Mortgage Compliance News: 2010 Fannie Mae Lender Announcement

2010 Fannie Mae Lender Announcement | MCA

2010 Fannie Mae Lender Announcements and Letters

SEL-2010-17: Updated Flow Business Pricing Requirements

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  • Summarizes the updated and new loan-level price adjustments (LLPAs).

SVC-2010-18: Technology Fees and Foreclosure and Bankruptcy Referrals

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  • Amends servicing requirements regarding technology usage and electronic invoice submission charges to attorneys and trustees and foreclosure and bankruptcy referrals.

Notice, dated 12/17/10: Broker Price Opinion Providers and Pricing Structure

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  • Notifies servicers of four new Broker Price Opinion (BPO) providers
  • Clarifies that, effective February 1, 2011, servicers must diversify referrals among two or more BPO providers
  • Announces new reimbursement rates

Notice, dated 12/17/10: Reminder of Duties Regarding Confidentiality of Fannie Mae Mortgage Files and Borrower Payment Records

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  • Reminds servicers of duty to ensure security, integrity, and confidentiality of borrower, property, and other information related to loan.

LL-2010-15: Uniform Appraisal Dataset and Uniform Collateral Data Portal

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  • Gives overview of:
    • Uniform Appraisal Dataset requirements
    • Uniform Collateral Data Portal
    • Future updates to Fannie Mae policies

Notice, dated 12/15/10: Co-op Share Loan Documentation and Requirements for Document Custodians Update

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  • Updates state-specific requirements for co-op share loans, such as which documents must be delivered to document custodian. Updates Connecticut requirements and adds Alaska, Indiana, and Washington.

SEL-2010-16: Selling Guide Updates

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  • Updates Selling Guide, including:
    • Project eligibility requirements and resources
    • Income documentation
    • Community HomeChoice, Community Solutions, and MyCommunityMortgage
    • PACE loan programs
    • Misc. updates

SEL-2010-15: New Energy Improvement Feature and Other Related Updates

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  • Announces new energy improvement feature as standard offering available to all lenders, as well as other related updates.

Notice, dated 12/1/10: Revision in Process Requirements for Mandatory Pre-filing Mediation Policy for Mortgage Loans in Florida

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  • To manage Florida pre-filing mediation, all parties must use Clarifire application.

SVC-2010-17: Miscellaneous Servicing Policy Changes

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  • Updates and clarifies several policies, including:
    • Unique hardships policy for problem drywall
    • Termination of option to submit manually prepared reports
    • Delivery of repurchased loans

LL-2010-14: State Farm Florida Insurance

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  • Announces that Fannie Mae will continue to accept hazard insurance coverage from State Farm Florida Insurance, retroactive to 8/3/10.

LL-2010-13: Confirmation of Conventional Loan Limits for 2011

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  • Announces 2011 conventional loan limits

Notice, dated 11/10/10: Termination of Relationship with the Stern Law Firm

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  • Florida: Announces that servicers may not refer any future Fannie Mae matters to the Law Offices of David J. Stern, P.A. (the "Stern Firm").

LL-2010-12: Making Home Affordable: Interactions with Hardest-Hit Fund Unemployment and Reinstatement Programs

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  • Provides guidance to servicers for interactions with Hardest Hit Fund Unemployment and Reinstatement Programs.

SVC-2010-16: Miscellaneous Servicing Policy Changes

See announcement on

  • Announces misc. servicing policy changes, including:
    • Retirement of Payment Reduction Plan
    • Clarification of mandatory pre-filing mediation policy for mortgage loans in Florida
    • Waiver of escrow deposit accounts
    • Flood insurance requirements
    • Submissions of underwriting and servicing review files


Appraiser Independence Requirements

  • Announces Appraiser Independence Requirements, which replace HVCC. Effective immediately.


Servicer Review of Procedures Relating to the Execution of Affidavits, Verifications, and Other Legal Documents

  • Directs all servicers to immediately review policies related to execution of affidavits, verifications, and other legal documents connected with default process.


Extension to Fannie Mae's Alternative Modification to the Home Affordable Modification Program

  • Extends timeframe to November 30, 2010 for servicers to submit their Alt Mod cases.


