Guide Update 21-11: Prepayment Premium Waivers
Effective August 30, 2021, the Prepayment Premium waiver requirements were updated in
- Part III, Chapter 18: Choice Refinance Loans, Section 1803: Prepayment Premiums: Requirements were clarified to align with the longstanding practice that you must not waive any:
- Prepayment Premium based on required yield maintenance; or
- portion of the Minimum 1% Prepayment Premium above the required yield maintenance if the Portfolio Mortgage Loan
- has a minimum Prepayment Premium other than 1%,
- will be refinanced before the Yield Maintenance Period End Date, or
- is a fixed rate MBS Mortgage Loan with an Issue Date before April 1, 1999.
- Part IV, Chapter 1: Pricing, Fees, and Prepayment Premiums: Reorganized and clarified to prohibit a Prepayment Premium waiver unless
- the Portfolio Mortgage Loan will be refinanced as a Choice Refinance Loan, and
- you comply with Part III, Chapter 18: Choice Refinance Loans, Section 1803: Payment Premiums.
Please contact the Multifamily Trading Desk with any questions.