Primary Changes

• Updated Part II, Chapter 3: Legal Compliance to increase delegation and clarify underwriting requirements when affected Improvements cannot, in the case of full or partial casualty or condemnation, be rebuilt to their pre-casualty condition per current zoning requirements and building codes.
• Added a new Loan Document, Limited Payment Guaranty (Form 6020.LPG), that you may consider requiring the Borrower to execute for a Tier 3 or Tier 4 Mortgage Loan at origination, to mitigate the risk of the as-rebuilt Property not supporting a Tier 2 Mortgage Loan.
• For all Properties, updated the Title Insurance guidance to clarify:
  • title coverage must be in effect the date you fund the Mortgage Loan; and
  • the issued title insurance policy should be later-dated to cover the Assignment of Security Interest’s recording date.

Questions

Please contact the Fannie Mae Deal Team with any questions.