Common Manual Update #139

To assure that your Common Manual remains current, please record this document on your LPM/LPB index, and retain it in Appendix E of your manual. 

Made-up Collection Activity Clarified

The term "made up" collection activity will be added to the text of the Common Manual to more accurately reflect certain due diligence violations. If there are one or two due diligence violations of 6 days or more each (21 days or more in the case of a transfer) and no gap of 46 days or more (61 days or more in the case of a transfer) and the lender completed all the required collection activities before the claim filing deadline, the activities will be considered made up. However, any made up collection activity for an endorser will not be assessed a violation (see subsection 8.1.E. of the Common Manual) If a collection effort (verbal or written) is made up after the date the final demand letter is sent, it must support the final demand letter.

This change will be enforced for loans on which the first day of delinquency on the oldest outstanding due date is after July 1, 1996. The oldest outstanding due date is the date from which current 180-day due diligence counter is based and is sometimes referred to as the "latest", "current", or "next" due date. A lender may have implemented the new due diligence requirements earlier than the enforcement date. However, the lender must have contacted the guarantor to inform the guarantor of the early implementation. Subsections 8.1.D. and 8.8.C. of the Common Manual will be revised to incorporate this clarification.