Skip to content
Home
DUS Navigate®

Log In

Link
  • Print/Download Guide
HIDE MENU SHOW MENU
Part I
Mortgage Loan
  • Chapter 1
    Overview
    • Section 101
      Using the Guide
      • 101.01 Organization
      • 101.02 References
    • Section 102
      Delegation and Underwriting
    • Section 103
      Transaction Approval Memo
    • Section 104
      Representations
  • Chapter 2
    Mortgage Loan
    • Section 201
      Registration
    • Section 202
      Delegated Mortgage Loans
    • Section 203
      Pre-Review Mortgage Loans
    • Section 204
      Letters of Credit
      • 204.01 Generally
      • 204.02 Issuers and Ratings
      • 204.03 Verifying Issuer Ratings
      • 204.04 Restrictions on Issuer Collateral
      • 204.05 Drawing on Letter of Credit
  • Chapter 3
    Borrower, Guarantor, Key Principals, and Principals
    • Section 301
      Generally
    • Section 302
      Borrower Organizational Structure
      • 302.01 Single-Asset Entity
      • 302.02 Co-Tenant Borrowers
        • 302.02 A Tenancy-in-Common Agreement
        • 302.02 B Key Principal Execution of Guaranty
    • Section 303
      Key Principals, Principals, and Guarantors
      • 303.01 Entity Review
      • 303.02 Fund
    • Section 304
      Financial Statements
    • Section 305
      Multifamily Underwriting Certificate
    • Section 306
      Fraudulent Conveyance
    • Section 307
      Applicant Experience Check
    • Section 308
      Compliance
    • Section 309
      Execution of Non-Recourse Guaranty
    • Section 310
      Conflict Mortgage Loans
      • 310.01 Description
      • 310.02 Restrictions
        • 310.02 A Underwriting
        • 310.02 B Servicing
        • 310.02 C No First Right of Refusal
        • 310.02 D Additional Disclosure
        • 310.02 E Notifications
Part II
Property
  • Chapter 1
    Attributes and Characteristics
    • Section 101
      Generally
    • Section 102
      Multiple Parcels
    • Section 103
      Property Ownership; Leasehold
    • Section 104
      Ground Leased Properties
      • 104.01 Generally
      • 104.02 Ground Lease Rents
      • 104.03 Ground Lease Estoppel Certificate
      • 104.04 Ground Lease Review
    • Section 105
      Minimum Occupancy
      • 105.01 Residential Occupancy
      • 105.02 Qualified Occupants
    • Section 106
      Certificates of Occupancy
    • Section 107
      Phased Properties
    • Section 108
      Commercial Leases
      • 108.01 Material Commercial Leases
        • 108.01 A Lease Review
        • 108.01 B Lease Approval
        • 108.01 C Lease Modifications
        • 108.01 D Tenant Estoppel Certificate
        • 108.01 E Subordination, Non-Disturbance and Attornment
      • 108.02 Non-Material Commercial Leases
        • 108.02 A Tenant Estoppel Certificate; Lease Modification
        • 108.02 B Non-Material Commercial Lease Types
      • 108.03 Short Term Rentals
    • Section 109
      Renewable Energy Generation Systems
      • 109.01 Acceptable Renewable Energy Generation Systems
      • 109.02 Solar Photovoltaic Systems
      • 109.03 Solar PV System Module
      • 109.04 Underwritten NCF
    • Section 110
      Oil/Gas Wells and Mineral Exploration
      • 110.01 Active Oil and Gas Wells
      • 110.02 Inactive Oil and Gas Wells
    • Section 111
      Property Management and Agreement
      • 111.01 Property Management
      • 111.02 Property Management Agreement
  • Chapter 2
    Valuation and Income
    • Section 201
      Market and Valuation
      • 201.01 Market Analysis
      • 201.02 Appraisal
        • 201.02 A Appraiser Role and Qualifications
        • 201.02 B Valuation Date
        • 201.02 C Appraised Value
      • 201.03 Underwriting Value
    • Section 202
      Income Analysis
      • 202.01 Underwritten Net Cash Flow (Underwritten NCF)
      • 202.02 Underwritten DSCR
    • Section 203
      Refinance Risk Analysis
      • 203.01 Base Assumptions
      • 203.02 Alternative Assumptions
    • Section 204
      Cash Out Analysis
    • Section 205
      Rent-Stabilized Properties
  • Chapter 3
    Legal Compliance
    • Section 301
      Zoning and Legal Non-Conforming Uses
    • Section 302
      Easements
    • Section 303
      Liens and Encumbrances
      • 303.01 Generally
      • 303.02 Property Previously Secured Bond Financing
    • Section 304
      Title Insurance
      • 304.01 Title Insurance Company
      • 304.02 Policy Form
      • 304.03 Electronic Policies
      • 304.04 Insured
      • 304.05 Effective Date
      • 304.06 Survey Exception
      • 304.07 Exception for Taxes, Assessments, or Other Lienable Items
      • 304.08 Financing Statements
      • 304.09 Endorsements
        • 304.09 A Generally
        • 304.09 B Environmental Protection Lien Endorsement
        • 304.09 C Comprehensive Endorsement
      • 304.10 Document Retention
    • Section 305
      Survey
      • 305.01 Decision to Obtain a Survey
      • 305.02 Survey
      • 305.03 Decision Not to Obtain a Survey
      • 305.04 Location of Improvements
    • Section 306
      Security Interests in Personal Property
      • 306.01 Uniform Commercial Code (UCC) Financing Statements
      • 306.02 Creating and Perfecting the Security Interest
  • Chapter 4
    Inspections and Reserves
    • Section 401
      Site Inspection
    • Section 402
      Property Condition Assessment (PCA)
      • 402.01 When to Perform a PCA
      • 402.02 Date of PCA Report and PCA Site Visit
      • 402.03 Conducting the PCA
    • Section 403
      Completion/Repairs
      • 403.01 Property Evaluation
      • 403.02 Completion/Repairs Funding
      • 403.03 Life Safety Issues
      • 403.04 Verifying Completion/Repairs
    • Section 404
      Replacement Reserve
      • 404.01 Determining Replacement Reserve
      • 404.02 Replacement Reserve Funding
      • 404.03 Alternative Replacement Reserve Funding
    • Section 405
      Escrow Requirements for Taxes and Insurance
      • 405.01 Escrows
      • 405.02 Real Estate Tax Escrow Funding
      • 405.03 Insurance Escrow Funding
  • Chapter 5
    Property and Liability Insurance
    • Section 501
      Property and Liability Insurance
      • 501.01 General Insurance – Applies to All Policies
        • 501.01 A Generally
        • 501.01 B Blanket and Other Policies Covering Multiple Properties
        • 501.01 C Insurance Carrier Rating
        • 501.01 D Term
        • 501.01 E Payment of Premium
        • 501.01 F Evidence of Insurance
        • 501.01 G Insurance Compliance and Data
        • 501.01 H Post Closing Insurance Exceptions
      • 501.02 Property Insurance
        • 501.02 A Minimum Coverage Amounts
        • 501.02 B Business Income (including Rental Value) Insurance
        • 501.02 C Ordinance or Law Insurance
        • 501.02 D Boiler and Machinery / Equipment / Mechanical Breakdown Insurance
        • 501.02 E Builder’s Risk Insurance
        • 501.02 F Fidelity Bond / Crime Insurance
        • 501.02 G Regional Perils Insurance
      • 501.03 Catastrophic Risk Insurance
        • 501.03 A Generally
        • 501.03 B Windstorm Insurance
        • 501.03 C Flood Insurance
        • 501.03 D Earthquake Insurance
        • 501.03 E Terrorism Insurance
      • 501.04 Liability Insurance
        • 501.04 A Commercial General Liability Insurance
        • 501.04 B Professional Liability Insurance
        • 501.04 C Risk Retention Groups and Captive Insurance
        • 501.04 D Workers’ Compensation Insurance
        • 501.04 E Directors’ and Officers’ Liability Insurance
        • 501.04 F Commercial Auto Liability Insurance
      • 501.05 Small Loans
        • 501.05 A Permanent Evidence
        • 501.05 B Excess/Umbrella Insurance
        • 501.05 C Terrorism Insurance
    • Section 502
      Environmental Matters
      • 502.01 Environmental Site Assessments
      • 502.02 Lender’s Responsibilities
      • 502.03 Environmental Indemnity Agreement
    • Section 503
      Seismic Risk
      • 503.01 Seismic Hazard and Risk Factors
      • 503.02 Seismic Risk Assessment (SRA)
      • 503.03 Acceptable Levels of Seismic Risk
      • 503.04 Seismic Retrofit Ordinances
      • 503.05 Seismic Risk Mitigants
Part III
Products and Features
  • Chapter 1
    Student Housing Properties
    • Section 101
      Description
      • 101.01 Student Housing Property
      • 101.02 Dedicated Student Housing Property
    • Section 102
      Generally
    • Section 103
      Dedicated Student Housing Property
      • 103.01 Eligible Property Characteristics
      • 103.02 Ineligible Property Characteristics
      • 103.03 Residential Leases
      • 103.04 Properties on College/University Land
      • 103.05 Additional Underwriting Documentation
    • Section 104
      Underwritten NCF
    • Section 105
      Replacement Reserve
      • 105.01 Determining Replacement Reserve
      • 105.02 Replacement Reserve Funding
  • Chapter 2
    Military Housing Properties
    • Section 201
      Description
    • Section 202
      Ineligible Property Types
    • Section 203
      Generally
  • Chapter 3
    Moderate Rehabilitation Mortgage Loans
    • Section 301
      Description
    • Section 302
      Underwriting
    • Section 303
      Rehabilitation Work Costing More than $20,000 Per Unit
      • 303.01 Rehabilitation Work Evaluation Report
      • 303.02 Rehabilitation Reserve Agreement
    • Section 304
      Supplemental Mortgage Loans
  • Chapter 4
    Green Mortgage Loans
    • Section 401
      Generally
      • 401.01 Description
      • 401.02 High Performance Building Module
      • 401.03 Technical Solar Report
      • 401.04 Green MBS
      • 401.05 Committing and Delivery
    • Section 402
      Green Building Certification
    • Section 403
      Green Rewards Mortgage Loans
      • 403.01 Eligibility
        • 403.01 A Generally
        • 403.01 B HPB Module, HPB Report, and Technical Solar Report Scoring
        • 403.01 C HPB Module, HPB Report, and Technical Solar Report Approval
        • 403.01 D Non-Contiguous Parcels
      • 403.02 Implementing Efficiency Measures
        • 403.02 A Generally
        • 403.02 B Solar PV System
      • 403.03 Underwritten NCF
      • 403.04 Maximum Amount
      • 403.05 Supplemental Mortgage Loans
    • Section 404
      Annual Energy Reporting
  • Chapter 5
    Seniors Housing Properties
    • Section 501
      Generally
      • 501.01 Description
      • 501.02 Eligible Lenders
      • 501.03 Key Principal/Sponsor Experience
    • Section 502
      Eligible Properties
      • 502.01 Eligible Properties
      • 502.02 Ineligible Properties
    • Section 503
      Continuing Care Retirement Communities (CCRCs)
    • Section 504
      Seniors Housing Property Income
