The Federal Housing Administration (FHA) case binder module “Catalyst” now has additional functionality designed to streamline the review of loans post-closing, along with adding new requirements for the electronic submission of case binders selected for post-endorsement review in the Loan Review System (LRS). This is according to the publication of Mortgagee Letter (ML) 2020-29 published this week.

“On March 20, 2020, FHA temporarily suspended the requirement for Mortgagees to submit paper case binders for post-endorsement review in LRS,” the letter reads. “The suspension was the result of operational challenges related to the COVID-19 National Emergency. Mortgagees approved for electronic Case Binder (eCB) submission were instructed to continue submitting case binders through FHA Connection.”

This instruction was revised further with the publication of ML 2020-07 in April, which implemented FHA Catalyst’s case binder module as a platform that mortgagees could submit both forward and Home Equity Conversion Mortgage (HECM) case binders, though the initial functionality did not include the delivery of case binders that were selected for post-endorsement review, the ML explains.

“The FHA Catalyst: Case Binder Module now includes an ‘LRS’ submission type to allow delivery of case binders for post-endorsement review in LRS,” the ML reads. Mortgagees who have not received their credentials to log into Catalyst and submit case binders electronically must do so by directly contacting the FHA Resource Center.

Mortgagees that have not been approved for electronic case binder submission through FHA Connection must now use the case binder module in Catalyst to submit forward and reverse mortgage case binders which have been requested for an LRS post-endorsement review, the ML instructs.

The U.S. Department of Housing and Urban Development (HUD)’s Homeownership Centers (HOCs) have seen notable increases in reverse mortgage volume since the onset of the COVID-19 coronavirus pandemic, though physical case binders for HECM endorsements continue to pile up in empty offices despite the ability for binders to be submitted digitally, according to HUD officials earlier this summer.

Additionally, though HECM makes up only a minority of total users on the FHA Catalyst platform, the HECM side of the mortgage business is actually quite over-represented in terms of endorsement volume that is processed through Catalyst, according to the director of the Denver HOC in July.

Read ML 2020-29 at HUD.