On Friday, February 16, 2007 a Conference Call was held by Anita Rechler (The Road Home Program), Vicki Vidal (MBA) and Bob Taylor (LBA).
Please see the following summary of the call.

Call Summary
 
Attendees: Anita Rechler from ICF led the call, Vicki Vidal, Mortgage Bankers Association; Bob Taylor, Louisiana Banker Association
 
Announcements
 
Since the Road Home Program began 108,000 applications have been received.  Of the 108,000 applications received 100,000 appointment letters have been sent with 75,000 appointments being scheduled and 70,000 appointments already completed.  Benefits have been offered to 41,000 homeowners.  The following is a breakdown of the options mortgagors are choosing under the Road Home Program.  13,700 homeowners have chose option 1 which states they will rebuild at their current location.  2,000 homeowners have chose option 2 which states they will sell their current property and relocate within the state of LA.  400 homeowners have chose option 3 which states they will sell their current property and not relocate within the state of LA.
 
Fundamentals
 
The Road Home calculates benefits based on pre-storm value and damages minus any other compensations from insurance carriers.  Maximum on benefits paid are $150,000.  Under the program homeowners have the option to repair/rebuild their home, sell their home to the program and relocate within the state, or sell their home to the state if they plan to relocate outside of LA.  If the homeowner decides to repair/rebuild they must agree to the following:

Comply with code, zoning, and FEMA advisory base flood elevations Remain in the home as a primary residence for a minimum of 3 years Maintain hazard and flood insurance Assign any future insurance or public benefits to the Road Home Program

Closing Procedures
 
First American Title is the closing agent for the Road Home Program.  First American will search title, confirm ownership, request subordination, insure title to the state, prepare all closing documents, conduct the actual closing, and disburse funds and documents to the lender.  The homeowner is required to sign the disbursement agreement and covenant at the closing. 
 
Repairs & Disbursements
 
Once the loan has been closed 1st American will issue the funds to the lender to be deposited into a federally insured account for disbursement to the homeowner as repairs are being completed. The check issued will be made payable to the lender only, the mortgagor is not required to endorse the check.  Any funds issued from the Road Home Program are to be disbursed for repairs to the home only.  These funds are not to be used to repay debit.
 
Upon receiving the funds the lender should contact the homeowner to advise they are in receipt of the proceeds.  The lender should explain the disbursement process and establish the condition of the property.  Lenders can release $7,500 or up to 10% but not less than $2,500 in order for repairs to begin.  This is also the case if repairs are in progress or have been completed. If repairs exceed $7,500 a licensed contractor is required to complete the repairs.  If repairs are reported to be completed the lender must schedule an inspection of the property to verify repairs prior to releasing the remaining insurance funds.  Upon final inspection of the property the lender must obtain the following:

Obtain documentation of insurance Obtain documentation of substantial completion from inspector Obtain homeowner and inspector signatures on Certificate of Final Disbursement Obtain Certificate of Occupancy - This is now optional and not required. Disburse all remaining funds to the homeowner 

An additional allowance may be issued if the homeowner wishes to elevate their property.  If an allowance is received the homeowner must elevate the property to comply with the covenants.  The actual elevation work may cost more or less than the actual allowance.  If the elevation is less the homeowner is not required to return these funds to the state.  The full amount of the allowance can be disbursed for use on additional repairs.  Repairs are to be completed within 18 months of the lender receiving the funds.  If the homeowner cannot complete repairs within 18 months contact should be made with the Office of Community Development for an extension.

To view the power point presentation referenced on the call, please click on the following link.

Best Practice Lender Training