      • 504.01 Underwritten NCF
      • 504.02 Skilled Nursing NCF Test
      • 504.03 Operating Lease Ratios
      • 504.04 Operating Lease Analysis
    • Section 505
      Replacement Reserve
    • Section 506
      Medicaid Funds
      • 506.01 Dependency and Medicaid Transition Reserve
      • 506.02 State Medicaid
    • Section 507
      Consultant Reports
      • 507.01 Management, Operations, and Regulatory Compliance
      • 507.02 Management and Operations Reports
      • 507.03 Regulatory Compliance Report
  • Chapter 6
    Manufactured Housing Communities
    • Section 601
      Description
    • Section 602
      Lender Eligibility
    • Section 603
      Legal and Property Compliance
      • 603.01 Borrower and the MH Community
        • 603.01 A Borrower Ownership
        • 603.01 B Collateral; Tenant-Occupied and Affiliate-Owned Homes
        • 603.01 C MH Community
      • 603.02 MH Community Score
      • 603.03 Code Standards
      • 603.04 Flood Zone
        • 603.04 A Rising Water
        • 603.04 B Moving Water
      • 603.05 Lease Terms
        • 603.05 A Master Leases
        • 603.05 B MH Site Leases
        • 603.05 C Loan Document Modification
    • Section 604
      Property Insurance
    • Section 605
      Survey
      • 605.01 Public Roadways, Private Interior Roadways, and Drives
      • 605.02 Setbacks
      • 605.03 Encroachments
    • Section 606
      Property Income and Underwritten NCF
    • Section 607
      Replacement Reserve
  • Chapter 7
    Multifamily Affordable Housing Properties
    • Section 701
      Generally
      • 701.01 Description
      • 701.02 Eligible Lenders
    • Section 702
      MAH Property Eligibility
      • 702.01 Eligible Characteristics and Underwriting
      • 702.02 Ineligible Characteristics and Underwriting
    • Section 703
      Property Income and Underwriting
      • 703.01 Underwritten NCF
      • 703.02 Underwriting
        • 703.02 A Not-for-Profit (IRC §501[c][3]) Borrower may be a Multi-Asset Borrower
        • 703.02 B Appraised Value and Underwriting Value
        • 703.02 C Market Study
        • 703.02 D Affordable Regulatory Agreement Restrictions
        • 703.02 E 35-Year Amortization
        • 703.02 F LIHTC Income Averaging
        • 703.02 G Initial LIHTC Equity
        • 703.02 H Developer Fees
        • 703.02 I Rent-Stabilized Units
    • Section 704
      Subordinate Financing
      • 704.01 Interest Rate and Payments
      • 704.02 Loan Term
      • 704.03 Collateral
      • 704.04 Credit Support
      • 704.05 Soft Financing
      • 704.06 Subordinate Lender
      • 704.07 Developer's Notes
      • 704.08 Subordination Agreement
      • 704.09 Lien Priority and Title Insurance Policy
      • 704.10 Form of Subordinate Loan Documents
      • 704.11 Prepayment
      • 704.12 LIHTC Equity Bridge Loans
    • Section 705
      Restrictive Covenants and Affordable Regulatory Agreements
    • Section 706
      ROAR Loan
      • 706.01 Generally
      • 706.02 Timing
      • 706.03 General Underwriting
      • 706.04 Additional Underwriting and Loan Documents
    • Section 707
      HAP Contract Properties
      • 707.01 Properties with Both HAP Contracts and LIHTC Units
      • 707.02 Restabilization Reserve
      • 707.03 HAP Contract Review Sheet
    • Section 708
      Refinancing Section 236 Properties – IRP is Maintained
      • 708.01 No Additional Proceeds
      • 708.02 Additional Proceeds from Mortgage Loan
      • 708.03 Additional Proceeds from Other Sources
    • Section 709
      LIHTC Properties – Lender Equity Interest
    • Section 710
      Transactions with Fannie Mae Debt and Equity Interests
      • 710.01 Transactions Funded with Tax-Exempt Bond Proceeds
      • 710.02 Fannie Mae Credit-Enhanced Tax-Exempt Bond Issuance
    • Section 711
      FHA Risk Sharing
      • 711.01 Description
      • 711.02 Eligibility
        • 711.02 A Borrowers, Key Principals, Guarantors, and Principals
        • 711.02 B Generally
        • 711.02 C Cash Out
      • 711.03 Mortgage Insurance Premium
      • 711.04 Subsidy Layering Review
      • 711.05 Lender FHA Risk Sharing Reserve and Loss Sharing Modifications
  • Chapter 8
    Cooperative Properties
    • Section 801
      Description
    • Section 802
      Eligible Mortgage Loans
      • 802.01 Basic Conditions
      • 802.02 Financial Conditions
      • 802.03 Property Management Conditions
      • 802.04 Other Considerations
    • Section 803
      Underwriting
      • 803.01 Financial Operation
      • 803.02 Property Valuation
      • 803.03 Subordinate Debt
    • Section 804
      Income Analysis
      • 804.01 Cooperative Market Rental Basis NCF (Underwritten NCF)
      • 804.02 Cooperative Market Rental Basis DSCR (Underwritten DSCR)
      • 804.03 Actual Cooperative Property NCF
      • 804.04 Actual Cooperative Property DSCR
    • Section 805
      Limited Equity Cooperative Properties
  • Chapter 9
    Small Mortgage Loans
    • Section 901
      Generally
      • 901.01 Description
      • 901.02 Applicability
    • Section 902
      Key Principal Guaranty Obligation
    • Section 903
      Occupancy
    • Section 904
      Corporate Leases; Leases to One Entity
    • Section 905
      Property Income Analysis
      • 905.01 Small Mortgage Loan Underwritten NCF (Underwritten NCF)
      • 905.02 Underwritten DSCR
    • Section 906
      Property Management
    • Section 907
      Property Condition
      • 907.01 Site Inspection by Lender or Other Third Party
      • 907.02 Site Inspection by Borrower
      • 907.03 PCA
    • Section 908
      Replacement Reserve
    • Section 909
      Environmental Matters and Inspections
    • Section 910
      Borrower, Key Principals, Guarantors, and Principals
      • 910.01 Borrower Organizational Structure
      • 910.02 Co-Tenant Borrowers
      • 910.03 Key Principals
      • 910.04 Principals
      • 910.05 Financial Statements
      • 910.06 Net Worth and Liquid Assets
    • Section 911
      Credit Reports
      • 911.01 Credit Report
      • 911.02 FICO Scoring
      • 911.03 Reviewing the Credit Report
  • Chapter 10
    Healthy Housing Rewards
    • Section 1001
      Healthy Housing Rewards
    • Section 1002
      Healthy Design
    • Section 1003
      Enhanced Resident Services
  • Chapter 11
    Adjustable Rate Mortgage (ARM) Loans
    • Section 1101
      Description
    • Section 1102
      Underwriting
    • Section 1103
      Prepayment Terms
      • 1103.01 Generally
      • 1103.02 1% Prepayment Premium Schedule
    • Section 1104
      ARM 5/5 Loan Optional 5-Year Adjustable Rate Term Renewal
      • 1104.01 Eligibility
      • 1104.02 Prepayment Terms
  • Chapter 12
    Structured Adjustable Rate Mortgage (SARM) Loans
    • Section 1201
      Description
    • Section 1202
      Underwriting
    • Section 1203
      Actual Amortization Calculation
    • Section 1204
      Prepayment Terms
      • 1204.01 Generally
      • 1204.02 Prepayment Option 1 – Declining Prepayment Premium Schedule
      • 1204.03 Prepayment Option 2 - 1% Prepayment Premium Schedule
    • Section 1205
      Interest Rate Caps
      • 1205.01 Replacement Interest Rate Cap
      • 1205.02 Determining the Cap Strike Rate
      • 1205.03 Including the Cap Cost Factor in the Variable Underwriting Rate
      • 1205.04 Establishing Interest Rate Cap Reserves
      • 1205.05 Interest Rate Cap Contract Documentation and Delivery
  • Chapter 13
    Hybrid Adjustable Rate Mortgage (Hybrid ARM) Loans
    • Section 1301
      Description
    • Section 1302
      Interest Rate Conversion Date
    • Section 1303
      Prepayment Terms
    • Section 1304
      Monthly Principal and Interest Payments
      • 1304.01 During the Fixed Rate Term
      • 1304.02 On the Hybrid ARM Loan Conversion Date
      • 1304.03 During the Adjustable Rate Term
  • Chapter 14
    Supplemental Mortgage Loans
    • Section 1401
      Description
    • Section 1402
      Supplemental Mortgage Loans
      • 1402.01 Description
      • 1402.02 Coterminous and Non-Coterminous
      • 1402.03 Loan Amount
        • 1402.03 A Maximum Loan Amount
        • 1402.03 B Calculating the Debt Service
        • 1402.03 C Calculating the DSCR and LTV
        • 1402.03 D New Loan Test
      • 1402.04 Tier Dropping
        • 1402.04 A Designating
        • 1402.04 B Eligibility
        • 1402.04 C Ineligible Mortgage Loans
      • 1402.05 Streamlined Underwriting
        • 1402.05 A Property
        • 1402.05 B Borrower, Guarantor, Key Principals, and Principals
  • Chapter 15
    Split Mortgage Loans and Bifurcated Mortgage Loans
    • Section 1501
      Description
    • Section 1502
      Characteristics
  • Chapter 16
    Mezzanine Financing and Preferred Equity
    • Section 1601
      Mezzanine Financing
      • 1601.01 Description
        • 1601.01 A Eligible Mortgage Loans
        • 1601.01 B Eligible Terms
        • 1601.01 C Loss Sharing
        • 1601.01 D Lender's Loan Application
      • 1601.02 Underwriting
      • 1601.03 Submission
        • 1601.03 A Materials
        • 1601.03 B Data
      • 1601.04 Intercreditor Agreement
      • 1601.05 Servicing
    • Section 1602
      Preferred Equity
      • 1602.01 Description
        • 1602.01 A Definitions
        • 1602.01 B Exclusions
        • 1602.01 C Eligible Mortgage Loans
        • 1602.01 D Structures
        • 1602.01 E Limitations
        • 1602.01 F Lender's Loan Application
      • 1602.02 Underwriting
      • 1602.03 Hard Preferred Equity
        • 1602.03 A Submission
        • 1602.03 B Outside Counsel and Due Diligence Fees
  • Chapter 17
    Structured Transactions
    • Section 1701
      Description
    • Section 1702
      Credit Facilities
    • Section 1703
      Bulk Deliveries
  • Chapter 18
    Choice Refinance Loans
    • Section 1801
      Eligibility
    • Section 1802
      Lender Delegation
    • Section 1803
      Prepayment Premium
    • Section 1804
      Streamlined Underwriting
      • 1804.01 Zoning
      • 1804.02 Property Condition Assessment (PCA)
      • 1804.03 Environmental Site Assessment
      • 1804.04 Survey
      • 1804.05 Borrower Structure and Experience
      • 1804.06 Borrower Credit
      • 1804.07 Property Management
      • 1804.08 Replacement Reserve
      • 1804.09 Real Estate Tax and Insurance Escrows
    • Section 1805
      Property Ownership Change
Part IV
Committing and Delivery
  • Chapter 1
    Pricing, Fees, and Prepayment Premium
    • Section 101
      Fees
    • Section 102
      Pricing Memo
  • Chapter 2
    Rate Lock and Committing
    • Section 201
      Pre-Commitment
      • 201.01 Borrower Commitment
      • 201.02 Trading Agreements
