60-Day Extension for ML 10-18 Cost Exhibit:
1) Due to programming time constraints in transitioning P&P costs from ML 08-31 to ML 10-18, would HUD consider extending the implementation time?
Answer – HUD will allow for a 60 day extension for the continued use of ML 08-31 cost schedules listed as Attachments 1-10 in the Mortgagee Letter. During this time, we expect the lender to migrate towards ML 10-18 pricing and system coding.
· Work completed post 7/13 may be charged at the ML 08-31 cost with appropriate documentation during the 60 day extension.
· As of 7/13, the property cap of $2,500 will go into effect for all loans, including those in the pipeline.
· The lender is allowed an aggregate cost per property of $2,500 whether the cost schedule of ML 08-31 or ML 10-18 is used; however, justifiable documentation to support the cost should be included in the Part B & C Claim documentation.
· As of 7/13, “spent to date” is the aggregate of all work completed on the property, including all items considered “routine” per ML 10-18 (inspections, pool securing, interior debris removal, etc.)
· During this 60 day extension timeframe, if aggregate cost is greater than $2,500 and subsequent work can be completed for the allowable cost of either ML 08-31 or ML 10-18, no overallowable is needed.
· If the mortgagee has previously received an overallowable approval for a re-occurring expense, there is no need to obtain another approval.
The lender will be required to indicate which cost scheduled has been used on an overallowable request in the individual line item section “Mortgagee Remarks”. If no overallowable is needed, the cost scheduled used must be notated in Part B & C Claim documentation.
Extension for Grass Cut Cost Schedule
1) We have already negotiated the contractor pricing for grass cuts this season. Would HUD consider using the grass cut schedule from ML 08-31?
Answer – HUD recognizes that this Mortgagee Letter was released in the middle of the grass cut season; therefore, HUD has made an exception to allow the use of ML 08-31, Attachment 6 “Yard Maintenance and Snow Removal Requirements, Page 39 through the end of the 2010 grass cut season. It is anticipated that after this timeframe, HUD will begin utilizing a Cost Estimator product for the grass cut expense. In the event that HUD’s Cost Estimator is not ready for production, HUD will make the determination to possibly extend the use of the ML 08-31 grass cut cost schedule for an additional period of time.