VA: Circular 26-18-3: Acceptance of Properties

VA: Circular 26-18-3: Acceptance of Properties

VA: Circular 26-18-3: Acceptance of Properties

Updated 4/20/20: Extended rescission date of the original circular.

Circular 26-18-3 (Change 1)

Investor Update
February 23, 2018

Source: VA

1. Purpose. This Circular provides guidance on requests for execution of documents related to the conveyance or reconveyance of properties to the Secretary of the Department of Veterans Affairs (VA) to provide specific details to those authorized to sign documents for the Secretary, and to those who submit such documents.

2. Background. Conveyance of properties to the Secretary is addressed in Title 38, Code of Federal Regulations (CFR), section 36.4323, titled “Election to Convey Security”. This section discusses the conditions in which a loan servicer that acquires a property which secured a VAguaranteed loan at a liquidation sale, via foreclosure or through acceptance of a deed-in-lieu of
foreclosure, may decide to transfer the property to the Secretary. The regulation provides that the conveyance is subject to a number of provisions, particularly that the servicer will convey the title to the Secretary via a special warranty deed and must provide evidence to the Secretary of acceptability of title (which need not be provided if transfer is via a general warranty deed). The fact that the VA Loan Electronic Reporting Interface (VALERI) accepts the Transfer of Custody (TOC) event to report the notice of election to convey, this does not mean the Secretary has actually accepted conveyance of the property until all provisions of 38 CFR 36.4323 are satisfied.

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