      • 201.03 Trading Practices
    • Section 202
      Obtaining a Rate Lock
      • 202.01 Rate Lock Period
      • 202.02 Rate Lock Amount
      • 202.03 Locking the Rate
    • Section 203
      Good Faith Deposits
      • 203.01 Borrower Deposit
      • 203.02 Minimum Good Faith Deposit
      • 203.03 Good Faith Deposit and Breakage Fees
    • Section 204
      Commitments
      • 204.01 Submission
      • 204.02 Confirmation
      • 204.03 Modifications
        • 204.03 A Change Requests
        • 204.03 B Rate Lock Extensions
        • 204.03 C Commitment Extensions
    • Section 205
      ASAP Options
  • Chapter 3
    Streamlined Rate Lock
    • Section 301
      Description
      • 301.01 Eligibility
      • 301.02 Timing
    • Section 302
      Preliminary Underwriting
    • Section 303
      Rate Lock
    • Section 304
      Commitment
    • Section 305
      Rate Lock and Commitment Extensions
    • Section 306
      Full Underwriting
      • 306.01 Rate Lock or Commitment Amount Changes
      • 306.02 Mortgage Loan Delivery Package
      • 306.03 Post-Underwriting Scenarios
    • Section 307
      Dual Commitment Option
      • 307.01 Description
      • 307.02 Additional Proceeds
  • Chapter 4
    Delivery
    • Section 401
      Delivery Deadline
    • Section 402
      Submission
      • 402.01 Data and Documents
      • 402.02 Participation Interests
    • Section 403
      Warehouse Lender
    • Section 404
      Wiring
      • 404.01 Wiring Instructions
      • 404.02 Wiring Payee Codes
    • Section 405
      Delivery
      • 405.01 Acceptability and Delivery Tolerance
      • 405.02 Data Changes
    • Section 406
      MBS Delivery Options
    • Section 407
      Delivery Problems and Changes
      • 407.01 Delivery Problems
      • 407.02 Changing the Book-Entry Date
    • Section 408
      Delivery Failure
  • Chapter 5
    Purchase
    • Section 501
      Generally
      • 501.01 Cash and MBS
      • 501.02 Delivery and Purchase
      • 501.03 C&D Purchase Notification
      • 501.04 Fannie Mae Loan Number
    • Section 502
      Purchase Amount
    • Section 503
      Third Party MBS Investor Delivery Scenarios
    • Section 504
      MBS Mortgage Loan Disclosure
      • 504.01 Multifamily MBS Prospectus
      • 504.02 Additional Disclosure
      • 504.03 Disclosure Obligations
    • Section 505
      ASAP
  • Chapter 6
    Structured Transactions
    • Section 601
      Registration
    • Section 602
      Approval
      • 602.01 Approval Documents
      • 602.02 Expiration Dates
      • 602.03 Fees
      • 602.04 Rate Lock
      • 602.05 Loan Documents
    • Section 603
      Commitment
      • 603.01 MBS Mortgage Loans
      • 603.02 Cash Mortgage Loans
    • Section 604
      Delivery
      • 604.01 Delivery Process
      • 604.02 MSFMS Data Errors
    • Section 605
      MBS Disclosure
    • Section 606
      Features and Activities
      • 606.01 Process
      • 606.02 Asset Management Activities
  • Chapter 7
    Variable Rate to Fixed Rate Conversions
    • Section 701
      Conversion Process
    • Section 702
      ARM Loan and SARM Loan Conversions
      • 702.01 Governing Documents
      • 702.02 Minimum Conversion Debt Service Ratio
      • 702.03 Conversion Criteria
      • 702.04 Guaranty Fee and Servicing Fee
      • 702.05 Interest-Only
      • 702.06 Fixed Rate Amortization
      • 702.07 Fixed Rate Debt Service Payments
      • 702.08 Fixed Rate MBS Trade Premium
      • 702.09 New Property Condition Assessment (PCA)
    • Section 703
      Commitment and Delivery
      • 703.01 Rate Lock and Commitment
      • 703.02 Conversion Delivery
        • 703.02 A Deliver Loan Document Amendments
        • 703.02 B Deliver Mortgage Loan Delivery Package
      • 703.03 Conversion Activities
      • 703.04 Pay Off
Part V
Servicing and Asset Management
  • Chapter 1
    General Servicing Requirements, and Servicing for Loan Documents and Specialty Products
    • Section 101
      Servicing – General
    • Section 102
      Servicing Standard
    • Section 103
      Servicing Files
    • Section 104
      Loan Document Servicing
    • Section 105
      Uniform Commercial Code Financing Statements
      • 105.01 Documentation and Filing Requirements
      • 105.02 UCC Renewals or Continuations and Amendments and Terminations
    • Section 106
      Administrative Duties Relating to Letters of Credit
      • 106.01 Retention in Servicing File
      • 106.02 Submission of Certification
      • 106.03 Forwarding New, Replacement or Amended Letters of Credit
      • 106.04 Verification of Issuer Rating
      • 106.05 Documenting Rating in Servicing File
      • 106.06 When Issuer Rating Fails to Meet Standard
      • 106.07 Monitoring Expiration Dates
      • 106.08 Draws on the Letter of Credit
      • 106.09 Release/Reduction of Letter of Credit or Other Collateral
      • 106.10 Replacement Letters of Credit
    • Section 107
      Bond Transactions and Credit Enhancement Mortgage Loans
      • 107.01 Borrower Obligations
        • 107.01 A Compliance with Reimbursement Agreement or Loan Agreement, and Other Loan Documents
        • 107.01 B Payment of Fees
        • 107.01 C Other Fees
        • 107.01 D Timing of Payments
        • 107.01 E Principal Reserve Fund
      • 107.02 Security Instrument; Collateral Agreements; Uniform Commercial Code Filings
        • 107.02 A General
        • 107.02 B Cash Collateral Agreement
        • 107.02 C Investment of Collateral
        • 107.02 D Monitoring Uniform Commercial Code Filings
      • 107.03 Remarketing Agent Changes
  • Chapter 2
    Reporting and Remitting
    • Section 201
      Generally
    • Section 202
      Collection, Tracking and Reporting of Monthly P&I Payments and T&I Amounts
    • Section 203
      Reporting Loan Activity and Security Balance
      • 203.01 Use of Fannie Mae eServicing System
      • 203.02 Reporting Specific Transactions
      • 203.03 Monthly Activity Reporting
        • 203.03 A When to Begin Reporting
        • 203.03 B Cutoff Dates for Loan Activity Reporting
        • 203.03 C Cash Mortgage Loan – Reporting Remittance Amount
      • 203.04 Monthly Securitized Mortgage Loan Security Balance Reporting
        • 203.04 A Reporting Security Balances
        • 203.04 B Same Month Pooling – Security Balance for First Reporting Cycle
        • 203.04 C Security Balances Due by Second Business Day
        • 203.04 D Failure to Meet Reporting Deadline
      • 203.05 Due Dates for Reports
        • 203.05 A Removal Transactions
        • 203.05 B All Other Transactions
      • 203.06 Mortgage Loan Activity Record
        • 203.06 A Payment Collection
        • 203.06 B Fee Collection
        • 203.06 C Mortgage Loan Status
      • 203.07 Reports Generated by Fannie Mae
        • 203.07 A MBS Mortgage Loan Reports
        • 203.07 B Cash Mortgage Loan and MBS Mortgage Loan Reports
      • 203.08 Monthly MBS Mortgage Loan Reconciliations - Pool-to-Security Balance Reconciliations (Not Applicable to PFP MBS)
        • 203.08 A Reconciliation Required
        • 203.08 B Rounding Adjustment
        • 203.08 C Required Annual Adjustment to Correct Principal Balance vs. Security Balance Difference
        • 203.08 D Pool-to-Security Reconciliation Certification
    • Section 204
      Calculation of Interest Due
      • 204.01 Generally
      • 204.02 Calculating Interest Due
        • 204.02 A Actual/360 Interest Calculation Method
        • 204.02 B 30/360 Interest Calculation Method
    • Section 205
      ARM Mortgage Loan Interest Rate and Monthly Payment Changes
      • 205.01 Adjustable Rate Mortgage Loan Interest Rate Changes and Required Monthly Payments
        • 205.01 A The Adjustable Rate Mortgage Loan Index
        • 205.01 B Determining the New Monthly Payment
      • 205.02 Monthly Reporting for ARM Payment/Rate Changes
      • 205.03 Structured ARM Loans
    • Section 206
      Application of Monthly Payments
      • 206.01 Fannie Mae Form Loan Documents
      • 206.02 Non-Fannie Mae Form Loan Documents
    • Section 207
      Payment Shortages
    • Section 208
      Delinquency and Servicing Advances
      • 208.01 Generally
        • 208.01 A Applicability
        • 208.01 B Delinquency Advances on a Mortgage Loan other than a Credit Enhancement Mortgage Loan
        • 208.01 C Delinquency Advances on a Credit Enhancement Mortgage Loan
        • 208.01 D Servicing Advances on a Mortgage Loan other than a Credit Enhancement Mortgage Loan
        • 208.01 E Servicing Advances on a Credit Enhancement Mortgage Loan
      • 208.02 Duration of Payment of Delinquency Advances or Servicing Advances
        • 208.02 A Obligation to Make Delinquency Advances
        • 208.02 B Obligation to Make Servicing Advances
        • 208.02 C Reimbursement for Delinquency and Servicing Advances
      • 208.03 Repayment of Servicing Advances from Borrower
      • 208.04 No Capitalization of Servicing Advances for Securitized Mortgage Loans
      • 208.05 Entitlement to Default Interest
    • Section 209
      Remittance Procedures
      • 209.01 Definitions
        • 209.01 A Interest Distribution Amount
        • 209.01 B Principal Distribution Amount
        • 209.01 C Monthly Remittance
        • 209.01 D Remittance Dates
      • 209.02 Monthly P&I Remittance Dates for Cash and MBS Transactions
      • 209.03 Remittance Dates for Cash Mortgage Loan Payoffs
      • 209.04 Use of Cash Remittance System and Requirements
      • 209.05 Cash Mortgage Loans – Transmitting the Remittance
        • 209.05 A Use of Cash Remittance System
        • 209.05 B Required Date for Commencement of Remittance
        • 209.05 C Remittance Transaction Codes
      • 209.06 Securitized Mortgage Loans – Drafting the Remittance – Funds Drafted under Automated Drafting System (Not Applicable to PFP MBS)
      • 209.07 Additional Requirements for Monthly Remittance for Security Transactions
        • 209.07 A Amount of Security Monthly Remittance
        • 209.07 B Security Interest Distribution Amount
      • 209.08 Securitized Mortgage Loans – Remitting Fees to Fannie Mae
        • 209.08 A Guaranty Fee Due on 7th Calendar Day of Month
        • 209.08 B Guaranty Fee Remittance
        • 209.08 C Same Month Pooling – Interest and Guaranty Fee Remittance for First Reporting Cycle
      • 209.09 Notification to Fannie Mae if Unable to Have Funds Available on any Remittance Date
    • Section 210
      Full Prepayments
      • 210.01 Review of Applicable Loan Documents Required
      • 210.02 Notification of Prepayment; Timing of Prepayment
        • 210.02 A Notice and Timing Consistent with Loan Documents
