NCCC and certain Investors
• Create Premium Loan Bid Pools for bid by Investors
• Create Discount Pools for bid by Investors
• Update Sold Loan Information within PowerSeller
• Remove repurchased loans from the loans shipped database and import
repurchased loans back into NCCC inventory
• At the direction of the Controller of NCCC, loans held in individual bank
warehouse lines are to be moved to either the Citigroup or Morgan Stanley
aggregated warehouse lines
• Periodic inventory reporting
Knowledge Management
Secondary Marketing Policies
Data Management
Overview
The following summarizes the Data Management processes for Secondary Marketing:
• Premium Loan Bid Pool Formation: Loans held in inventory by NCCC may be
pooled together and subsequently bid on by Investors wishing to purchase such
pools of loans. The Secondary Marketing Analyst, at the direction of the Trader,
creates pools of loans that are performing and that meet Investor requirements.
• Discount Pool Formation: Closed loans that are not performing or that may have
been rejected from prior premium loan bid pools may be combined together and
subsequently bid on by Investors wishing to purchase such pools of loans. The
Secondary Marketing Analyst, at the direction of the Trader, creates pools of loans
that meet such criteria.
Knowledge Management
Secondary Marketing Policies
Data Management
Overview
• Update Sold Loan Information: Once the final purchase of pooled loans occurs,
the Secondary Marketing Analyst is responsible for updating sold loan
information within PowerSeller.
• Repurchase Imports: Periodically, funded loans that are sold to Investors may be
repurchased by NCCC due to breaches of certain covenants in a purchase
agreement. These covenants include, but are not limited to, first payment
defaulted loans, fraudulent loans, or loans that do not meet other Investor criteria.
Such repurchased loans are re-added to the NCCC inventory of assets.
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Import of The Secondary Marketing Analyst is responsible for ensuring the
Funded import of funded loan information from the Data Warehouse to the
Secondary Marketing Database each business day.
Loans
The information imported includes prior day funded loan data and
an update of loan information on funded loans where a data field
has changed during the past five (5) days. By importing any data
changes to prior funded loans (which may have already been
imported into PowerSeller), Secondary Marketing ensures that all
data stored within PowerSeller is the most current information
available.
It is possible that some records will not be imported during the initial
import due to data inconsistencies, such as a missing loan number
or the incorrect formatting of a loan number. Any records not
imported are available on an error report screen within PowerSeller
after the import is run. The records that are not imported will have
to be manually researched and corrected within the original text file.
Once the information is added or corrected in the original text file,
the import process is manually run again to import the corrected
loan information.
Continued…
Knowledge Management
Secondary Marketing Policies
Data Management
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Import of The Secondary Marketing Analyst is responsible for ensuring the
Servicing update of loans in PowerSeller with current loan balances and
payment status through a manual or automated import of
Data
information from both the Ocwen and MortgageServe servicing
systems.
Continued…
Knowledge Management
Secondary Marketing Policies
Data Management
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Forward The Secondary Marketing Analyst is responsible for creating a data
Commit- file, which represents a pool of loans from the available funded loan
inventory that meet the commitment requirements dictated by the
ment Pool
Forward Commitment Letter.
Formation
Knowledge Management
Secondary Marketing Policies
Data Management
Knowledge Management
Secondary Marketing Policies
Data Management
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Premium The Secondary Marketing Analyst is responsible for creating data
Loan Bid files, which represent pools of loans from the available funded loan
inventory, that meet the purchase requirements of Investors.
Pool
Formation
Knowledge Management
Secondary Marketing Policies
Data Management
The premium loan bid pool data file is forwarded to the Trader for
review, where upon approval, the Trader will submit the data file to
the Investor(s) (via email).
Knowledge Management
Secondary Marketing Policies
Data Management
Distribution The premium loan bid pool data file is distributed to the
Require- Transaction Manager/Trader and NCCC Loan Sales Management
as needed. A copy of the final premium bid pool data file will be
ments
distributed by the Secondary Marketing Analyst to the Transaction
Manager (for sending to the Investor) and the Loan Administration
Department (in order for Vault personnel to pull files for the
Investor’s due diligence review) by electronic mail.