Updates to Fannie Mae’s Forbearance, Income Eligibility, and Home Affordable Modification Program Requirements

  • Updates servicing guide regarding forbearance, income eligibility, and HAMP requirements.


Home Affordable Modification Program: Introduction of Second Lien Modification Program

  • Provides guidance on Second Lien Modification Program (2MP), which is designed to work in tandem with HAMP. Servicers must implement no later than January 1, 2011.


Selling Guide Updates

  • Updates selling guide regarding simplified high LTV ratio transactions, updated employment and income policies, etc.

Notice, dated 9/17/2010

New Appraiser Independence Requirements Being Developed

  • Fannie Mae is working with FHFA to develop and adopt appraiser independence requirements that will replace HVCC.


Suspension of California Housing Loan Insurance Fund

  • Fannie Mae suspends California Housing Loan Insurance Fund (CaHLIF) as an approved mortgage insurer.


Mandatory Pre-filing Mediation Policy for Mortgage Loans in Florida

  • Announces that servicers must assign delinquent Florida mortgages to a FNMA attorney for mediation before initiating foreclosure proceedings.


Foreclosure Time Frames and Compensatory Fees for Breach of Servicing Obligations

  • Revises foreclosure time frames for FL, MD, NV, and NY. Fannie Mae also reserves right to impose compensatory fees for breach of servicing obligations.


Options for Borrowers with a PACE Loan

  • Announces new requirements for lenders regarding borrowers who got PACE loans before July 6, 2010.


Unique Hardships

  • Identifies "Unique Hardships" that warrant use of relief provisions for borrowers impacted by unusual circumstances that create financial hardship.


Undisclosed Liabilities and Re-underwriting Requirements

  • Updates requirements for undisclosed liabilities and re-underwriting. (Also clarifies that lender is not required to obtain a new credit report to verify additional debt.)


Selling Guide Updates

  • Updates the Selling Guide regarding the following topics:
    • Mortgage loans secured by properties subject to unexpired redemption periods
    • Delivery of repurchased loans
    • General warranty of project eligibility
    • Seasoned mortgage loan requirements
    • Co-op share loan documentation
    • Termination of inactive document custodians
    • Title Insurance ALTA Endorsement 21-06
    • Miscellaneous Selling Guide updates


Miscellaneous Servicing Policy Changes

  • Describes updates, clarifications and reminders to several servicing policies, including retirement of HomeSaver Advance, etc.


Reporting and Validation of Mortgage Insurance Coverage

  • On or before October 1, 2010, seller/servicers must instruct mortgage insurers (in writing) to provide Fannie Mae with information concerning its loans.

Notice, dated 7/27/10

Area Median Incomes 2010

  • Announces that Area Median Incomes (AMIs) will be available on Fannie Mae's website no later than August 23, 2010.
  • Lenders must use AMIs from to determine borrower eligibility for MyCommunityMortgage (MCM) loans.


Selling Guide Updates and Additional Guidance on Appraisal-Related Policies

  • Describes the following:
    • Appraisal-related policies that update the Selling Guide
      • Inclusion of interior photographs in the appraisal report
      • Lender changes to the appraised value and guidance on addressing appraisal deficiencies
      • Appraiser selection criteria
      • Sources of comparable market data
      • Selection of comparable sales
      • Communication under the HVCC
      • Seller concessions
      • Treatment of personal property
      • Market Conditions Addendum to the Appraisal Report (Form 1004MC)
    • Miscellaneous appraisal-related guidance (no impact on the Selling Guide)
    • Miscellaneous Selling Guide updates
    • Updates to Special Feature Codes
    • Updates to Mortgage Insurance Codes


Updates to the Requirements for Evaluating Borrowers for Fannie Mae's Standard Mortgage Modification

  • " Effective for all standard Fannie Mae mortgage loan modification solicitation offers on or after July 15, 2010, servicers must verify income, liabilities, and monthly expenses for all borrowers prior to granting a permanent standard Fannie Mae mortgage modification."


Underwriting Borrowers with a Prior Foreclosure

  • Removes 5 year option for borrowers with prior foreclosure, so that all borrowers must meet 7 year waiting period. Also updates eligibility requirements for borrowers with extenuating circumstances.


