A new requirement introduced by the LEAN program, but not required under the MAGP, is the use of deposit account agreements. These agreements, specifically known as Deposit Account Control Agreements (DACA) and Deposit Account Instructions Service Agreements (DAISA), are used to perfect a lender`s security interest in a trader`s current accounts and control their use. This requirement has delayed some LEAN closures, as these agreements must be pre-approved by the participating bank. Some Community banks have not been able or, in some cases, are not willing to enter into these agreements because they do not feel that they are able to facilitate blocked account agreements. In practice, some borrowers find themselves in an undesirable situation of having to change banks to meet this new requirement that inevitably delays the conclusion. In addition, in practice, we consider that a misunderstanding about the DACA and DAISA models provided by the HUD is inflexible, although these forms may vary as long as the elements required by the HUD are available. The debtor shall make available to the secured party a current account control agreement, duly entered into in the name of any financial institution that maintains a current account of the debtor in accordance with this security agreement. . While this warning discusses some of the pitfalls lenders face when participating in the LEAN HUD approval process, others await the unwary.

The Fund has entered into an account control agreement with each swap8 (”the Agreement”). ”I love the service. It is a great time saver, very practical, very relevant and very current. The best new legal resource I`ve come across in a long time. And it`s free! Please continue to make it available. Despite the program`s objectives, LEAN currently lacks consistency in application. HUD explains on its website that it has ”developed standardized checklists, performance certificates for third-party work, certifications and templates for lenders that they can use to compile the application package. In addition, it has developed standardized punchlists for HUD employees, who can use them when subscribing to submitted applications. ”HUD continues to work towards this goal. Lean still faces the challenge of inconsistency between HUD staff`s interpretation of document regulations and program requirements. As a result, the authorization process is inconsistent across HUD offices….