        • 210.02 B Borrower Notice Must Contain Date of Intended Prepayment and Comply with Notice Requirements of the Loan Documents
        • 210.02 C Loan Document Requirements for Payoff and Lockout Dates
        • 210.02 D Notice to Fannie Mae of Proposed Payoff; Use of Fannie Mae Payoff Calculator
      • 210.03 Timing of Confirmation of the Full Prepayment Payoff Amount
      • 210.04 Full Prepayment for Cash Transactions and PFP MBS
        • 210.04 A Confirming the Full Prepayment Payoff Amount
        • 210.04 B Reporting Full Prepayment Payoff Amount
        • 210.04 C Remitting Full Prepayment Payoff Amount
      • 210.05 Full Prepayment for Securitized Transactions (Not Applicable to PFP MBS)
        • 210.05 A Confirming the Full Prepayment Payoff Amount
        • 210.05 B Reporting Full Prepayment Payoff Amount
        • 210.05 C Remitting Full Prepayment Payoff Amount
    • Section 211
      Partial Prepayments Not From Insurance or Condemnation Proceeds
      • 211.01 Partial Prepayments Generally Prohibited
      • 211.02 Partial Prepayment Procedures
        • 211.02 A Servicer’s Analysis of Loan Documents
        • 211.02 B Fannie Mae Approval Required for Partial Prepayments
        • 211.02 C Prepayment Premium Due on Partial Prepayment
        • 211.02 D Reporting and Remitting Partial Prepayments When Not Permitted in Loan Documents
        • 211.02 E Reporting and Remitting Partial Prepayments When Permitted in Loan Documents
    • Section 212
      Prepayments (Full or Partial) Involving Insurance Proceeds or Condemnation Awards
      • 212.01 Partial Prepayments Generally Permitted
      • 212.02 No Prepayment Premium Required
      • 212.03 Reporting and Remitting Partial Prepayments
    • Section 213
      Prepayment Premium Sharing
      • 213.01 General
      • 213.02 Yield Maintenance Prepayment Premiums – Prepayment Occurs Before the Yield Maintenance Period End Date
        • 213.02 A Calculation of Total Prepayment Premium
        • 213.02 B Calculation of Investor’s Share of Total Prepayment Premium for a Securitized Mortgage Loan
        • 213.02 C Calculation of Fannie Mae’s Share of Total Prepayment Premium
        • 213.02 D Calculation of Servicer’s Share of Total Prepayment Premium
      • 213.03 Yield Maintenance Prepayment Premiums – Prepayment Occurs On or After the Yield Maintenance Period End Date
        • 213.03 A Prepayment On or After Yield Maintenance Period End Date
        • 213.03 B Prepayment During Open Period
      • 213.04 Fixed Rate Mortgage Loans with Graduated Prepayment Premiums
      • 213.05 Prepayment Premiums for ARM Loans and Structured ARM Loans
      • 213.06 Prepayment Premium Waivers; Servicer’s Share of Prepayment Premium
    • Section 214
      Maturing Mortgage Loans/Payoffs
      • 214.01 Balloon Mortgage Loans
      • 214.02 Servicer Notification of Payoff Amount to Borrower
      • 214.03 Calculating and Obtaining Confirmation of Payoff Amount
        • 214.03 A Calculating the Full Payoff Amount
        • 214.03 B Fannie Mae Will Not Confirm Nor Is Responsible for Amounts Owing to Servicer
        • 214.03 C Fannie Mae Confirmation of Full Payoff Amount
        • 214.03 D No Quote to Borrower Until Fannie Mae Confirmation
      • 214.04 Reporting the Payoff and Remitting the Payoff Funds
        • 214.04 A Reporting Full Payoff Amount Through the eServicing System Due By 2nd Business Day of Month
        • 214.04 B Remitting Full Payoff Amount
    • Section 215
      Post-Payoff Actions
      • 215.01 Servicer Required Actions
        • 215.01 A General
        • 215.01 B Individual Mortgage Loan Releases
      • 215.02 Post Payoff Document Retention Requirements
    • Section 216
      DUS Bond Credit Enhancement Transactions – Reporting and Remitting Requirements
      • 216.01 Monthly Bond Credit Enhancement Reporting
      • 216.02 Monthly Remittance Procedures
        • 216.02 A Monthly Remittances of Scheduled Payments to Bond Trustee
        • 216.02 B Replenishment of Withdrawals from the PRF
        • 216.02 C Collection and Remittance of Borrower Reimbursement Obligations for Fannie Mae Advances
        • 216.02 D Monthly Remittance of Fees to Fannie Mae
        • 216.02 E Notice and Collection of Other Fees and Expenses
      • 216.03 Prepayments – General Introduction
        • 216.03 A Bond Redemption Premiums Payable to Bondholders
        • 216.03 B Termination Fee or Prepayment Premium Payable to Fannie Mae
        • 216.03 C Termination When No Prepayment Occurs; Weekly Variable Rate Transactions
      • 216.04 Prepayments – Processing
        • 216.04 A General
        • 216.04 B Prompt Notice of Intended Prepayment
        • 216.04 C Critical Path Due Dates
        • 216.04 D Fannie Mae’s Confirmation Required
      • 216.05 Prepayments: Prepayment Reporting
      • 216.06 Prepayments: Remittances
      • 216.07 Reporting on Delinquency Status
    • Section 217
      Mezzanine Loan Reporting and Remitting
      • 217.01 Remitting DUS Plus Mezzanine Loans
      • 217.02 Payoffs
    • Section 218
      Defeasance
      • 218.01 Mortgage Loan Documents Must Permit Defeasance
      • 218.02 Borrower’s Election to Defease
      • 218.03 Defeasance Option Procedures
        • 218.03 A Defeasance Documents
        • 218.03 B Defeasance Notice
        • 218.03 C Defeasance Commitment Fee
        • 218.03 D Verification of the Defeasance Notice
        • 218.03 E Substitute Collateral
        • 218.03 F Assignment and Assumption
        • 218.03 G Closing Documents
        • 218.03 H Amounts Payable by Borrower
        • 218.03 I Defeasance Deposit
        • 218.03 J Release
        • 218.03 K Fannie Mae Security Liquidated Damages
        • 218.03 L Third-Party Costs
        • 218.03 M Post Defeasance Closing Date
    • Section 219
      Delinquency Reporting and Certification
    • Section 220
      Reporting Collateral Balances in Custodial Accounts
      • 220.01 P&I Custodial Accounts
      • 220.02 Letters of Credit as Collateral
      • 220.03 Report on Fair Value Basis
      • 220.04 What to Report
      • 220.05 When to Report
    • Section 221
      Internal Revenue Service Reporting Requirements
      • 221.01 What to Report
      • 221.02 Filing IRS Form 1099 MISC
      • 221.03 Notifying the Internal Revenue Service about Abandonments or Acquisitions (IRS Form 1099-A)
        • 221.03 A When Required
        • 221.03 B Preparing IRS Form 1099-A
      • 221.04 Notifying the Internal Revenue Service about Cancellations of Indebtedness (IRS Form 1099-C)
        • 221.04 A When Required
        • 221.04 B Determining When a Debt Is Cancelled
        • 221.04 C Preparing IRS Form 1099-C
        • 221.04 D Exceptions to IRS Form 1099-C Reporting
        • 221.04 E Coordination with Reporting Abandonments or Acquisitions
      • 221.05 Reporting via Magnetic Media
  • Chapter 3
    Custodial Account Requirements
    • Section 301
      Custodial Accounts
      • 301.01 General
      • 301.02 Custodial Account Types, Investments, and Depositories
        • 301.02 A Custodial Account Requirements and Investments
        • 301.02 B Eligible Depositories
        • 301.02 C Verifying Depository Ratings
        • 301.02 D Fannie Mae’s Rights in Custodial Accounts
      • 301.03 Required Custodial Accounts
      • 301.04 Servicer Liability
        • 301.04 A Responsibility of Servicer
        • 301.04 B Servicer Liable for Losses
        • 301.04 C No Reimbursement for Losses
        • 301.04 D Overdrafts Not Permitted
    • Section 302
      Establishment of Custodial Accounts
      • 302.01 Notification Requirements
        • 302.01 A Establishment of a Custodial Account
        • 302.01 B Changes to a Custodial Account
        • 302.01 C Termination of a Custodial Account
      • 302.02 Titling of Custodial Accounts
      • 302.03 Daily Cutoff
    • Section 303
      P&I Custodial Accounts
      • 303.01 Purpose of P&I Custodial Accounts
      • 303.02 P&I Commingling Restrictions
        • 303.02 A Maintain Multiple P&I Custodial Accounts
        • 303.02 B No Commingling Permitted
      • 303.03 Withdrawals from P&I Custodial Accounts
      • 303.04 Use as a Clearing Account Not Permitted
    • Section 304
      Tax and Insurance Custodial Accounts
      • 304.01 Purpose of T&I Custodial Accounts
      • 304.02 T&I Commingling Restrictions
      • 304.03 Prohibited Use of T&I Custodial Account Funds
    • Section 305
      Collateral Agreement Custodial Accounts
      • 305.01 Purpose of Collateral Agreement Custodial Accounts
      • 305.02 Commingling Restrictions
    • Section 306
      Interest-Bearing Accounts
      • 306.01 Interest-Bearing Account Requirements
      • 306.02 Loan Documents May Require Interest-Bearing Accounts
    • Section 307
      Clearing Accounts
      • 307.01 Clearing Accounts Permitted
      • 307.02 Custodial Account Requirements Applicable to Clearing Accounts
      • 307.03 Clearing Account Activity Guidelines
        • 307.03 A Timing for Crediting to Custodial Account
        • 307.03 B Debit and Credit Memos Permitted
        • 307.03 C Using Checks
        • 307.03 D Insufficient Funds Checks
        • 307.03 E Records and Audit Trails
    • Section 308
      Drafting Accounts
      • 308.01 Establishing Drafting Accounts
      • 308.02 Consolidated Custodial Account
        • 308.02 A Distinct Custodial Accounts for Securitized Mortgage Loans (Other Than PFP MBS)
        • 308.02 B Timely Remittance
        • 308.02 C Commingling of P&I Funds Permitted for Cash Executions
        • 308.02 D Commingling of P&I Funds Permitted for Securitized Mortgage Loans
        • 308.02 E Separate Accounts for P&I Funds Permitted
        • 308.02 F Corporate/General Lender Accounts Not Permitted
        • 308.02 G Timing of Commingling
        • 308.02 H Election of Cash Remittance System or Automated Drafting System Required
        • 308.02 I Required Records
    • Section 309
      Custodial Account Reconciliations
    • Section 310
      Taxes, Assessments, Insurance Premiums, and Other Charges/Obligations
      • 310.01 Taxes and Insurance and Other Custodial Accounts
      • 310.02 Collections for T&I and Other Obligations
        • 310.02 A T&I and Other Obligations
        • 310.02 B Collections for T&I Obligations
        • 310.02 C No Financing for T&I Obligations
      • 310.03 Interest Earned on T&I and Other Custodial Accounts
      • 310.04 Accounting for T&I Custodial Accounts
      • 310.05 Commingling of Funds in T&I Custodial Accounts
      • 310.06 T&I Account Shortfalls
      • 310.07 Periodic Analysis of Borrower’s T&I Obligations and Custodial Account Collections
        • 310.07 A Timing of Analysis