Selling Loans during Lapse of National Flood Insurance Program Authority

  • Under certain conditions, Fannie Mae will purchase mortgage loans secured by properties located in Special Flood Hazard Areas that do not have an active flood insurance policy.

Notice, dated 6/14/10

Extension of HOPE NOW Alliance Borrower Counseling Reimbursement

  • Servicers may request reimbursement for HOPE NOW Alliance counseled cases that were initiated on and after 7/1/10 through 6/30/11.


Extension to Fannie Mae's Alternative Modification to the Home Affordable Modification Program

  • Extends eligibility timeline in LL-2010-04 and clarifies certain requirements for participation in Alt Mod program.


Introduction of Fannie Mae's Home Affordable Foreclosure Alternatives Program

  • Introduces Home Affordable Foreclosure Alternatives Program, which simplifies use of short sales and DIL options.


Selling Guide Updates

  • Updates mortgage insurance clarifications, Community Seconds eligibility, title exceptions, etc.

Notice, dated 5/24/10

2010 Servicing Guide Part VIII — Updated Reference to Foreclosure Time Frames

  • Modifies reference to foreclosure time frames in previous announcement.


Property Assessed Clean Energy Loans

  • Property Assessed Clean Energy (PACE) loans "generally have automatic first lien priority over previously recorded mortgages. The terms of the Fannie Mae/Freddie Mac Uniform Security Instruments prohibit loans that have senior lien status to a mortgage…"


Selling Guide Updates

  • Updates Selling Guide for ARM qualifying rate, interest-only eligibility requirements, etc.


April 2010 Servicing Guide Update…

  • Updates two sections of the Servicing Guide: Part VII "Delinquency Management…" and Part VIII "Foreclosures…"


Underwriting Borrowers with a Prior Preforeclosure Sale or Deed-in-Lieu of Foreclosure

  • Adjusts underwriting criteria for borrowers who have experienced a "preforeclosure event." Reduces waiting period.


Selling Loans during Lapse of National Flood Insurance Program Authority

  • During lapse of NFIP, Fannie Mae will purchase loans in Special Flood Hazard Areas without flood insurance, under certain conditions.


Miscellaneous Servicing Policy Changes

  • Makes various updates and clarifications to several servicing policies.


Selling Guide Updates

  • Makes a variety of updates to Selling Guide.


Selling Guide Updates for Lender Quality Control Standards

  • Revises Selling Guide to update QC standards.


Fannie Mae’s Alternative Modification to the Home Affordable Modification Program

  • Introduces "Alt Mod"—an alternative to HAMP modification for borrowers who were accepted into HAMP trial period but were not eligible for a HAMP permanent modification.


Reclassified MBS Mortgage Loans

  • Reclassifies HAMP Program MBS Mortgage loans, expedites reimbursements of servicer advances, etc.

Notice, dated 3/2/10

Extension of the Home Affordable Refinance Program

  • FHFA extends HARP to 6/30/11.


Selling Guide Updates

  • Announces that Selling Guide has been updated to incorporate several miscellaneous clarifications or omissions.


Selling Guide Updates for the Loan Quality Initiative

  • Describes some changes impacting Selling Guide as result of Loan Quality Initiative (LQI). Many changes effective 6/1/10.


An Introduction to Fannie Mae's Loan Quality Initiative

  • Introduces Loan Quality Initiative–Several policy changes to be announced over next few months.


New Fannie Mae-Approved Mortgage Insurers

  • Announces four new mortgage insurers.


Home Affordable Modification Program – Program Update and Resolution of Active Trial Modifications

  • Amends key features of HAMP, such as requiring full verification of borrower eligibility prior to offering trial period plan.


Update to Imminent Default Guidance for Mortgage Loans Evaluated for the Home Affordable Modification Program

  • Introduces Imminent Default Indicator, requires use of verified income documentation before entering borrower in trial period plan, etc.


Trial Balance Reconciliation Requirements for Reverse Mortgage Loans

  • Updates reporting and reconciliation requirements for reverse mortgages. Also sets fines for non-compliance of reporting.


Special Approval Designation for Established Florida Condominium Projects

  • Implements a new "Special Approval" designation for condo projects in Florida.

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