Chapter 5

Purchase

Section 501

Generally
501.01

Cash and MBS

Requirements

Before Fannie Mae purchases an MBS Mortgage Loan MBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. or a Cash Mortgage Loan Cash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. per the Commitment CommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. , you must ensure

  • the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. complies with Part IV, and
  • an MBS Mortgage Loan MBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. complies with all disclosure requirements.
501.02

Delivery and Purchase

Requirements

You must deliver the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. by the Delivery DeliverySubmission of all correct, accurate, and certifiable documents, data, and information with all applicable documents properly completed, executed, and recorded as needed, and any deficiencies resolved to Fannie Mae’s satisfaction. deadline to ensure sufficient time for Fannie Mae to review the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. data and Mortgage Loan Delivery Package Mortgage Loan Delivery PackageLoan Documents and underwriting material required in connection with the Delivery of a Mortgage Loan. for purchase.

Operating Procedures

Loan Type Fannie Mae will...
MBS Mortgage Loan Purchase the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. on the Book-Entry Date Book-Entry DateDate a Security is delivered by Fannie Mae via the Federal Reserve book-entry system to the applicable Investor’s designated book-entry account at a depository institution. by wiring the MBS MBSMortgage-Backed Security via the Federal Reserve book-entry system per the wiring instructions you submitted in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. .
Cash Mortgage Loan
  • Purchase the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. 48 hours after certifying it.
  • Wire the purchase amount per the wiring instructions you submitted in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. .
  • Disburse funds per this Chapter and the payee codes you submitted in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. (see  Part IV, Chapter 4: Delivery, Section 404.02: Wiring Payee Codes ).
  • Issue a detailed electronic purchase advice for each Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. listing components of the net disbursement, including
    • purchased principal,
    • any accrued interest,
    • prepaid interest, or
    • returned fees.
  • Assume no responsibility or liability for disbursing any other funds.

Guidance

For a Cash Mortgage Loan Cash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. , you may request that Fannie Mae purchase the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. before the Commitment CommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. expiration date by

  • selecting the Targeted Funding Date option in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. , and
  • ensuring Fannie Mae receives the complete Delivery DeliverySubmission of all correct, accurate, and certifiable documents, data, and information with all applicable documents properly completed, executed, and recorded as needed, and any deficiencies resolved to Fannie Mae’s satisfaction. 3 Business Days Business DaysAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. before (and not including) the requested purchase date.
501.03

C&D Purchase Notification

Operating Procedures

After Fannie Mae acquires the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. , you will see the status in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. of

  • “Funded” for a Cash Mortgage Loan Cash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. , or
  • “Active/Issued” for an MBS Mortgage Loan MBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. .
501.04

Fannie Mae Loan Number

Requirements

You must reference the Loan Number Loan Number10-digit number assigned by Fannie Mae to each Mortgage Loan. in all communications with Fannie Mae about the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. .

Operating Procedures

You will receive the Loan Number Loan Number10-digit number assigned by Fannie Mae to each Mortgage Loan. through C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. after

  • Fannie Mae closes the MBS Pool MBS PoolMBS Security backed by MBS Mortgage Loans. for an MBS Mortgage Loan MBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. , or
  • you submit the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. data for a Cash Mortgage Loan Cash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. .
Section 502

Purchase Amount

Operating Procedures

For a Cash Mortgage Loan Cash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. , the purchase amount will be based on

  • the price (expressed as a percentage) per the Commitment CommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. ,
  • multiplied by the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. UPB UPBUnpaid Principal Balance at purchase, and
  • adding any accrued interest or deducting any prepaid interest, calculated based on the purchase date, to reflect your and Fannie Mae’s respective shares.

For an MBS Mortgage Loan MBS Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. ,

  • Fannie Mae will wire the MBS MBSMortgage-Backed Security Security SecurityMBS, PFP MBS, or REMIC. in its face amount, and
  • you will coordinate with your MBS Investor MBS InvestorFor MBS Mortgage Loans, either a Third Party MBS Investor for Lender-Arranged Sales, or the Multifamily Trading Desk. to determine any interest-related adjustments to the settlement proceeds due on the Book-Entry Date Book-Entry DateDate a Security is delivered by Fannie Mae via the Federal Reserve book-entry system to the applicable Investor’s designated book-entry account at a depository institution. .
Section 503

Third Party MBS Investor Delivery Scenarios

Operating Procedures

Delivery to... Under this scenario...
You or Your Designee
  • Fannie Mae will deliver the MBS MBSMortgage-Backed Security directly to your account or to your designee through the Federal Reserve book-entry system.
  • You or your designee will deliver the MBS MBSMortgage-Backed Security to the Third Party MBS Investor Third Party MBS InvestorMBS Investor for an MBS Mortgage Loan that is not the Multifamily Trading Desk. through the Federal Reserve book-entry system.  The Federal Reserve simultaneously will
    • credit the Third Party MBS Investor’s Third Party MBS Investor’sMBS Investor for an MBS Mortgage Loan that is not the Multifamily Trading Desk. account with the MBS MBSMortgage-Backed Security ,
    • debit the Third Party MBS Investor’s Third Party MBS Investor’sMBS Investor for an MBS Mortgage Loan that is not the Multifamily Trading Desk. account for the purchase amount, and
    • credit your account for the purchase amount.
Third Party MBS Investor
  • Fannie Mae will deliver the MBS MBSMortgage-Backed Security directly to the Third Party MBS Investor’s Third Party MBS Investor’sMBS Investor for an MBS Mortgage Loan that is not the Multifamily Trading Desk. account per your delivery instructions.
  • When the Third Party MBS Investor Third Party MBS InvestorMBS Investor for an MBS Mortgage Loan that is not the Multifamily Trading Desk. receives the MBS MBSMortgage-Backed Security , it will wire payment to you per the agreed-upon terms.
Section 504