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Discount The Secondary Marketing Analyst is responsible for creating data
Loan Pool files, which represent pools of loans from the available funded loan
inventory that may not be to Premium Investors due to delinquency
Formation
or some other underwriting exception that excludes it from the
Investors requirements.
Knowledge Management
Secondary Marketing Policies
Data Management
Once the loans that meet the discount loan pool requirements have
been identified within PowerSeller, the Secondary Marketing
Analyst exports the loan characteristics associated with identified
loans to an Excel spreadsheet, the discount loan pool data file.
The discount loan pool data file requires formatting prior to
finalization (See [detailed procedures] for instructions on the data
file formatting)
The discount loan pool data file is forwarded to the Trader for
review, where upon approval, the Trader will submit the data file to
the Investor.
Review The Trader is responsible for reviewing the discount pool data file
Require- and finalizing the discount pool population prior to approval of the
ments pool for submission to the Investor.
Knowledge Management
Secondary Marketing Policies
Data Management
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Update Sold Once the purchase of pooled loans become final, the Secondary
Loan Marketing Analyst is responsible for updating sold loan information
within PowerSeller.
Inventory
Information
Review The Trader is responsible for reviewing the discount pool data file
Require- and finalizing the discount pool population prior to submitting to the
ments Investor.
Continued…
Knowledge Management
Secondary Marketing Policies
Data Management
Required The Secondary Marketing Analyst is to save a copy of the sold loan
Documen- information spreadsheet on the NCCC network after the import
process is completed. These sold loan information spreadsheets
tation may be used by the Trader to track the historical purchases by
Investors.
Distribution A summary report of the loans sold and related pricing should be
Require- distributed to NCCC Loan Sales Management via electronic mail
each month end.
ments
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Repurchase Upon notification of a repurchased loan by the Repurchase
Import Specialist, the Secondary Marketing Analyst is required to remove
the repurchased loan from the “shipped loan” table and add the
repurchased loan to the NCCC Loan Inventory in PowerSeller.
Repurchase Import
Process Periodically, funded loans that are sold to Investors may be
repurchased by NCCC due to breaches of certain covenants in a
purchase agreement. These covenants include, but are not limited
to, first payment defaulted loans, fraudulent loans, or loans that do
not meet other Investor criteria. Such repurchased loans must be
re-added to the NCCC inventory of assets.
Knowledge Management
Secondary Marketing Policies
Data Management
Repurchase Import
Review NCCC Loan Sales Management and the Repurchase Specialist are
Require- responsible for reviewing monthly “Repurchased added to
ments inventory” reports to ensure that all repurchases have been
accounted for.
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Sweeps At the direction of the Controller, the Staff Accountant is
responsible for removing funded loans, referred to as “sweeping”,
from the bank warehouse credit facilities (also referred to as bank
lines) and transferring them to one of the aggregated warehouse
credit facilities. This will ensure that there is capacity on the bank
warehouse credit facility to continue to fund loans. A sweep usually
removes the prior months funded loans from the individual bank
warehouse credit facilities. All loans removed from the bank
warehouse credit facilities are to be alternately placed in one of the
six aggregated warehouse credit facilities. However, each
aggregated warehouse credit facility may have sub-limits or specific
loan acceptance criteria. Only those loans which meet the
aggregated warehouse credit facility requirements should be
transferred to such accounts.
Sweeps
Process On a periodic basis, NCCC will create funding capacity by
selectively moving closed loans financed by certain bank
warehouse lines and transferring them to Citigroup, Morgan
Stanley, Bear Stearns, Barclays, CSFB, or Von Karman
aggregated warehouse lines. The Secondary Marketing analyst is
responsible for selecting the loans to be moved, notifying the
individual banks in writing of the removal of such loans from their
warehouse lines, and notifying the banks with the aggregate
warehouse lines in writing of the addition of such loans.
Knowledge Management
Secondary Marketing Policies
Data Management
Sweeps
Process Deutsche Bank as custodian for the files. This data file will be
emailed to the designated Deutsche Bank personnel as Deutsche
Bank must prepare the actual files for shipment to the designated
custodian for the aggregated warehouse lines. An exception report
must also be requested.
From the above created file, a separate excel file is also created for
import into PowerSeller. This report, which is to be saved in text
format, should contain only the loan numbers of the selected loans
in a 10 digit format. (see [detailed procedures] for instruction on
producing and formatting the data file)
Knowledge Management
Secondary Marketing Policies
Data Management
Sweeps
Process The data file sent to Citigroup is required to be in a specific format.
