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Home Affordable Refinance Program (HARP) Guide for Using HARP Consumer Solicitation Materials

May 15, 2014

Consumer Solicitation Materials for Fannie Mae-approved Lenders/Servicers This document provides instructions and terms and conditions for using the HARP consumer solicitation materials available on the Fannie Mae Business Portal at: https://www.fanniemae.com/singlefamily/harp-consumer-outreach-materials

What’s in this Guide?

1. Objectives

2. Terms and Conditions

3. Solicitation Guidelines Reminder

4. Materials Available

5. How to Use Customizable PDFs

6. Direct Marketing Best Practices

7. Sample Marketing Plans

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1. Objectives Fannie Mae developed the HARP consumer solicitation materials to help Fannie Mae-approved lenders/servicers reach out to HARP-eligible homeowners, educate them about the program’s benefits, and encourage them to refinance. By soliciting eligible homeowners for HARP, lenders/servicers can help homeowners make their payments more affordable and/or move to a more stable mortgage product (e.g., moving from an ARM loan to a fixed-rate mortgage). 2. Terms and Conditions Fannie Mae developed the HARP consumer solicitation materials for use by Fannie Mae-approved lenders/servicers only when soliciting possible HARP-eligible homeowners. These model HARP solicitation materials were created to assist participating lenders and servicers with improving consumer awareness and adoption of HARP. The contents of the HARP materials are provided "as is." The materials may be used whether the current loans are owned or securitized by Fannie Mae or Freddie Mac, except that the materials with the Fannie Mae logo may only be used to solicit borrowers with Fannie Mae loans. Fannie Mae disclaims any and all warranties. Fannie Mae shall not be liable for any errors or omissions or for any damages related to the HARP materials. Different lenders and servicers may be subject to different and/or additional requirements under federal and state law; Fannie Mae makes no representation or warranty as to the HARP materials' compliance with state or federal laws. All communications with borrowers must comply with the requirements of any applicable laws; lenders and servicers should and only revise the HARP materials as appropriate to comply with applicable laws. However, on all materials that contain the Fannie Mae logo and reference to “Fannie Mae, the owner of your loan”, the materials cannot be materially altered to change meaning or context of the materials. Any use of the Fannie Mae logo and name, outside of these HARP materials, is not allowed unless prior consent has been obtained by Fannie Mae. The HARP materials may not be appropriate for all borrowers; lenders and servicers should carefully evaluate a borrower's expected eligibility before providing any HARP materials to borrowers.

3. Solicitation Guidelines Reminder As a reminder, lenders may solicit borrowers with mortgages owned or securitized by Fannie Mae for a HARP refinance, provided:

• The LTV of the loan is greater than 80%, and • The lender simultaneously applies the same advertising and solicitation activities to all mortgages

owned or securitized by either Fannie Mae or Freddie Mac. See the Fannie Mae Selling Guide for Permissible Refinance Solicitation Practices in section B5-5.1-05, DU Refi Plus and Refi Plus Eligibility. For additional information, visit: https://www.fanniemae.com/singlefamily/making-home-affordable

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4. Materials Available Consumer materials have been developed based on consumer research and lender best practices. The following marketing collateral pieces are available:

• Door Hangers – support lender/servicer marketing efforts by providing general HARP information for placement at borrowers’ homes.

• Flyers – easy to access pieces highlight HARP’s benefits and can be displayed in banks or lenders’

offices and other locations.

• Frequently Asked Questions (FAQs) – contains a list of FAQs related to HARP and can be included with HARP letters mailed to borrowers.

• Inserts – also referred to as “buck slips,” should be printed double-sided and can be inserted into

letters, monthly mortgage statements and other correspondence mailed to borrowers.

• Letters – enable lender/servicer to provide specific information about HARP and eligibility to the borrower.

• Newspaper Ads – provide lender/servicer with templates to promote HARP in newspapers, trade

publications and other print outlets as appropriate.

• Postcards – less expensive to mail than a letter, postcards can be used as a reminder or follow-up to borrowers who were previously mailed a letter but have not responded. The postcard templates provided are oversized (6” x 11”).

• Posters – can be displayed in banks or lenders’ offices encouraging borrowers to request more HARP

information.

All marketing materials have one or both of these branding options:

• Lender/Servicer Only – these pieces and FAQs have editable fields where the lender/servicer can enter its company logo, contact information, legal disclosures, etc.

• Co-Branded – these pieces contain the Fannie Mae logo and have editable fields where the lender/servicer can enter its company logo, contact information, legal disclosures, etc. These materials also indicate that the borrower may be eligible for HARP because Fannie Mae is the owner of their loan. Recent lender/servicer results have shown that co-branded mail pieces add credibility to the offer as evidenced by higher homeowner response rates.

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Door Hanger and Newspaper Ad Versions The door hangers and newspaper ads can be used by any lender/servicer regardless of the relationship to the borrower. The pieces were designed to provide lenders/servicers with different messages to help increase HARP awareness and adoption. Versions are available with the following messages:

• Refinance – encourages borrowers to reconsider HARP as a refinancing option, even if they were turned down in the past.

• Savings – explains savings options and informs borrowers that they may still qualify for HARP.

Flyer and Poster Versions The flyers and posters can be used by any lender/servicer regardless of the relationship to the borrower. The pieces were designed to provide lenders/servicers with different messages to help increase HARP awareness and adoption. Versions are available with the following messages:

• Still Thinking About Refinancing - encourages borrowers to reconsider HARP as a refinancing option, even if they were turned down in the past.