MBS Mortgage Loan Disclosure
504.01

Multifamily MBS Prospectus

Guidance

For all MBS MBSMortgage-Backed Security , Fannie Mae issues a Multifamily MBS Prospectus containing information for MBS MBSMortgage-Backed Security Investors InvestorsMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. , including:

  • a general description of Fannie Mae’s multifamily mortgage business;
  • disclosure of general MBS MBSMortgage-Backed Security risk factors;
  • property types securing multifamily mortgage loans; and
  • specific Security SecurityMBS, PFP MBS, or REMIC. , Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. , and Property PropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). disclosure data.

Since different characteristics may affect the performance assumptions and risk factors associated with an MBS MBSMortgage-Backed Security , Fannie Mae uses Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. to inform all MBS MBSMortgage-Backed Security Investors InvestorsMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. if any MBS Mortgage Loans MBS Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. have characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus.

You may access Multifamily MBS Prospectus documents at https://multifamily.fanniemae.com.

For MBS MBSMortgage-Backed Security issued prior to December 2017, Fannie Mae prepared a Prospectus Supplement containing specific Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. information in addition to the Multifamily MBS Prospectus.  This Prospectus Supplement had 2 parts:

  • The Prospectus Supplement Narrative (standard) was a transaction-specific disclosure describing the terms and structure of the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. .
  • The Schedule of Pool and Loan Information, including:
    • Pool Statistics, providing Security SecurityMBS, PFP MBS, or REMIC. -level disclosure data; and
    • Multifamily Schedule of Loan Information, including specific Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. and Property PropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). disclosure data.
504.02

Additional Disclosure

Requirements

Before obtaining a Rate Lock Rate LockAgreement between you and the Investor containing the terms of the Lender-Arranged Sale or Multifamily Trading Desk trade of the Mortgage Loan and the MBS terms and conditions relating to the underlying MBS, if applicable, which may be documented via a recorded telephone conversation. , you must disclose whether the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. requires Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. (per  Form 4098 ) to Fannie Mae and to any MBS Investor MBS InvestorFor MBS Mortgage Loans, either a Third Party MBS Investor for Lender-Arranged Sales, or the Multifamily Trading Desk. using the Multifamily Required Trade Information for Cash or MBS Mortgage Loans MBS Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for an issued MBS backed by the Mortgage Loan. ( Form 4097 ).

Operating Procedures

If you identify Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. features on Form 4097 , you must also

  • mark the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. for Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. ,
  • provide detailed information about the Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. , and
  • consult with the Fannie Mae Deal Team Fannie Mae Deal TeamTeam responsible for reviewing Pre-Review Mortgage Loans, waivers, etc. .

Guidance

For all Mortgage Loans Mortgage LoansMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. marked for Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. in C&D C&DElectronic committing and delivery system used for issuing and confirming Commitments for acquiring Mortgage Loans, or any such successor system. , Fannie Mae will review the Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. and data submitted and determine

  • if Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. is required, and
  • the final disclosure language.
If Fannie Mae determines Additional Disclosure is... Fannie Mae will issue...
Not required The standard Multifamily MBS Prospectus.
Required

Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. , and may use information you provided in

 

  • an Addendum to the Multifamily MBS Prospectus, or
  • a footnote on the Annex A.

Fannie Mae will post the Multifamily MBS Prospectus on DUS Disclose DUS DiscloseMultifamily system providing disclosure to Investors on a multifamily Security, or any successor systems. at least 2 Business Days Business DaysAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. before the MBS MBSMortgage-Backed Security Book-Entry Date Book-Entry DateDate a Security is delivered by Fannie Mae via the Federal Reserve book-entry system to the applicable Investor’s designated book-entry account at a depository institution. .

504.03

Disclosure Obligations

Requirements

You must ensure that all information in the Multifamily MBS Prospectus, including any Additional Disclosure Addendum or footnote to Annex A, is complete and accurate.

Operating Procedures

You must:

  • Review the Multifamily MBS Prospectus, including any applicable Additional Disclosure Additional DisclosureInformation you provide that is published as an addendum to the disclosure documents when an MBS is issued and describes special Security, Mortgage Loan, or Property characteristics or terms that differ from those described in the standard Multifamily MBS Prospectus. in any Addendum to the Prospectus and/or footnote to the Annex A.
  • Notify Fannie Mae of any inaccuracies before the Book-Entry Date Book-Entry DateDate a Security is delivered by Fannie Mae via the Federal Reserve book-entry system to the applicable Investor’s designated book-entry account at a depository institution. .
  • Certify to the completeness of the Multifamily MBS Prospectus Fannie Mae issues.
  • Comply with all
    • applicable federal and state securities laws, and
    • rules and guidelines of the Securities SecuritiesMBS, PFP MBS, or REMIC. Industry and Financial Markets Association.
Section 505

ASAP

Requirements

If the Mortgage Loan Mortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or  a mortgage debt obligation with a Fannie Mae credit enhancement. is funded under an ASAP Option ASAP OptionASAP Sale and ASAP Plus (including ASAP Plus POC) purchase options per Part IV, Chapter 2: Rate Lock and Committing, Section 205: ASAP Options. , you must comply with the ASAP Contract ASAP ContractASAP Sale Contract, ASAP Plus Contract, and ASAP Plus POC Contract. .