(See [detailed procedures] for formatting the file)
Knowledge Management
Secondary Marketing Policies
Data Management
Sweeps
Required The Staff Accountant is to save a copy of the data files sent to all
Documen- designated warehouse line personnel on the NCCC network with
tation access limited to NCCC Loan Sales Management, the Controller,
and the Secondary Marketing Analyst through password protection.
Also, a signed copy of the Request for Release Letter should be
maintained in Secondary Marketing files.
Bank of America
• Chris Young -- 704-388-8403
• Jennifer Kovish -- 704-386-3614
CDC
• John Racy -- 212-891-5816
• Chris Matzelle -- 212-891-5826
• Robert Les -- 212-891-5828
UBS
• Steve D'Orazio -- 212-352-8881
• Cheryl Johnson -- 212-352-8883
Citigroup
• Bobbie Theivakumaran -- 212-723-6753
• Ellen Simone -- 212-615-7725
• Lou Rebecchi -- 212-615-9264
Continued…
Knowledge Management
Secondary Marketing Policies
Data Management
Sweeps
Bear Stearns
• Cynthia Knowles -- 212-272-7015
• Nick Wells -- 212-272-3368
• Lars Berg -- 212-272-3676
• Matt Lederman -- 212-272-5686
Barclays
• Glenn Pearson -- 973-576-3179
• Hansel Nieves -- 973-576-3189
• Walter Kunisch -- 973-576-3321
CSFB
• Tim Callahan -- 609-627-5053
• Kelly Corby -- 609-627-5032
• Gary Timmerman -- 609-627-5026
Knowledge Management
Secondary Marketing Policies
Data Management
General Policy
Periodic The Secondary Marketing Analyst is responsible for all funded loan
Inventory inventory reporting.
Reporting
Knowledge Management
Secondary Marketing Policies
Data Management
Distribution The Total Unsold Inventory and Aged Investor Committed Reports
Require- should be distributed to NCCC Loan Sales Management by the end
of each business day. The month end Total Unsold Inventory
ments
should be distributed to the person responsible for preparing the
Board of Directors Package.
Knowledge Management
Secondary Marketing Policies
Transaction Management
Transaction Management
Overview
Transaction Management includes the selection, pooling, and selling of pools of loans
from NCCC Inventory. These pools of loans may consist of either premium loans or
discount loans. While many of the processes of selecting, pooling, and selling of
pools of loans are similar for both pool types (premium and discount), there are
certain procedures specific to each pool type. A “Trader” is responsible for the
management of this process.
Knowledge Management
Secondary Marketing Policies
Transaction Management
Overview
Knowledge Management
Secondary Marketing Policies
Transaction Management
Overview
The following summarizes the processes for the Trader:
• Discount Loan Pool Formation and Bid Process: The Discount Loan Trader
will provide the Secondary Marketing Analyst with the loan characteristics or
parameters to create discount loan pools. With knowledge of various Discount
Investor’s purchase requirements, purchase history, and pricing, the Discount
Loan Trader will create discount pools to maximize the pricing paid and sale
execution for such discount loans. An electronic file containing loan level
information on the discount pool will be submitted to Discount Investors for their
review and subsequent bid for purchase.
Knowledge Management
Secondary Marketing Policies
Transaction Management
Overview
For Premium and Discount Bid Pools:
• Analyze Bids and Award Sale: Once a premium loan pool or discount loan pool
is created, it will be submitted to several Investors for bidding (No bid process is
necessary for forward commitment pools). The Trader is responsible for
analyzing and reviewing each bid by the Investors to maximize the pricing paid
and the sale execution for each loan pool. The Trader, with approval of NCCC
Loan Sales Management, will award the sale of a pool to the appropriate Investor
and create a Trade Ticket.
• Coordinate and Finalize Final Pool Population: During the due diligence
process, certain loans may be added or removed from the proposed pool. After
review of loan files, the Investor will determine which loans they will purchase from
the pool. The Transaction Manager will then prepare a final tape of the loan
pool. The Trader must also request the collateral of the final pool population be
shipped to the Investors custodian.
