Fannie Mae Issues Numerous Servicing Guide Announcements

Fannie Mae Mortgage Servicing Servicing Guide

Over the past week, Fannie Mae has announced numerous servicing policy changes through a series of Servicing Guide Announcements. In SVC-2013-25, Fannie Mae updated allowable bankruptcy attorney and foreclosure attorney fees, as well as requirements for reimbursement of postage costs in connection with bankruptcies and foreclosures. SVC-2013-26 announced that servicers are no longer required to refer deed-in-lieu of foreclosure offers for Home Equity Conversion Mortgages (HECMs) to Fannie Mae for approval. Through SVC-2013-27, Fannie Mae updated its requirements for lender-placed insurance, including by (i) requiring that lender-placed insurance premiums charged to the borrower or reimbursed by Fannie Mae must exclude any lender-placed insurance commissions or payments earned by the servicer, broker, or any affiliated entity; (ii) requiring that a servicer’s carrier for a lender-placed insurance policy for a Fannie Mae mortgage loan must not be an affiliated entity of the servicer, which includes any captive insurance or reinsurance arrangements with an affiliated entity; and (iii) adding a new lender-placed insurance compliance certification. In SVC-2013-28, Fannie Mae expanded its standard and streamlined modification programs to include loans with a pre-modified mark-to-market loan-to-value ratio less than 80 percent. The announcement details steps servicers must take in order to determine the terms of a modified mortgage loan and ensure satisfaction of eligibility requirements. The announcement also establishes evaluation notice, solicitation letter, and trial period plan requirements for certain modifications. Finally, Fannie Mae issued SVC-2013-29 to announce that (i) all mortgage loans a master servicer transfers from one subservicer to another, from the master servicer to a subservicer, or from the subservicer to the master servicer, must obtain Fannie Mae’s prior written consent; and (ii) as part of the transfer of servicing review, Fannie Mae will evaluate the performance and capacity of any subservicer the transferee servicer elects to utilize.