10.03 TRANSFER OF CUSTODY EVENT REPORTING (05/09/17)

© VA Servicers Handbook - M26-4

a. If the servicer chooses to transfer custody of the property, they must report the TOC event to VA within 15 days of loan termination. Loan termination is defined as:

1. Foreclosure. The date of legal termination as defined under state law.

2. DIL. The date the deed is recorded or the date the deed is sent for recordation.

b. When a loan is terminated in a confirmation/ratification state, the servicer must provide the date of confirmation/ratification in the TOC event. The servicer is also responsible for providing all insurance and property tax information, including all taxing authority property identification numbers. It is important to note that the holder of the loan must pay any taxes, special assessments, or ground rents due within 30 days after the date of transfer of custody to VA.

c. In states that require a confirmation of sale, there could be lengthy delays between the foreclosure sale and confirmation. In such cases, if the servicer plans to convey the property to VA, VA may require the servicer to order a new VA appraisal at the servicer's expense and provide a copy of the most recent property inspection completed.

d. Each TOC submitted in VALERI is evaluated against VA regulatory requirements. VALERI rejects the TOC event if any of the following conditions apply:

1. The loan is not guaranteed.

2. The loan is not terminated (i.e., the servicer did not report the appropriate event that identifies a loan termination in VALERI).

3. The successful bidder specified on the results of sale event was “third party.”

4. The servicer reports the TOC event 16 or more days from the date of loan termination.

e. Servicers can review the rejected TOC events on the Servicer Events Report Log Report.