Review and Verify Funds Received from Sale: Once the final purchase of loan
pool occurs, the Transaction Manager will verify that the agreed upon funds have
been received from the sale of the pool. The Transaction Manager will also notify
various NCCC departments of the closing of the transaction.
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Assist in From time to time, NCCC may enter into forward commitments with
Establishing Investors. These commitments dictate specific loan characteristics
and volumes requested by the Investor for purchase. The
Forward
Transaction Manager is responsible for assisting NCCC Loan
Commit- Sales Management in negotiating forward commitments or
ments establishing forward commitments within authority limits. See
Section 1 of the Loan Sales Policies and Procedures for Authority
Limits.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Forward The Trader is responsible for providing the pool characteristic
Commit- requirements and pool amounts for forward commitments and
premium loan pools to the Secondary Marketing Analyst. The
ment and
Secondary Marketing Analyst will create pools of loans from NCCC
Premium Inventory that meet such requirements.
Pool
Formation
Knowledge Management
Secondary Marketing Policies
Transaction Management
Upon the receipt of the electronic pool data file from the Secondary
Marketing Analyst, the Trader will review the data file and delete
any loan information not necessary for the Investors review. The
data file will then be emailed to the commitment Investor (if the pool
is a commitment pool) or to multiple Investors for independent sale
bids (if the pool is a bid pool). The Trader will maintain a
spreadsheet to track specific pools, Investors that the pools are sent
to, and for bid pools, the cut off date and times for Investors to
respond by. This spreadsheet, as well as contact information for all
Investors, should be maintained on the NCCC network in an
Investor subdirectory.
Timing Forward commitment and premium loan bid pools are created and
sent to Investors during the first half of the month to allow adequate
time for the sales process. For premium bid pools, bid responses
are requested from Investors approximately 3 to 4 days after the
premium loan pool is initially sent to the prospective Investors.
Required The Trader is to save the commitment pool and premium loan bid
Documen- data files on the NCCC network. For premium loan bid pools, the
Trader should also save the spreadsheet containing Investor
tation contact information and the cutoff date and times on the NCCC
network. (See Approval, Authority Limits, and Access section of the
Loan Sales Policies and Procedures for authorized access)
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Review and The Trader is to review monthly reports containing all uncommitted
Analyze inventory. This inventory may include funded loans that have been
declined by Premium Investors or loans that are non-performing.
Discount
Loans
Loans eligible for sale to Discount Inventors include loans that are
not delinquent more than 59 days, but include one or more of the
following characteristics: LTV exception, debt ratios outside of
standard limits, BPO exceptions, compliance issues, missing docs,
or prior Premium Investor declines. Pools of non-performing loans,
which include loans delinquent 60 or more days, may also be sold
to certain Discount Investors. Loans that are in review by the
NCCC legal department are not eligible for sale through either the
premium or discount sales.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Re-Under- The Trader is responsible for identifying performing discount loans
that may be eligible for re-underwriting. Such loans will be
writing forwarded to the Vice President – Loan Enhancement for review.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
Distribution The Trader is to distribute a list of the identified loans for re-
Require- underwriting to the Vice President – Loan Enhancement.
ments
General Policy
Discount The Trader is responsible for developing the pool characteristic
Loan Pool requirements for discount pools. Using knowledge of Discount
Investor’s appetites for certain discount loans and the market pricing
Formation
for such loans, the Trader will create one or more discount pools for
and Bid sale to Discount Investors.
Process
Knowledge Management
Secondary Marketing Policies
Transaction Management
Upon the receipt of the discount pool data file(s) from the
Secondary Marketing Analyst, the Trader will review the data file(s)
and delete any loan information not necessary for the bidding
process from the data file(s). The data(s) file will then be emailed to
one or more Discount Investors for independent sale bids. The
Trader will maintain a spreadsheet to track specific pools, Discount
Investors that the pools are sent to, cut off dates and times for
Discount Investors to respond by. This spreadsheet, as well as
contact information for all Discount Investors, should be maintained
on the NCCC network in the Discount Loan Sales subdirectory.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
Approval The Trader is approved to submit discount loan pools for bid to
Require- Discount Investors in amounts within their authority limits (see
ments Section 1 of these Policies and Procedures for authority limits). The
discount loan pool strategy should be discussed with and approved
by NCCC Loan Sales Management each month.