        • 310.07 B Insufficient Borrower Funds
        • 310.07 C Custodial Account Surplus
      • 310.08 Annual T&I Custodial Account Statements
  • Chapter 4
    Asset Management: Loan Document Administration
    • Section 401
      Servicing Requirements
      • 401.01 General
      • 401.02 Monitoring Compliance with Loan Documents
    • Section 402
      Delegation of Decision-Making Authority; Retention of Outside Legal Counsel
      • 402.01 Delegation of Decision-Making Authority
      • 402.02 Retention of Outside Legal Counsel
    • Section 403
      Execution of Documents by Servicer – Limited Power of Attorney
    • Section 404
      Execution of Documents by Fannie Mae
      • 404.01 Submission of Documents to Fannie Mae
      • 404.02 Servicer Certification When Fannie Mae Approval Is Not Required
      • 404.03 Servicer Certification When Fannie Mae Approval Is Required
    • Section 405
      Fees Due to Fannie Mae
    • Section 406
      Follow-Up Actions by the Servicer
    • Section 407
      Subordinate Financing
      • 407.01 Non-Fannie Mae Subordinate Financing
      • 407.02 Prerequisite for Subordinate Financing
      • 407.03 Fees for Subordinate Financing
      • 407.04 Submitting the Request for Subordinate Financing
      • 407.05 Fannie Mae Approval and Execution
      • 407.06 Subsequent Servicer Actions
    • Section 408
      Administration of Collateral Agreements
      • 408.01 General Administrative Requirements
        • 408.01 A Administration of Funds
        • 408.01 B Funds to be Held in a Custodial Account
        • 408.01 C Use of Funds
        • 408.01 D Funds as Additional Security for Mortgage Loan
        • 408.01 E Servicer’s Fees and Costs
        • 408.01 F Waiver or Modification of Terms of Collateral Agreement
      • 408.02 Achievement Agreement or Other Agreement for Additional Collateral
        • 408.02 A General
        • 408.02 B Releases or Reductions in Collateral
        • 408.02 C Draws on Letters of Credit or Application of Other Collateral
        • 408.02 D Releasing Additional Escrows for Principal and Interest, Taxes and Insurance, and Replacement Reserves
      • 408.03 Completion/Repairs
        • 408.03 A General
        • 408.03 B Extensions for Completion/Repairs
        • 408.03 C Completion/Repair Loan Document Amendments
        • 408.03 D Servicer’s Administrative Requirements
        • 408.03 E Processing Borrower Requisitions
        • 408.03 F Inspections
        • 408.03 G Fees
        • 408.03 H Completion/Repair Defaults
      • 408.04 Replacement Reserve
        • 408.04 A General
        • 408.04 B Replacement Reserve Loan Document Amendments
        • 408.04 C Servicer’s Administrative Requirements
        • 408.04 D Modifications to Replacement Reserve Deposits
        • 408.04 E New Property Condition Assessments
        • 408.04 F When Replacement Reserve Funding Was Partially or Fully Waived
        • 408.04 G Interest on Replacement Reserve Funds
        • 408.04 H Items Eligible for Funding from the Replacement Reserve
        • 408.04 I Items Not Eligible for Funding from the Replacement Reserve
        • 408.04 J Processing Borrower Requisitions
        • 408.04 K Inspections
        • 408.04 L Fees
        • 408.04 M Replacement Reserve Defaults
        • 408.04 N Return of Replacement Reserve Funds to Borrower
        • 408.04 O Alternative Funding of Replacement Reserves for Portfolio Mortgage Loans
    • Section 409
      Interest Rate Hedge Requirements
      • 409.01 General
      • 409.02 Interest Rate Hedge Coverage
        • 409.02 A Bond Credit Enhancement Transactions
        • 409.02 B Structured Transactions
        • 409.02 C All Hedges
      • 409.03 Interest Rate Hedge Term
      • 409.04 Lien Filings and Collateral
      • 409.05 Borrower Payments
        • 409.05 A Interest Rate Caps
        • 409.05 B Interest Rate Swaps
      • 409.06 Provider Ratings
      • 409.07 Replacement Interest Rate Hedge and Notification
      • 409.08 Replacement Interest Rate Hedge Documents and Follow Up
    • Section 410
      Ground Leases
    • Section 411
      Notice of Lien or Noncompliance with Applicable Laws, Ordinances and Regulations
    • Section 412
      Property Forfeitures and Seizures
    • Section 413
      Property and Liability Insurance
      • 413.01 Property and Liability Insurance
      • 413.02 No Financing for Property and Liability Insurance Premiums
      • 413.03 Flood Map Changes; Obtaining Flood Insurance
      • 413.04 Lender Placed Insurance
        • 413.04 A Property and Liability Insurance
        • 413.04 B Flood Insurance
        • 413.04 C Servicer’s Administrative Costs and Expenses
    • Section 414
      Casualty Losses – Performing Mortgage Loans
      • 414.01 Notice
      • 414.02 Filing Proof of Loss
      • 414.03 Casualty Loss Assessment
      • 414.04 Required Casualty Loss Property Inspection
      • 414.05 Documentation for Required Casualty Loss Property Inspections
      • 414.06 Endorsement of Insurance Loss Draft or Check When Payable to Fannie Mae
      • 414.07 Endorsement of Insurance Loss Draft or Check When Not Payable to Fannie Mae
      • 414.08 Insurance Loss Draft or Check Not Payable to Either Fannie Mae or Servicer
      • 414.09 Application of Insurance Loss Proceeds
        • 414.09 A Fannie Mae Determination Required
        • 414.09 B Disposition of Insurance Loss Proceeds
      • 414.10 Property Restoration Requirements
      • 414.11 Commencement of Repair/Restoration Work
      • 414.12 Disbursements
        • 414.12 A Prerequisites for Disbursement of Funds
        • 414.12 B Disbursing Funds
        • 414.12 C Content of Disbursement Request
        • 414.12 D Disbursement Amount
        • 414.12 E Final Disbursement; Notice to Fannie Mae
        • 414.12 F Documentation in Servicing File
      • 414.13 Borrower’s Failure to Diligently Pursue Repair
      • 414.14 Reimbursement of Administrative Costs
    • Section 415
      Casualty Losses – Non-Performing Mortgage Loans
    • Section 416
      Credit Facilities and Bulk Deliveries
      • 416.01 General
      • 416.02 Delegation of Decisions
        • 416.02 A Decisions and Actions Not Delegated
        • 416.02 B Decisions Delegated by the Delegated Transaction Form 4636 series
        • 416.02 C Other Delegated Decisions
      • 416.03 Approval Requests
      • 416.04 Release and Substitution Requests
      • 416.05 Borrow-Up (Future Advance) Requests
      • 416.06 Facility Revaluations
      • 416.07 Supplemental Mortgage Loans Not Permitted
      • 416.08 Additional Information
    • Section 417
      Seniors Housing Properties
      • 417.01 General
      • 417.02 Decisions and Actions Delegated and Not Delegated
      • 417.03 Approval Requests
      • 417.04 Seniors Housing Expansion/Conversion Requests
        • 417.04 A Permitted Purpose
        • 417.04 B Submission Requirements
        • 417.04 C Requirements and Monitoring
        • 417.04 D Construction Completion Requirements
        • 417.04 E Request Changes in Unit Count/Mix in the MAMP
    • Section 418
      Credit Enhancement Mortgage Loans and Multifamily Affordable Housing Properties
      • 418.01 Bond Transactions and Credit Enhancement Mortgage Loans
      • 418.02 Compliance Issues Relative to Bond Credit Enhancement Transactions
      • 418.03 Monitoring Compliance; Notification of Noncompliance
        • 418.03 A Affordable Regulatory Agreement
        • 418.03 B Default Notice for Failure to Comply with the Bond Documents
      • 418.04 Multifamily Affordable Housing (MAH) Properties
      • 418.05 Low-Income Housing Tax Credits
      • 418.06 Enhanced Resident Services
      • 418.07 HAP Contract Approval and Releasing Restabilization Reserve
    • Section 419
      MH Communities with Manufactured Housing Site Lease Protections for Tenants
    • Section 420
      Single Asset Entity Conversion
    • Section 421
      Loan Document Amendments
    • Section 422
      Maturing Mortgage Loans
      • 422.01 Written Policy
      • 422.02 Refinance Eligibility
      • 422.03 Borrower Communications
      • 422.04 Fannie Mae Communications
  • Chapter 5
    Surveillance
    • Section 501
      General
    • Section 502
      Property Inspections
      • 502.01 MBA Standard Inspection Form
      • 502.02 Mortgage Loans with Property Condition Concerns (Not Limited to Watchlist Loans)
      • 502.03 Property Inspection Protocols
      • 502.04 Property Inspection Frequency; Submission of Property Inspection Forms
        • 502.04 A Timing of Property Inspections
        • 502.04 B Submission of Property Inspection Forms
      • 502.05 Property Inspector Qualifications
        • 502.05 A Minimum Inspector Experience
        • 502.05 B Third-Party Inspector Requirements
      • 502.06 Content of Property Inspections
        • 502.06 A Number of Units to be Inspected; “Down” Units
        • 502.06 B Selection of Units to be Inspected
        • 502.06 C Photographs
        • 502.06 D Consultation with Property Manager and Staff
        • 502.06 E Analysis of Market
        • 502.06 F Analysis of Collateral
        • 502.06 G Life Safety Issues
      • 502.07 Servicer Property Inspection Quality Control Requirements
        • 502.07 A Review of Inspection Forms
        • 502.07 B Quality Control Program
      • 502.08 Retention of Inspection Forms
      • 502.09 Other Property Inspections; Inspection Fees
    • Section 503
      Quarterly and Annual Financial Analysis of Operations
      • 503.01 Electronic Reporting of Financial Analysis of Operations
      • 503.02 Request for Waivers of Quarterly and Annual Reporting on Financial Analysis of Operations
        • 503.02 A Waivers for Reasons Other Than Unresponsive Borrowers
        • 503.02 B Waivers due to Unresponsive Borrowers
      • 503.03 Quarterly Reporting on Financial Analysis of Operations
        • 503.03 A Quarterly Reporting Requirements
        • 503.03 B Quarterly Submission Requirements by Asset Class
      • 503.04 Annual Reporting on Financial Analysis of Operations
        • 503.04 A Annual Financial Analysis Reporting Requirements
        • 503.04 B Submitting the Annual Financial Analysis of Operations
        • 503.04 C Annual Review
        • 503.04 D Asset Management Testing
        • 503.04 E Maintenance of Records
    • Section 504
      Compliance with Loan Agreement Requirements
      • 504.01 General
      • 504.02 Obtaining Required Financial and other Reporting Items
        • 504.02 A Notice to the Borrower
        • 504.02 B Annual Reporting of Guarantor Financial Condition
        • 504.02 C Failure of Borrower to Provide Required Guarantor Financial Reporting
