www.hudclips.org 


U. S. Department of Housing and Urban Development
Washington, D.C. 20410-8000

April 21, 1995
 
MORTGAGEE LETTER 95-17
 
TO:  ALL APPROVED MORTGAGEES
 
SUBJECT:  Late Charges and Interest Assessed on Single Family
          Mortgage Insurance Premiums (MIP) Not Collected at
          Closing
 
          The purpose of this letter is to clarify HUD's policy
          in determining when a payment of MIP is considered late
          for purposes of applying the 4% late charge and the
          interest charge.  This mortgagee letter supersedes any
          previous handbooks, mortgagee letters or other
          instructions regarding late charges and interest
          assessed on Single Family MIP not collected at closing.
 
NOTE:     These charges do not apply to Up-Front Premiums.  See
          ML 91-26 for assessment and charges for Up-Front
          Premiums.
 
Late Charge
 
          A late charge of 4% of the total MIP remitted is due
          and shall be included in the total remittance amount
          whenever the payment is not received by HUD's lockbox
          (see Attachment #1) or Automated Clearing House (ACH)
          by the close of business on the 10th day of the month
          in which the MIP is required to be made.
 
Interest Charge
 
          Mortgagees whose Single Family MIP payments are
          received by HUD's lockbox or ACH more than 30 calendar
          days after the due date of the MIP payment shall be
          assessed interest at a rate determined by the U.S.
          Department of the Treasury, and announced periodically
          in the Federal Register by the Secretary of the
          Treasury.
 
          This interest charge is in addition to the 4% late
          charge, but the late charge is not included in the
          amount on which interest is computed.  Interest will
          accrue daily from the due date to the day of payment
          (but not including the day payment is received).  For
          example, the premium is due on February 1, 1995, and is
          received on March 3, 1995, interest would be calculated
          for 30 days (28 days in February and 2 days in March).
 
Revision of Forms
 
          The following forms are being revised to clarify those
          sections involving assessment of late charges and
          interest.  The revisions are as follows:
 
          HUD-2748 (Premium Remittance Summary)
          Line 4Q "Plus Late Charge @4% (if submitted after
          the 10th)" will be changed to "Plus Late Charge
          @4% (if received after the 10th)"
 
          HUD-2752 (Risk-Based Annual Premium:  Monthly
          Remittance)
          Line 4b "Plus Late Charges @4% (if submitted
          after the 10th)" will be changed to "plus
          Late Charge @4% (if received after the 10th)"
 
     Any questions regarding this Mortgagee Letter should be
directed to the Single Family Insurance Operations Branch on
(202) 708-1858.
 
Sincerely yours,
 

Nicolas P. Retsinas
Assistant Secretary for Housing-
Federal Housing Commissioner
 
Attachment
 
                                                              ATTACHMENT #1
 
                         CURRENT LOCKBOX ADDRESSES
 
Section 530
 
     Regular Mail                  Courier Mail
 
     U.S. Dept. of HUD             HUD/PO Box 105599/Retail
     P.O. Box 105599               Nationsbank/Operations Center
     Atlanta, GA 30348             Fifth Floor
                                   6000 Feldwood Road
                                   College Park, GA 30349
 
Risk-Based
 
     Regular Mail                  Courier Mail
 
     U.S. Dept. of HUD             U.S. Dept of HUD
     Risk-Based Insurance          Risk-Based Insurance
     Premiums                      Premiums
     P.O. Box 198053               P.O. Box 198053
     Atlanta, GA 30384-8053        6000 Feldwood Road
                                   College Park, GA 30349