Back Up If the Trader is unable to perform the discount pool formation or bid
Procedures process, an auxiliary approved person should perform these duties.
Required The Trader is to save the discount loan data files and a spreadsheet
Documen- of bid submission information on the NCCC network. (See
tation Approval, Authority Limits, and Access section for authorized
access)
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Analyze The Trader is responsible for analyzing and reviewing each Investor
Bids and bid response for bid pools. Based on bid pricing and sale execution
history, the Trader, with approval by NCCC Loan Sales
Award Sale
Management, selects the winning bidder. The goal of the Trader is
to maximize the number of loans sold in a pool at the least
discounted price. A Trade Ticket is to be created upon the
awarding of a pool sale to the winning bidder.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
Timing The analysis and awarding of bids occurs within 24 hours of the bid
submission cutoff time.
Approval The Trader is approved to review Investor Bids and award the sale
Require- of a pool within their approval limits. However, final approval of
ments awarding the sale of the bid pool that is outside of establish
authority limits is to be given by NCCC Loan Sales Management.
Back Up If the Trader is unable to perform the analysis and review of Investor
Procedures bids, NCCC Loan Sales Management is to perform these duties.
Refer to the disaster recovery document in Attachment 1 for NCCC
approved procedures in the event of a business disruption.
Required The Trader gives the Transaction Manager the Loan Sales Bid
Documen- Matrix and keeps copies of all bid submissions in the NCCC Loan
tation Sale file. This would be a copy of the Loan Sale Bid Matrix used by
the Trader to gather bid data prior to awarding the bid. In addition,
a copy of the Commitment Letter should be kept within the Traders
files.
The Trader completes the Loan Sale Bid Matrix while gathering
data prior to awarding pool. Upon awarding pool, the Trader
gives Loan Sale Bid Matrix to Transaction Manager. The
Transaction Manager keeps Loan Sale Bid Matrix in the Loan
Sales File and all other relevant deal documentation for a
period of one year.
Note: The Loan Sale file includes, but is not limited to the
following:
• Trade Ticket
• Loan Sale Bid Matrix
• Commitment Letter
• Wire Instructions
• Security Releases
• Final Reconciliation page of Investor funding schedule
• Funding Memo completed by Transaction Manager (signed
off by VP, SVP, or President of NCCC).
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Schedule The Transaction Manager is responsible for coordinating the due
Due diligence process with the winning bidder and notifying the Loan
Administration Department to pull the loan files for review by the
Diligence
purchasing Investor.
The Trader must also request from the Servicing Department loan
level pay histories and collection notes. This request is made by
sending an email with an electronic data file containing information
on the loans to an appropriate person in servicing. Servicing will
forward this information to Loan Administration for inclusion in each
loan file being reviewed by the Investor.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
General Policy
Finalize Upon final review and approval of the proposed bid pool by the
Pool Investor, the Trader prepares the final pool tape and coordinate with
the Investor for the shipment of the collateral files to the Investor’s
Population
custodian.
Knowledge Management
Secondary Marketing Policies
Transaction Management
Knowledge Management
Secondary Marketing Policies
Transaction Management
Timing The coordination and finalizing of a discount pool may take from 7
to 10 days from the awarding of a sale pool.
Required The Transaction Manager keeps a copy of the final agreed upon
Documen- schedule on the NCCC network at G/Shared/SecondaryLoanSale
tation (See Approval, Authority Limits, and Access section for authorized
access). Also, a copy of the Trade Ticket, Loan Sale Bid Matrix,
Commitment Letter, Wire Instructions, Security Releases, Final
Reconciliation page of Investor funding schedule, Funding
Memo, and the Request for Release Letters should be included in
Secondary Marketing files.
General Policy
Review and Once the final approval and purchase of the loan pool occurs, the
Verify Transaction Manager will verify that the agreed upon funds have
been received from the sale of the discount pool. The Transaction
Funds
Manager is also responsible for notifying various NCCC
departments of the closing of the transaction after the payment for
the pool is received by NCCC.
Knowledge Management
Secondary Marketing Policies
Transaction Management
The Trader is to obtain the FED Reference Number for the funds
sent by the Investor and forward this information to the Accounting
Department. The Accounting Department will notify the Trader by
email when the funds have been received.