        • 504.02 D Lender Review of Required Financial Reporting
        • 504.02 E Maintenance of Annual Financial Reporting Records
  • Chapter 6
    Watchlist Management
    • Section 601
      General
    • Section 602
      Risk Rate and Maintain Servicer Watchlist
    • Section 603
      Servicer Watchlist Classifications and Requirements
      • 603.01 Rating Classifications
        • 603.01 A Pass Asset
        • 603.01 B Pass/Watch Asset
        • 603.01 C Special Mention Asset
        • 603.01 D Substandard Asset
        • 603.01 E Doubtful Asset
      • 603.02 Identification on Servicer Watchlist
      • 603.03 Increased Communication with Fannie Mae
    • Section 604
      Servicer Watchlist Submission
    • Section 605
      Fannie Mae Watchlist
    • Section 606
      Action Plans
      • 606.01 Action Plans for Primary Risk Mortgage Loans
      • 606.02 Information Requests and Action Plans for Secondary Risk Mortgage Loans
      • 606.03 Defaulted Mortgage Loans on Fannie Mae or Servicer Watchlist
    • Section 607
      Property Condition Concerns (Not Limited to Watchlist Loans)
    • Section 608
      Servicer Fees for Workout, Modification, or Reinstatement
    • Section 609
      Fannie Mae Contractors
  • Chapter 7
    Non-Performing Mortgage Loans
    • Section 701
      Generally
    • Section 702
      Secondary Risk Mortgage Loans and Primary Risk Mortgage Loans
      • 702.01 Generally
      • 702.02 Secondary Risk Mortgage Loans
        • 702.02 A Definition
        • 702.02 B Lender is Special Servicer
        • 702.02 C Deemed Exhaustion of Recourse Obligation
      • 702.03 Primary Risk Mortgage Loans Defined
        • 702.03 A Definition
        • 702.03 B Fannie Mae is Special Servicer
    • Section 703
      Mortgage Loan Defaults
      • 703.01 Anticipatory Defaults
      • 703.02 Performance Defaults
        • 703.02 A Failure of Borrower to Perform
        • 703.02 B Service of Process
        • 703.02 C Lender Tenders for Minor or Immaterial Defaults
      • 703.03 Monetary or Payment Defaults
      • 703.04 Date of Default
        • 703.04 A Definition of Date of Default
        • 703.04 B Definition of Non-Performing Mortgage Loan
        • 703.04 C Partial Payments by Borrower Do Not Change Date of Default
      • 703.05 Late Charges and Default Interest
        • 703.05 A Timing for Imposition of Late Charges and Default Interest
        • 703.05 B Late Charges and Default Interest
        • 703.05 C No Deduction for Late Charges or Default Interest
        • 703.05 D Enforceability of Late Charges and Default Interest
    • Section 704
      Notice of Default; Reservation of Rights
      • 704.01 Notice of Default
        • 704.01 A Notice to Fannie Mae of Payment Default
        • 704.01 B Notice to Fannie Mae of Performance Default
        • 704.01 C Types of Performance Defaults
        • 704.01 D Contact with Borrower
        • 704.01 E Pre-Negotiation Letter
      • 704.02 Partial Payments; Late Payments
        • 704.02 A Partial Payments
        • 704.02 B Late Partial Payment
        • 704.02 C Full Payment After Expiration of Period Before Assessing Late Charges
        • 704.02 D Application of Partial Payments
        • 704.02 E Failure to Make Any Payment
        • 704.02 F Copies of Letters Sent to Borrower; Correspondence with Borrower
    • Section 705
      Capital Repairs and Protection of Property and Property Income
      • 705.01 Funding Capital Repairs During Default Resolution
        • 705.01 A Generally
        • 705.01 B Health and Safety Repairs
      • 705.02 Protection of Property Income
      • 705.03 Property Management Changes
        • 705.03 A Primary Risk Mortgage Loans
        • 705.03 B Secondary Risk Mortgage Loans
        • 705.03 C Approval Decision Criteria and Timing
        • 705.03 D Documenting the Property Management Change
    • Section 706
      Reinstatement; Calculation of Payoff Amount
      • 706.01 Reinstatement
        • 706.01 A Primary Risk Mortgage Loans
        • 706.01 B Secondary Risk Mortgage Loans
      • 706.02 Calculation of Payoff Amount
    • Section 707
      Non-Performing Primary Risk Mortgage Loans – Transfers to Fannie Mae Special Asset Management
      • 707.01 Transfer to Special Servicing
      • 707.02 Asset Review
    • Section 708
      Non-Performing Secondary Risk Mortgage Loans – Special Servicing
      • 708.01 Servicer Performs Loss Mitigation Actions
      • 708.02 Servicer Workout Action Template (“SWAT”)
        • 708.02 A Delivery of SWAT
        • 708.02 B Purpose of SWAT
        • 708.02 C Contents of SWAT
        • 708.02 D Fannie Mae Approves SWAT
        • 708.02 E Fannie Mae does not Approve SWAT
        • 708.02 F Updating SWAT
        • 708.02 G Failure to Timely Deliver SWAT
        • 708.02 H No Credit Against Recourse
    • Section 709
      Special Servicing of Primary Risk Mortgage Loans
      • 709.01 Fannie Mae Performs Loss Mitigation Actions
      • 709.02 Servicing Transfer Memo
    • Section 710
      Engagement of Legal Counsel
      • 710.01 Fannie Mae Retains Legal Counsel
      • 710.02 Primary Risk Mortgage Loans
      • 710.03 Secondary Risk Mortgage Loans
      • 710.04 Payment of Legal Counsel Fees
        • 710.04 A Primary Risk Mortgage Loans
        • 710.04 B Secondary Risk Mortgage Loans
    • Section 711
      Courses of Action
      • 711.01 Election and Implementation of a Course of Action
      • 711.02 Course of Action – Lender Purchase of Mortgage Loan
        • 711.02 A Primary Risk Mortgage Loans
        • 711.02 B Secondary Risk Mortgage Loans
        • 711.02 C Purchase Price for Mortgage Loans
        • 711.02 D No Fannie Mae Approval Required
        • 711.02 E Implementation of Course of Action
      • 711.03 Course of Action – Lender Workout Election
        • 711.03 A Lender Workout Defined
        • 711.03 B Documentation and Terms of Lender Workout
        • 711.03 C Lender Workout Has No Impact on Loss Sharing or Recourse Obligation
        • 711.03 D No Fannie Mae Approval Required
        • 711.03 E Servicer Makes Delinquency Advances But Fails to Report Mortgage Loan Delinquent
        • 711.03 F Foreclosure Process Continues Unless Otherwise Agreed to by Fannie Mae
      • 711.04 Course of Action – A Joint Workout
        • 711.04 A Joint Workout Defined
        • 711.04 B Delinquency Advances Must Be Made During Negotiation of Joint Workout
        • 711.04 C Joint Workout Process
        • 711.04 D Modification, Extension, and Forbearance Fees
        • 711.04 E Triggering Modification Fees; Other Fees
        • 711.04 F Foreclosure Process Continues Unless Otherwise Agreed to by Fannie Mae
      • 711.05 Course of Action - Foreclosure
        • 711.05 A Primary Risk Mortgage Loans
        • 711.05 B Secondary Risk Mortgage Loans
        • 711.05 C Deed-in-Lieu of Foreclosure
        • 711.05 D Management of Property Post Title Vesting in Fannie Mae
        • 711.05 E Deficiency Suits
      • 711.06 Course of Action – Note Sale Election or Discounted Loan Payoff
        • 711.06 A Note Sale and Discounted Loan Payoff Defined
        • 711.06 B Lender Ability to Bid
        • 711.06 C Any Note Sale or Discounted Payoff Gives Rise to Loss Sharing Event
        • 711.06 D Note Sale – Secondary Risk Mortgage Loans
        • 711.06 E Discounted Loan Payoff - Secondary Risk Mortgage Loans
    • Section 712
      Dual Track Approach
      • 712.01 Dual Track Approach Generally
      • 712.02 Waiver of Dual Track Approach
      • 712.03 Track One: Dialogue with the Borrower
        • 712.03 A Purpose of Track One
        • 712.03 B First 30 Calendar Days after a Default
        • 712.03 C Calendar Days 31 through 60 after a Payment Default or Performance Default
        • 712.03 D Cessation of Dialogue with the Borrower
      • 712.04 Track Two: Foreclosure Process
        • 712.04 A The Foreclosure Process
        • 712.04 B REO Management
      • 712.05 Description of Contractual Relationships
        • 712.05 A Two Contractual Relationships
        • 712.05 B No Disclosure of Lender’s Contract Terms to Borrower; Borrower Not a Third-Party Beneficiary of Lender Contract
        • 712.05 C Primary Risk Mortgage Loans
        • 712.05 D Secondary Risk Mortgage Loans
      • 712.06 Asset Audits for Secondary Risk Mortgage Loans
        • 712.06 A Purpose of Asset Audits
        • 712.06 B Personnel Performing Asset Audits
        • 712.06 C Timing of Asset Audits
        • 712.06 D Content of Asset Audits
        • 712.06 E Pre-Negotiation Letter
        • 712.06 F Special Requirements for the Environmental Assessment
      • 712.07 Dual Track Timeline
    • Section 713
      Loss Sharing and the Appraisal Process in connection with a Foreclosure Event
      • 713.01 General
        • 713.01 A Appraisal Required; Defined Terms
        • 713.01 B Compliance with Loss Sharing Addendum
        • 713.01 C Approved Appraisers
        • 713.01 D Appraisal Requirements
        • 713.01 E Appraisal Notice and Election of Appraisal Methodology
      • 713.02 Single Appraisal Approach
        • 713.02 A Single Appraisal Approach Timeline
        • 713.02 B Draft Appraisal Review
        • 713.02 C Acceptable Draft Appraisal
        • 713.02 D Non-Acceptable Draft Approach
      • 713.03 Dual Appraisal Approach
        • 713.03 A Dual Appraisal Approach Timeline
        • 713.03 B Average of Appraised Values
        • 713.03 C Third Appraisal
  • Chapter 8
    In Place Loans
    • Section 801
      General
    • Section 802
      In Place Loan Categories
      • 802.01 Loan Sizing
      • 802.02 Level 2 In Place Loans
      • 802.03 Level 3 In Place Loans
      • 802.04 Level 2 and Level 3 In Place Loans – Generally
    • Section 803
      Eligibility Requirements
    • Section 804
      Underwriting Process
      • 804.01 Generally
      • 804.02 Specific Underwriting Requirements
        • 804.02 A Borrower Structure and Experience
        • 804.02 B Property Management
        • 804.02 C Occupancy
        • 804.02 D Property Zoning, Location, and Condition
    • Section 805
      Appraisals, Inspections and Loan Documentation
      • 805.01 Appraisal
      • 805.02 Physical Condition Assessment
      • 805.03 Environmental Assessment
      • 805.04 Mortgage Loan Documents
      • 805.05 Title Policy and Survey Requirements
        • 805.05 A Title Policy
        • 805.05 B Survey
      • 805.06 Subordinate Debt
    • Section 806
      Fees and Pricing Premiums
      • 806.01 Origination Fees
      • 806.02 Pricing Premiums
      • 806.03 Loan Modification, Extension and Forbearance Fees
Appendix
Glossary
Chapter 1

