Section 308

Recordkeeping and Reconciliations

308.01

Account Analysis and Reconciliation

Requirements

You must analyze and reconcile each Custodial AccountCustodial AccountAccounts established by the Servicer for depositing P&I payments, T&I funds, Collateral Agreement deposits, and other similar funds. and associated Clearing AccountsClearing AccountsLender account at an Eligible Depository used either for receiving funds for various loans and for the benefit of multiple investors, and from which segregated funds are transferred to specific Custodial Accounts held solely for the benefit of Fannie Mae, or disbursing funds after transfer… monthly.

Operating Procedures

At a minimum, your reconciliation must include:

  • a depository reconciliation;
  • the cashbook balance composition; and
  • an explanation of line items.

Fannie Mae may review your reconciliation including:

  • an explanation of any adjustments you made;
  • the specific cashbook balances; and
  • any individual components.

While Fannie Mae does not prescribe a recordkeeping method to generate a cashbook balance, you must:

  • maintain the integrity of the Custodial AccountCustodial AccountAccounts established by the Servicer for depositing P&I payments, T&I funds, Collateral Agreement deposits, and other similar funds. balances reported on your reconciliations;
  • be able to substantiate each cashbook component; and
  • retain sufficient detail to perform the following cashbook computation:
Function Beginning Cashbook Balance
+ Receipts
- Disbursements
+/- Cashbook Adjustments
= Ending Cashbook Balance
308.02

Records

Operating Procedures

You must maintain adequate documentation supporting the Borrower'sBorrower'sPerson who is the obligor per the Note. payment records, including Clearing AccountClearing AccountLender account at an Eligible Depository used either for receiving funds for various loans and for the benefit of multiple investors, and from which segregated funds are transferred to specific Custodial Accounts held solely for the benefit of Fannie Mae, or disbursing funds after transfer… credits and charges.

308.03

For T&I Custodial Accounts

Requirements

You must maintain and administer all BorrowerBorrowerPerson who is the obligor per the Note. funds held in a T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. on an individual Mortgage LoanMortgage 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. basis.

Operating Procedures

At a minimum, for each Mortgage LoanMortgage 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. in a T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. , you must account for:

  • T&I ImpositionT&I ImpositionAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. payment deadlines and amounts funded from the account;
  • monthly funds due for deposit;
  • funds received and deposited;
  • withdrawals; and
  • amounts you advance for T&I ImpositionsT&I ImpositionsAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. .
308.04

Borrower's T&I Impositions and Custodial Accounts
308.04A

Analysis Timing

Operating Procedures

You must:

  • Analyze your T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. records:
    • annually for each Mortgage LoanMortgage 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
    • when a material change occurs in a Borrower'sBorrower'sPerson who is the obligor per the Note. T&I ImpositionsT&I ImpositionsAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. .
  • Determine if the Borrower'sBorrower'sPerson who is the obligor per the Note. T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. funds, plus the Borrower'sBorrower'sPerson who is the obligor per the Note. required monthly deposits, are sufficient to timely pay all upcoming T&I ImpositionsT&I ImpositionsAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. .
308.04B

Insufficient Funds

Operating Procedures

If the Borrower'sBorrower'sPerson who is the obligor per the Note. T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. funds are insufficient to timely pay all T&I ImpositionsT&I ImpositionsAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. , you must

  • bill the BorrowerBorrowerPerson who is the obligor per the Note. for any shortage, and/or
  • increase the Borrower'sBorrower'sPerson who is the obligor per the Note. monthly T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. deposit.

After adjusting the Borrower'sBorrower'sPerson who is the obligor per the Note. future deposits, you may use those funds for a shortfall in either taxes or insurance.

308.04C

Surplus

Requirements

You must not maintain a surplus of more than 2 monthly T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. payments in the T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. .

Operating Procedures

If the T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. has a surplus of more than 2 monthly T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. payments, you must:

  • refund the BorrowerBorrowerPerson who is the obligor per the Note. the amount of the surplus above the 2 monthly T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. payments; or
  • reduce the Borrower'sBorrower'sPerson who is the obligor per the Note. required monthly T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. deposit to reduce the surplus to no more than 2 monthly T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. payments within 12 months.

You cannot refund any T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. surplus if the BorrowerBorrowerPerson who is the obligor per the Note. or any other party has defaulted under any of the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. beyond any grace or cure period.

308.05

Annual Statements

Operating Procedures

By January 31st of each year, you must issue the BorrowerBorrowerPerson who is the obligor per the Note. a T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. statement reporting all activity during the preceding calendar year.  You can provide this statement

  • in writing, or
  • via electronic access.

Guidance

Your annual T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. statement must include:

  • Borrower'sBorrower'sPerson who is the obligor per the Note. fund balance at the beginning of the year;
  • total BorrowerBorrowerPerson who is the obligor per the Note. deposits into the account;
  • total withdrawals you made;
  • itemized list of specific T&I ImpositionsT&I ImpositionsAmounts for taxes, insurance, and other charges assessed against or owing on the Property which you deem necessary to protect the Property and/or prevent Liens imposed on it. and other charges (e.g., real estate taxes, insurance premiums, etc.) you paid with the withdrawals;
  • Borrower'sBorrower'sPerson who is the obligor per the Note. fund balance at the end of the year; and
  • amount of interest, if any, paid or credited to the BorrowerBorrowerPerson who is the obligor per the Note. on their funds.