Timing The review and verification of funds should be completed at the time
funds are received from the Investor.
Continued…
Knowledge Management
Secondary Marketing Policies
Transaction Management
Back Up In the event the Trader is unable to review and verify the funds from
Procedures the settlement, NCCC Loan Sales Management is designated to
perform such duties.
Notification Upon the completion of the pool sale, the Trader is responsible for
Require- distributing a notification to the following departments:
ments • Accounting – to reconcile the accounting records
• Loan Administration – to track sold files
• Secondary Marketing Data Management – to update
Powerseller
• Servicing – to take over and work with the investor on
transferring servicing rights and sending out of servicing
release notice to the borrowers, if applicable
• Legal – to update their records
• Shipping and Vault – to update their records
The notification should include a listing of the loans sold within the
pool.
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
• Coordinate the Return of the Loan File to NCCC: In the event that a loan is
repurchased by NCCC, the Repurchase Specialist will coordinate the return of the
collateral from the Investor to the NCCC Custodian.
• Coordinate the Wire Request for a Repurchased Loan: Upon the approval of
NCCC Loan Sales Management to repurchase a loan, the Repurchase Specialist
will complete a wire request form, which after being signed and approved by
NCCC Loan Sales Management will be forwarded to the NCCC Accounting
Department.
At the end of the month, the Repurchasing Specialist will print out a complete
copy of the Repurchase transaction spreadsheet and distribute it to the AVP, VP
and SVP of Secondary Marketing for review.
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
General Policy
Receive and The Repurchase Specialist is the primary contact person for any
Record repurchase requests made by an Investor. The Repurchase
Specialist will log the receipt of the request and direct the
Initial
repurchase request to NCCC Loan Sales Management for their
Repurchase review.
Request
Continued…
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
Required The Repurchase Specialist is to save the tracking log on the NCCC
Documen- network. A copy of the of the Investor’s request for repurchase
tation should be attached to the Repurchase Summary Form and a copy
should also be saved in the Secondary Marketing files. Requests
for repurchase that are received, but denied, should also be saved
in the Secondary Marketing files for future reference.
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Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
General Policy
Forward The Repurchase Specialist is responsible for providing the
Repurchase Repurchase Summary Form and a copy of the Investor’s request for
repurchase letter to NCCC Loan Sales Management. NCCC Loan
Requests
Sales Management will determine whether the repurchase requests
and Track will be granted without investigation or if research by Secondary
Progress Marketing personnel or the NCCC Legal Department is necessary
to support the approval. The Repurchase Specialist is also
responsible for tracking the current progress of investigations
concerning repurchase requests.
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Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
The Repurchase Specialist will create a hard copy file upon receipt
of the Repurchase Request. Such file will contain any
correspondence received between NCCC and the Investor. For
repurchase requests that are forwarded to the Legal Department,
the Legal Department will provide to the Repurchase Specialist a bi-
monthly report that tracks the chronology of events and work
performed on any loan repurchase request. These bi-monthly
reports will also be maintained in the Repurchase Specialist’s files.
The Repurchase Specialist will update NCCC Loan Sales
Management on outstanding repurchase requests and the loan-by-
loan status of repurchase requests each month.
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
General Policy
Coordinate The Repurchase Specialist is responsible for coordinating the return
the Return of the repurchased loan file from the Investor’s custodian to the
NCCC Custodian.
of Re-
purchased
Loan Files
Loan Files that are returned to NCCC or its custodian are done so
using a Bailee Letter to protect each party’s interest. (See
Transaction Management for a description of the Bailee Letter)
In some cases, the Investor may also possess the original credit
portion of the file (appraisal, credit reports, etc.). In this case, the
Repurchase Specialist will direct the Investor via email
correspondence to send such file to the NCCC Loan Administration
(the Vault). Otherwise, the Repurchase Specialist will contact the
Loan Administration Department and request that they obtain the
credit file from permanent storage and relocate such file to the
Vault.
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Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
General Policy
Coordinate The Repurchase Specialist is responsible for obtaining from the
the Wire Investor the amount required to repurchase a loan. The
Repurchase Specialist will prepare a Wire Request Form and
Request
submit such form to NCCC Loan Sales Management for approval.