General Servicing Requirements, and Servicing for Loan Documents and Specialty Products

Section 101

Servicing – General

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must service Mortgage LoansMortgage 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. :

  • with regard to Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. , on behalf of Fannie Mae, in Fannie Mae’s corporate capacity and in Fannie Mae’s capacity as Trustee, for the benefit of and in the best interest of the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. in the SecuritySecurityMBS, PFP MBS, or REMIC. ;
  • with regard to Credit Enhancement Mortgage LoansCredit Enhancement Mortgage LoansMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. , on behalf of Fannie Mae as the issuer of the Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. ; and
  • with regard to Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. , on behalf of Fannie Mae, in Fannie Mae’s corporate capacity.

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). 's servicing obligations continue until terminated by the terms of the GuideGuideMultifamily Selling and Servicing Guide and Delegated Underwriting and Servicing Guide, including any exhibits, appendices, or other referenced forms, as updated, amended, restated, modified, or supplemented; however, for any topic in the Multifamily Selling and Servicing Guide, that Guide shall…, and the Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. .

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must always act diligently to protect Fannie Mae's investment interests in the Mortgage LoansMortgage 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. .  The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is expected to exercise prudent business judgment in all of its servicing and asset management activities, including those relating to matters for which Fannie Mae has not established specific requirements or standards.  While this Part V delegates significant decision-making authority and responsibility to the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). , consultation with the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). ’s Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). is encouraged whenever matters arise that could materially affect Fannie Mae's investment interests.  All requirements of this Part V are also applicable to any Sub-Servicer of the 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. .

Section 102

Servicing Standard

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must service the 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 accordance with and, in the event of any conflict, in the following order of priority:

  • the applicable Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. ;
  • the Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. ;
  • the GuideGuideMultifamily Selling and Servicing Guide and Delegated Underwriting and Servicing Guide, including any exhibits, appendices, or other referenced forms, as updated, amended, restated, modified, or supplemented; however, for any topic in the Multifamily Selling and Servicing Guide, that Guide shall…; and
  • commercially prudent servicing practices and sound business judgment as would be exercised by prudent institutional mortgage lenders and servicers servicing mortgage loans comparable to the Mortgage LoansMortgage 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. in the jurisdictions where the PropertyPropertyMultifamily residential property securing the Mortgage Loan and including the land (or Leasehold interest in land), Improvements, and personal property (as defined in the Uniform Commercial Code). is located.
Section 103

Servicing Files

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must maintain a separate Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. 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. .  The Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. may be maintained in paper or electronic imaged form so long as all requirements for record retention provided in the Program Rules are met.  The Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. 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. must include copies of any document relevant to the 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. as provided in Servicing File Content Requirements (Form 4800).

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must carefully document the actions it takes with respect to 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 the Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. .  The Servicing FilesServicing FilesFile for each Mortgage Loan serviced by the Lender. will be examined as part of Fannie Mae’s periodic assessment of the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). .

Section 104

Loan Document Servicing

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. that it services, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is responsible for monitoring the BorrowerBorrowerPerson who is the obligor per the Note. ’s compliance with the terms and conditions of all Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. , and for taking such actions as are appropriate to facilitate the BorrowerBorrowerPerson who is the obligor per the Note. ’s compliance or address any instance of noncompliance.

In the event of any conflict among the requirements of the Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. , the GuideGuideMultifamily Selling and Servicing Guide and Delegated Underwriting and Servicing Guide, including any exhibits, appendices, or other referenced forms, as updated, amended, restated, modified, or supplemented; however, for any topic in the Multifamily Selling and Servicing Guide, that Guide shall…, or the provisions of any Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. , the provisions of the Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. shall control.

Section 105

Uniform Commercial Code Financing Statements

105.01

Documentation and Filing Requirements

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must:

  • retain in the Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. a file-stamped copy of all applicable UCCUCCUniform Commercial Code financing statements, continuations, renewals, and assignments (UCCUCCUniform Commercial Code -1s and UCCUCCUniform Commercial Code -3s) filed in connection with the Personal PropertyPersonal PropertyFurniture, fixtures, equipment, and other tangible personal property located on or used in connection with the Property. securing the 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. ;
  • preserve, on a continuous basis, Fannie Mae's first LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. security interest in the Personal PropertyPersonal PropertyFurniture, fixtures, equipment, and other tangible personal property located on or used in connection with the Property. by ensuring that all necessary UCCUCCUniform Commercial Code financing statement renewal or continuation statements are filed on a timely basis (i.e., before the date on which any outstanding filing lapses, or by any earlier deadline for filing that may be applicable in the particular jurisdiction); and
  • maintain an effective "tickler" system for tracking the UCCUCCUniform Commercial Code financing statement renewal or continuation filing deadlines applicable to all of the Mortgage LoansMortgage 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. it services for Fannie Mae.

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is liable for any losses incurred by Fannie Mae due to the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). 's failure to effect a timely renewal or continuation of a UCCUCCUniform Commercial Code financing statement.

105.02

UCC Renewals or Continuations and Amendments and Terminations

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is hereby authorized and required to file in all appropriate jurisdictions all required UCCUCCUniform Commercial Code renewal or continuation financing statements on Fannie Mae's behalf as servicer of the 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. .  The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is also authorized and required to file amendments to the UCCUCCUniform Commercial Code financing statements required to correct any scrivener’s error.  Unless specific authority is granted by Fannie Mae to serve as Fannie Mae’s attorney-in-fact pursuant to a Limited Power of AttorneyLimited Power of AttorneyLegal document authorizing a Servicer to execute certain Loan Documents related to the asset management of a Mortgage Loan as attorney-in-fact on behalf of Fannie Mae. (as described in Part V, Chapter 4: Asset Management: Loan Document Administration, Section 403: Execution of Documents by Servicer – Limited Power of Attorney), the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is not authorized to sign or file any amendment to a UCCUCCUniform Commercial Code financing statement (other than an amendment to correct a scrivener’s error) or termination of any UCCUCCUniform Commercial Code financing statement.

Section 106

Administrative Duties Relating to Letters of Credit

106.01

Retention in Servicing File

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must retain a copy of the executed Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. , and the associated Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. in its Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. .  Fannie Mae will hold the original Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. and any amendments thereto.

106.02

Submission of Certification

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must submit a Letter of Credit Authorization and Certification Form (Form 4664B) with any new or replacement Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. , and must otherwise comply with the provisions of Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit.

106.03

Forwarding New, Replacement or Amended Letters of Credit

Any new, replacement, or amended Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. sent to the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). rather than to Fannie Mae must be forwarded to Fannie Mae immediately.

106.04

Verification of Issuer Rating

While the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. is outstanding, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor the rating of the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. issuer as required in Part I, Chapter 2: Mortgage Loan, Section 204.03: Verifying Issuer Ratings, and notify Multifamily Business OperationsMultifamily Business OperationsTeam that can be contacted at [email protected]  whenever the issuer ceases to meet the required rating, regardless of whether the Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. provides issuer rating acceptability or gives Fannie Mae the right to take any action in the event of a rating drop.

106.05

Documenting Rating in Servicing File

Each time the issuer’s rating is verified, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must document the current rating in its Servicing FileServicing FileFile for each Mortgage Loan serviced by the Lender. .

106.06

When Issuer Rating Fails to Meet Standard

If the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. issuer fails to meet the rating standards prescribed by the Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. , other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. , or the GuideGuideMultifamily Selling and Servicing Guide and Delegated Underwriting and Servicing Guide, including any exhibits, appendices, or other referenced forms, as updated, amended, restated, modified, or supplemented; however, for any topic in the Multifamily Selling and Servicing Guide, that Guide shall… (if not specified in the Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. ), the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must:

  • immediately notify Multifamily Business OperationsMultifamily Business OperationsTeam that can be contacted at [email protected] ; and
  • send written notification to the BorrowerBorrowerPerson who is the obligor per the Note. to furnish a replacement or confirming Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. from an acceptably rated institution by the replacement deadline specified in the applicable Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. , or if not specified, by the earlier of 30 days after the date of such notice, or 5 Business DaysBusiness 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, a day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. prior to the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. ’s expiration date.
106.07

Monitoring Expiration Dates

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must effectively monitor the expiration date of any Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. to ensure that Fannie Mae receives an acceptable renewal or replacement Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. by the deadline specified in the Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. , or if not specified, by at least 5 Business DaysBusiness 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, a day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. prior to the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. ’s expiration date.  Failure to provide a substitute or renewal Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. will result in Fannie Mae’s presentment of a sight draft against the expiring Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. .

106.08

Draws on the Letter of Credit

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must promptly notify Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at [email protected] and Multifamily Business OperationsMultifamily Business OperationsTeam that can be contacted at [email protected]  whenever a draw on a Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. may be warranted.  If Fannie Mae determines that a draw should be made, Fannie Mae will present a sight draft, signed by Fannie Mae (as beneficiary) to the issuer and arrange to have the cash proceeds wired to a designated Fannie Mae account.

