Property Inspection Protocols
The frequency of required 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). inspections depends on the following:
- 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. ’s Fannie Mae risk rating;
- 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. amount at the Mortgage Loan Origination DateMortgage Loan Origination DateDate you fund a Mortgage Loan to the Borrower. ; and
- other criteria outlined in the table below.
PROPERTY INSPECTION PROTOCOL |
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Protocol if Original Mortgage Loan Amount is Greater than $30 million |
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Mortgage Loan Type |
Fannie Mae Mortgage Loan Rating |
Inspection Frequency |
Min % of Total Units to be Inspected1 |
Min/Max Number of Units to be Inspected2 |
Min Required Photos |
Third-Party or In-House Inspector |
All Mortgage Loans, other than Seniors Housing Mortgage Loans and Mortgage Loans secured by Rent-Stabilized Properties |
Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful |
Annual Full Inspection |
10% |
10/20 | 15 | In-House Only | |
Seniors Housing Mortgage Loans
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Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful |
Annual Full Inspection |
10% |
10/20 |
15 |
In-House Only | |
Mortgage Loans secured by Rent-Stabilized Properties |
Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful | Annual Full Inspection | 10% | 10/20 | 15 | In-House Only | |
Protocol if Original Mortgage Loan Amount is Greater than $6 million and up to $30 million | ||||||
(NOTE: When the inspection protocol below is based, in part, on the DSCR, the DSCR must be based on the most recent annual financial statement submitted to Fannie Mae. A Property with a most recent inspection rating of 4 or 5 must have an Annual Full Inspection, regardless of the DSCR test outlined below.)
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Mortgage Loan Type |
Fannie Mae Mortgage Loan Rating |
Inspection Frequency |
Min % of Total Units to be Inspected1 |
Min/ Max Number of Units to be Inspected2 |
Min Required Photos |
Third-Party or In-House Inspector |
All Mortgage Loans other than Seniors Housing Mortgage Loans and Mortgage Loans secured by Rent-Stabilized Properties |
Pass or Special Mention; DSCRDSCROn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Preferred Equity payments. > 1.35 or Co-op DSCRDSCROn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Preferred Equity payments. > 1.00 |
Full Inspection every 2 years; Annual Full Inspection if current year DSCRDSCROn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Preferred Equity payments. not available |
5% |
5/15 |
15 |
Third-Party or In-House |
Pass or Special Mention; DSCRDSCROn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Preferred Equity payments. < 1.35 or Co-op DSCRDSCROn an annual basis or any specified period, the ratio of Net Cash Flow to the total of: principal, interest, and required Mezzanine Financing or Hard Preferred Equity payments. < 1.00 |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House | |
Substandard or Doubtful |
Annual Full Inspection |
10% |
10/20 |
15 |
In-House Only | |
Seniors Housing Mortgage Loans |
Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful |
Annual Full Inspection |
10% |
10/20 |
15 |
In-House Only | |
Mortgage Loans secured by Rent-Stabilized Properties |
Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful | Annual Full Inspection | 10% | 10/20 | 15 | In-House Only | |
All Maturing Mortgage Loans |
All Ratings |
Full Inspection due within the 12 months prior to Maturity DateMaturity DateDate all amounts due and owing under the Mortgage Loan become fully due and payable per the Loan Documents. 1,2 |
Follow requirements for applicable 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. type. |
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Protocol if Original Mortgage Loan Amount is $6 million or Less |
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(NOTE: A Property with a most recent inspection rating of 4 or 5 must have an Annual Full Inspection. This does not apply to any Mortgage Loan with an original principal amount of less than $750,000) | ||||||
Mortgage Loan Type |
Fannie Mae Mortgage Loan Rating |
Inspection Frequency |
Min % of Total Units to be Inspected1 |
Min/Max Number of Units to be Inspected2 |
Min Required Photos |
Third-Party or In-House Inspector |
All Mortgage Loans other than Seniors Housing Mortgage Loans and Mortgage Loans secured by Rent-Stabilized Properties |
Pass or Special Mention, and original 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. amount < $750,000 |
Walk Around every 5 years |
N/A |
N/A |
10 |
Third-Party or In-House |
Pass or Special Mention, and original 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. amount > $750,000 |
Full Inspection every 2 years |
5% |
2/5 |
10 |
Third-Party or In-House | |
Substandard or Doubtful |
Annual Full Inspection |
10% |
2/5 |
10 |
In-House Only | |
Seniors Housing Mortgage Loans |
Pass or Special Mention |
Annual Full Inspection |
5% |
5/15 |
15 |
Third-Party or In-House |
Substandard or Doubtful |
Annual Full Inspection |
10% |
10/20 |
15 |
In-House Only | |
Mortgage Loans secured by Rent-Stabilized Properties | Pass or Special Mention | Annual Full Inspection | 5% | 5/15 | 15 | Third-Party or In-House |
Substandard or Doubtful | Annual Full Inspection | 10% | 10/20 | 15 | In-House Only | |
All Maturing Mortgage Loans |
All Ratings |
Full Inspection due within 12 months prior to Maturity DateMaturity DateDate all amounts due and owing under the Mortgage Loan become fully due and payable per the Loan Documents. 3 |
Follow requirements for applicable 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. type. |
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1 The number of units to be inspected based on the Minimum Percentage Requirement should not exceed the Maximum Number of Units.
2 For a Property with 10 units or less, the minimum number of units to be inspected is 2 units. This minimum unit count is for occupied and vacant units. If the Property contains any “down” units, then all “down” units must be inspected in addition to the occupied and vacant units.
3 If the next scheduled inspection due date for a Property is less than six months prior to the Maturity Date, then the next scheduled inspection due date shall be that date which is six months prior to the Maturity Date.
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NOTE: If a Property consists of Non-Contiguous Parcels or scattered sites:
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