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
Approval NCCC Loan Sales Management is required to approve and sign the
Require- Wire Request Form for a repurchased loan.
ments
Back Up In the event the Repurchase Specialist is unable to complete the
Procedures Wire Request Form for a repurchased loan, the Trader is
designated to perform such duties.
Knowledge Management
Secondary Marketing - Policies
Loan Repurchases
General Policy
Coordinate The Repurchase Specialist is responsible for ensuring that the
Repurchase Secondary Marketing Analyst is supplied with updated loan
information regarding repurchased loans. The Secondary
Information
Marketing Analyst will update PowerSeller with this information and
with Data ensure that the repurchased loan is added to NCCC loan inventory.
Manage-
ment
Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
Page 1 of 2 (11/04/06) Latest revised items in bold blue.
Overview
The following summarizes the main functions of the Shipping Department:
• Process Servicing & Collateral Packages: The Shipping Department
receives Servicing and Collateral Packages for funded loans from the
Vault area on a daily basis. The Shipping Analyst forwards the Servicing
and Collateral Packages to the Shipping Process Analyst. The Shipping
Process Analyst then sends the Servicing Package to the New Century
Mortgage Servicing Division.
• Audit The Collateral Package: The Shipping Process Analyst audits the
Collateral Package and reviews data in the Loan Origination System
(LOS). If guidelines are not met, the Shipping Process Analyst forwards
the Collateral Package to the Shipping Supervisor. If guidelines are met,
the Shipping Process Analyst generates a Corporate Assignment and
prepares the Note Endorsement to complete the Collateral Package. The
Shipping Process Analyst ships the complete Collateral Packages to
Deutsche Bank on a daily basis.
• Process Fatal Exceptions For Collateral Packages: The Shipping
Assistant receives the Daily & Aggregate Fatal Exception Reports from
You
Are Deutsche Bank. The Shipping Assistant may request the Base File (if
Here needed) or access the Imaging System to locate missing documents. The
Shipping Assistant “cures” any fatal exceptions by obtaining any missing
documents and/or correcting any documents with assistance of funder.
The “cured” documentation is then sent to Deutsche Bank in an envelope
with the daily collateral by overnight delivery.
• Monitor The Zero Collateral Report: The Shipping Supervisor receives
the Deutsche Bank Aging Report and Data Repository Shipping Report
Packages. The Shipping Supervisor compares both reports for outstanding
items that have not been received from the Branches / Offices. These
outstanding items become Zero Collateral Amounts if not received within
specified timeframes. The Shipping Supervisor reviews the Zero Collateral
Amount Exceptions from the previous day and documents all outstanding
exceptions on the Zero Collateral Report. The Shipping Supervisor
monitors the clearing of all Zero Collateral Amount Exceptions.
• Distribute The Zero Collateral Report: The Shipping Supervisor
generates the Zero Collateral Report on a daily basis. The Shipping
Supervisor distributes the report by e-mail to all appropriate parties.
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
Page 2 of 2 (11/04/06) Latest revised items in bold blue.
Overview
• Inventory Control Audit Process: The ICAP Specialist locates the
Funding Control Sheet in the Base File and verifies the loan number and
borrower name. The ICAP Specialist reviews the HUD-1 statement and
determines whether it is an estimated or final HUD-1. The ICAP Specialist
places a barcode on the document. The ICAP Specialist enters information
into Uniform and reviews documents in the Base File. Lastly, the ICAP
Specialist turns in Base Files to the vault so that they may be imaged by
the Imaging Vendor.
• Appendix: The following information is found listed within the Shipping
Procedures: Acceptable Collateral Guidelines.
Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
Page 1 of 8 (11/04/06) Latest revised items in bold blue.
(7 Steps)
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
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(7 Steps)
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
Page 3 of 8 (11/04/06) Latest revised items in bold blue.
(7 Steps)
Step 2 The Shipping Assistant reviews the Base File or the Imaging
System to locate any missing documents.
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
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(7 Steps)
Step 3 After reviewing the Base File or Imaging System, the Shipping
Assistant corrects any information in the appropriate Loan
Origination System (LOS).
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
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(7 Steps)
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SHIPPING
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Packages
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Knowledge Management
SHIPPING
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Packages
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Knowledge Management
SHIPPING
Procedure – Process Fatal Exceptions For Collateral
Packages
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(7 Steps)
Knowledge Management