106.09

Release/Reduction of Letter of Credit or Other Collateral

Unless requested in connection with the 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. being repaid in full, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is responsible for:

  • assessing any BorrowerBorrowerPerson who is the obligor per the Note. request for a full release or partial reduction of the Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. or other collateral held by Fannie Mae or the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). in accordance with the terms and conditions of the applicable Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. ;
  • sending a recommended course of action to Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at [email protected] ; and
  • providing written notification to the BorrowerBorrowerPerson who is the obligor per the Note. of the approval or denial of each request.
106.10

Replacement Letters of Credit

Any replacement Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. must have an expiration date that is at least 30 days past the expiration of the applicable Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. .

Section 107

Bond Transactions and Credit Enhancement Mortgage Loans

107.01

Borrower Obligations

107.01A

Compliance with Reimbursement Agreement or Loan Agreement, and Other Loan Documents

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor Borrower'sBorrower'sPerson who is the obligor per the Note. compliance with any Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , and the other Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. and BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Documents.  For example, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor financial information required to be provided by the BorrowerBorrowerPerson who is the obligor per the Note. or any other PersonPersonLegal person, including an individual, estate, trust, corporation, partnership, limited liability company, financial institution, joint venture, association, or other organization or entity (whether governmental or private). under the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. .

107.01B

Payment of Fees

1.  Collection from Borrower

In addition to invoicing and collecting from the BorrowerBorrowerPerson who is the obligor per the Note. the BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Scheduled PaymentsScheduled PaymentsBond Credit Enhancements, see Part XIV of the DUS Guide. (or P&IP&IPrincipal and interest  payment on any Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. ), and other amounts owing, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is responsible for collecting all payments due from the BorrowerBorrowerPerson who is the obligor per the Note. in accordance with the terms and conditions of the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , Loan Agreement, and other Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. , including the following:

  • reimbursement of all amounts disbursed by Fannie Mae under either:
    • its Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. or its MBSMBSMortgage-Backed Security issued as Credit Enhancement; and
    • the Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. evidencing or securing the Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. or any other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. for the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. ;
  • the Facility FeeFacility FeeFor Bond Credit Enhancements, per Part XIV of the DUS Guide. and the Activity FeeActivity FeeFor Bond Credit Enhancements, see Part XIV of the DUS Guide. ;
  • all amounts required to be paid by BorrowerBorrowerPerson who is the obligor per the Note. to fully replenish the PRFPRFPrincipal Reserve Fund for Bond Credit Enhancements, see Part XIV of the DUS Guide.  following any use of funds in the PRFPRFPrincipal Reserve Fund for Bond Credit Enhancements, see Part XIV of the DUS Guide.  by the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. ;
  • any Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or other Termination Fee payable by the BorrowerBorrowerPerson who is the obligor per the Note. with the prepayment of a Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. ; and
  • any other fees, expenses, or reimbursements required to be made by the BorrowerBorrowerPerson who is the obligor per the Note. under the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. .

2.  Calculate Amounts Owing

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must immediately invoice the BorrowerBorrowerPerson who is the obligor per the Note. upon receipt from Fannie Mae of the information the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). requires to calculate amounts owing from the BorrowerBorrowerPerson who is the obligor per the Note. under the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. or any other Loan Agreement evidencing or securing the Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. .  Upon receipt from the BorrowerBorrowerPerson who is the obligor per the Note. , the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must remit the funds to the appropriate parties in accordance with the timing and terms of the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. or the applicable Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. .

3.  Notification of Fannie Mae Advanced Funds

Fannie Mae will notify the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). on or after each date on which Fannie Mae disburses funds, of the amount disbursed, under any:

  • Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. ;
  • Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. evidencing or securing a Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. or any other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. for BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. ; or
  • Credit Enhancement for any Interest Rate HedgeInterest Rate HedgeInterest rate agreement between the Borrower and a hedge provider for which the Borrower receives payments at the end of each period when the interest rate exceeds the Cap Strike Rate.  The Interest Rate Cap provides a ceiling (or cap) on the Borrower’s interest payments on the Mortgage Loan. , including any Swap Collateral Agreement, Interest Rate Swap Credit Enhancement Instrument, or Interest Rate Swap Credit Support Annex.

4.  Collection from Borrower of Fannie Mae Advanced Funds

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must collect from the BorrowerBorrowerPerson who is the obligor per the Note. and immediately remit to Fannie Mae funds equal to:

  • the amount provided by Fannie Mae in connection with any Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. or any Credit Enhancement for an Interest Rate HedgeInterest Rate HedgeInterest rate agreement between the Borrower and a hedge provider for which the Borrower receives payments at the end of each period when the interest rate exceeds the Cap Strike Rate.  The Interest Rate Cap provides a ceiling (or cap) on the Borrower’s interest payments on the Mortgage Loan. ; and/or
  • the Activity FeeActivity FeeFor Bond Credit Enhancements, see Part XIV of the DUS Guide. with respect to the related Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. , to the extent that the BorrowerBorrowerPerson who is the obligor per the Note. does not fully reimburse Fannie Mae by 2:00 p.m. Eastern Time, on the date on which Fannie Mae provided the funds in connection with such Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. or such Credit Enhancement for an Interest Rate HedgeInterest Rate HedgeInterest rate agreement between the Borrower and a hedge provider for which the Borrower receives payments at the end of each period when the interest rate exceeds the Cap Strike Rate.  The Interest Rate Cap provides a ceiling (or cap) on the Borrower’s interest payments on the Mortgage Loan. .
107.01C

Other Fees

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must collect from the BorrowerBorrowerPerson who is the obligor per the Note. and remit to Fannie Mae:

  • any other fees, expenses, or additional costs due from the BorrowerBorrowerPerson who is the obligor per the Note. to Fannie Mae under each Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. , each Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the obligations under the Loan Documents. , the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , or any other Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. ; and
  • any other amounts due pursuant to written communication from Fannie Mae or the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. .
107.01D

Timing of Payments

When the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). receives payment from the BorrowerBorrowerPerson who is the obligor per the Note. with respect to the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , Loan Agreement, or any Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. , the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must remit such payment as directed by Fannie Mae.

If payment is not provided to Fannie Mae or the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. until the next Business DayBusiness DayAny 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, a day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. , the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must invest the funds overnight and remit all investment earnings to Fannie Mae or the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. with the payment; provided, however, that the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). is only required to use its best efforts to so invest any payments received after 4:00 p.m. Eastern Time.

107.01E

Principal Reserve Fund

For each Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. , the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor the PRFPRFPrincipal Reserve Fund for Bond Credit Enhancements, see Part XIV of the DUS Guide.  amount and the Interest Reserve RequirementInterest Reserve RequirementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , if any, under the BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Indenture.

Notwithstanding any provision in the Reimbursement AgreementReimbursement AgreementFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , Loan Agreement, or any other Loan DocumentLoan DocumentAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. , no withdrawal from a PRFPRFPrincipal Reserve Fund for Bond Credit Enhancements, see Part XIV of the DUS Guide.  may be made without the prior written consent of Fannie Mae.

If any withdrawal is made from the PRFPRFPrincipal Reserve Fund for Bond Credit Enhancements, see Part XIV of the DUS Guide. , including any reimbursement to Fannie Mae for amounts paid by Fannie Mae under the Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. or Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan underwritten and serviced by the Lender and financed by the issuance of Bonds where Fannie Mae is providing a Credit Enhancement Instrument. Documents, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must collect the amount of such withdrawal from the BorrowerBorrowerPerson who is the obligor per the Note. .

107.02

Security Instrument; Collateral Agreements; Uniform Commercial Code Filings

107.02A

General

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor the Borrower'sBorrower'sPerson who is the obligor per the Note. continued compliance with the requirements of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the obligations under the Loan Documents. and any other Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. .

107.02B

Cash Collateral Agreement

Upon request, the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must notify Fannie Mae regarding the status of the investment of the cash collateral posted under any Collateral AgreementCollateral AgreementAgreement under which collateral (other than the Property) may be pledged, transferred, or otherwise provided to secure the Borrower’s obligations under a Mortgage Loan. .  The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor and ensure that any control agreement required to perfect Fannie Mae’s security interest in such pledged collateral remains in full force and effect.

107.02C

Investment of Collateral

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must perform reasonable servicing functions, as directed by Fannie Mae, with respect to any Security Agreement.  The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). acknowledges and agrees, however, that the ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). has no discretion to direct investment, application, or release of the collateral under any Security Agreement except upon express written authorization and direction from Fannie Mae.

107.02D

Monitoring Uniform Commercial Code Filings

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must monitor and ensure that all UCCUCCUniform Commercial Code filings for Fannie Mae in connection with Loan DocumentsLoan DocumentsAll documents evidencing, securing, or guaranteeing the debt obligation executed for a Mortgage Loan and approved by Fannie Mae. or related BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Documents are continued, prior to their expiration, in accordance with the requirements of the jurisdiction in which they are filed.

The ServicerServicerPrimary Person responsible for servicing the Mortgage Loan (e.g.,  the originator, the selling Lender, or a third-party servicer). must provide each Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. with written notice of the need to file continuation statements for all UCCUCCUniform Commercial Code  filings for the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. for the benefit of Fannie Mae no later than 90 days prior to the expiration of the UCCUCCUniform Commercial Code filings, and must actively, diligently, and persistently seek to obtain confirmation from each Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. that the requisite continuation statements have been filed prior to the expiration of the UCCUCCUniform Commercial Code filings.

107.03

Remarketing Agent Changes

Fannie Mae must approve any change in the Remarketing AgentRemarketing AgentFor Bond Credit Enhancements, see Part XIV of the DUS Guide. if Fannie Mae is providing Bond Liquidity support for an existing variable rate BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. or for index or reset rate BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. subject to remarketing on certain scheduled mandatory tender and remarketing dates.

To request approval of a new Remarketing AgentRemarketing AgentFor Bond Credit Enhancements, see Part XIV of the DUS Guide. , the LenderLenderPerson approved by Fannie Mae to sell or service Mortgage Loans. must submit to LenderLenderPerson approved by Fannie Mae to sell or service Mortgage Loans.  Risk Management and Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at [email protected]  the following information regarding the proposed Remarketing AgentRemarketing AgentFor Bond Credit Enhancements, see Part XIV of the DUS Guide. :

  • annual financial statements for the most recent fiscal year;
  • description of the operation, knowledge, and experience in public finance and tax-exempt markets, including experience in remarketing variable-rate demand BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. ;
  • current weekly variable-rate demand BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. remarketing book, including dollar amount; and
  • description of any failed remarketings.

The proposed Remarketing AgentRemarketing AgentFor Bond Credit Enhancements, see Part XIV of the DUS Guide. should:

  • currently remarket at least $250 million of weekly variable-rate demand BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. ;
  • have experience continuously remarketing weekly variable-rate demand BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. for the past 3 years;
  • have a minimum net worth of $5 million; and
  • have a minimum broker line of credit sufficient for warehousing $100 million of rated BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. at any time.
  • Email Us
  • Legal
  • Privacy
  • © 2021 Fannie Mae