• Monthly Savings – explains monthly savings options and how borrowers may still qualify for HARP.

Frequently Asked Questions The FAQs documents are available in two versions:

• Lender/Servicer-only – insert lender/servicer logo, information and disclosures as appropriate.

• Co-branded (Lender/Servicer and Fannie Mae logos) – insert lender/servicer logo, information and disclosures as appropriate. This document also includes a Fannie Mae logo.

Insert Versions The design and messages for the inserts are similar to the postcards. Versions are available with the following messages:

• Save Money with HARP – a generic example (table) of how much homeowners are saving on average with HARP.

• Save Money and FAQs –reinforces monthly payment savings and some of the top FAQs regarding HARP.

• $500 Off Closing Costs Incentive – can be used to highlight a closing cost incentive of up to $500 (if offered by the lender) when the borrower refinances with HARP. Lender incentive amount offers may vary, so the use of this insert should be at the lender’s discretion. For additional information about incentive guidelines, see Selling Guide Announcement SEL-2013-02.

• $2,000 Off Existing Mortgage Balance Incentive – can be used to provide the borrower information

regarding an offer (if offered by the lender) to reduce the balance of their existing mortgage by up to

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$2,000 when they refinance with HARP. Lender incentive amount offers may vary, so the use of this insert should be at the lender’s discretion. For additional information about incentive guidelines, see Selling Guide Announcement SEL-2013-02.

Letter Versions The letters are grouped into categories based on the lender/servicer relationship to the borrower:

• Current Servicer Letters – use these materials for HARP-eligible homeowners whose loans you currently service.

• New Servicer Letters – use these letters for loans, recently transferred to you for servicing, which may be eligible for HARP.

• HARP Lender/Non-Servicer Letters – use these letters to mail to homeowners whose loans you do not currently service.

Additionally, the letters are provided in versions that feature different savings/payment examples:

• Generic Payment Savings Example Letters – these letters use an average monthly payment savings example to encourage borrowers to apply for HARP. This payment savings example, “Homeowners are saving over $220 per month on average!,” is based on overall Fannie Mae HARP volume in 2012.

• Customizable Payment Savings Example Letters – these letters allow the servicer to input a specific payment savings example based on the borrower’s existing loan data and refinancing into a new HARP mortgage. The servicer can input the borrower’s current interest rate and monthly payment, estimated HARP interest rate and payment, and the difference in rate and monthly payment that may occur after refinancing with HARP. The servicer must disclose the terms and conditions of the HARP mortgage and include any legal disclosures as required.

Postcard Versions The postcards can be used by any lender/servicer regardless of the relationship to the borrower. These postcards are designed to provide lenders/servicers with different messages to help increase HARP awareness and adoption. Versions are available with the following messages:

• Save Money with HARP – based on consumer research, homeowners who have refinanced with HARP cited “lowering my monthly payment” as the number one reason for refinancing with HARP. The message on this postcard reinforces that reason – by informing homeowners they may be able to put more money in their pocket every month.

• Build Equity with HARP – focuses on the benefit of refinancing into a shorter term to build equity faster and pay off the mortgage sooner.

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5. How to Use Customizable PDFs The HARP solicitation materials available on the Fannie Mae Business Portal can be customized with lender/servicer’s name, contact information, logo, and legal disclaimers. All materials are posted on the Fannie Mae Business Portal in an Adobe PDF format. To customize these materials:

1. Select the document(s) and right-click on the link. 2. Select “Save As” and save the file to your desktop. 3. Open the file using compatible production software (e.g., Adobe Creative Suite – such as Illustrator,

InDesign, Photoshop) or you may view the files using any PDF reader (e.g., Adobe Acrobat). 4. Edit the document or merge your information in editable areas (shown in the documents with “<<

>>” – see sample on next page. 5. Start using the print-ready PDFs; they can be sent to your print vendor or direct mail provider.

Note: if you need the solicitation materials in an InDesign format, please contact your Fannie Mae Account Manager.

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Sample HARP Letter

Insert logo here Insert borrower name, address, city, state, zip and loan number here

Insert phone number and “respond by” date

Enter contact information here

Enter phone number here

Insert required disclosures on page 2

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6. Direct Marketing Best Practices

Here are a few tips on improving direct marketing effectiveness when using these HARP solicitation materials:

• Personalize by incorporating and highlighting payment information to demonstrate benefits to the borrower.

• Promote “limited time only” response deadlines. • Use an oversized envelope when mailing out letters. • Utilize overnight mail or 2-day delivery to differentiate solicitation from others. • Include a completed mortgage application with the offer letter. • Follow up and use a combination of direct mail pieces to reach the consumer—repetition is key.

Homeowners may need to see the same message three times before responding.

7. Sample Marketing Plan

In addition to the best practices described above, here are some other things to consider before launching a direct mail campaign in conjunction with the HARP solicitation materials.

• Ensure that data is current and accurate. • Plan on sending follow-up materials in a timely manner. • Compile a list of non-responders and track response rates.

Successful campaigns typically include three attempts to contact the borrower using several different approaches. Here is a sample marketing plan that can help guide your direct mail efforts:

Time Frame Direct Mail Marketing Activity/Action Week 1 Include an insert in the borrower’s monthly statement. Week 3 – 4 Send a solicitation letter and FAQs in an oversized envelope. Week 6 Send a postcard as a follow-up, if no response is received. Week 7 Follow up with a phone call or by email to non-responders.

Questions? If you have questions or concerns about using this guide, please contact your Fannie Mae Account Manager.