The following report is an overview of SunTrust’s progress under the National Mortgage Settlement (NMS or Settlement).

This report includes a review of SunTrust’s compliance with the Settlement’s servicing standards for the second half of 2017.

I have reviewed SunTrust’s internal review group’s (IRG) compliance metric testing results and concluded that SunTrust did not fail any of the compliance metrics I tested for the third and fourth quarters of 2017. I have also determined, based on further work that I required SunTrust to undertake, that SunTrust has completed the remediation of borrower harm caused by the failure of Metric 4 in each of the four quarters of 2016.

I will continue to monitor and report on SunTrust’s compliance with the servicing standards.

To evaluate SunTrust, I work with a team of professionals. SunTrust followed a work plan in which the IRG determined whether the servicer complied with the Settlement terms. My professionals and I then reviewed the work of the IRG. I determined that the IRG’s work was satisfactory and reported my findings to the Court and the public. For more information about the oversight and review process, please see my previous reports.

Sincerely,

Joseph A. Smith, Jr.

I evaluated SunTrust’s compliance with the Settlement’s servicing standards using the 34 metrics, or tests, enumerated in the Settlement. These metrics determine whether SunTrust adhered to the 304 servicing standards, or rules, contained in the NMS.

The work to test SunTrust in the third and fourth quarters of 2017 involved 35 professionals, including my primary professional firm, secondary professional firm and other professionals who dedicated approximately 16,310 hours.

This report covers the third and fourth quarters of 2017, and I tested SunTrust on up to 31 metrics in these quarters.

The NMS defines a failed metric as a potential violation and gives the servicer a chance to fix the root causes of its failure. For more information on what happens when a servicer fails a metric, see the graphic in the Appendix. I also included information on metric fails and corrective action plans (CAPs) in my previous reports.

Neither SunTrust’s IRG nor my professionals found evidence of fails for any of the metrics tested in the third and fourth quarters of 2017.

Metric 4

This metric tests the accuracy of information on Proof of Claims (POCs) filed in Bankruptcy Court. As I noted in prior reports, I rejected SunTrust’s test results for Metric 4 in the fourth quarter of 2015 and all four quarters of 2016 because SunTrust had changed official Bankruptcy Form 410A (the Mortgage Proof of Claim Attachment) to provide information differently than contemplated by the official form.

I required SunTrust to perform an analysis of all POCs filed from December 2015 through March 2017 to correct the Form 410A and to determine whether there were differences in the original incorrectly prepared form and the corrected form. The results
of this analysis showed that SunTrust had exceeded the Threshold Error Rate for Metric 4 in all four calendar quarters of 2016, and that the failure was widespread in each of those quarters.

As noted in my prior report, I confirmed that SunTrust passed Metric 4 during the cure period, which was the second quarter of 2017.

Remediation
Because the failure was widespread, I required SunTrust to file amended POCs in all active bankruptcies where the errors on the original, incorrectly prepared forms were greater than $1. In addition, required SunTrust to make refunds to borrowers from whom SunTrust had collected more than the borrower actually owed based on the incorrect forms. Finally, for those borrowers who were no longer active in bankruptcy, I required SunTrust to mail letters to the borrowers and the bankruptcy Trustees informing them of the errors in the original forms and providing the borrowers the opportunity to contact SunTrust if the borrower suffered any damage as a result of the errors.

SunTrust submitted its proposed Remediation Plan in November 2017. My professionals and I reviewed, and I approved SunTrust’s Remediation Plan, and SunTrust satisfactorily implemented the remediation. My professionals and I reviewed and determined that SunTrust’s remediation was completed in May 2018.

SunTrust continues to make progress under the NMS. I will continue to monitor SunTrust’s compliance with the Servicing Standards and will report on my review of the final testing period (the first quarter of 2018) to the Court and the public later this year.