Chapter 4

Asset Management: Loan Document Administration

Section 401

Servicing Requirements
Section 402

Delegation of Decision-Making Authority; Retention of Outside Legal Counsel
Section 403

Execution of Documents by Servicer – Limited Power of Attorney

Fannie Mae may provide the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. with 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. conferring the right to execute certain documents as attorney-in-fact on behalf of Fannie Mae.  If granted, the actions authorized in the 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. will be specifically limited, and allow the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to execute only those documents listed in the 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. .  To exercise the 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. the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must execute documents as “[Name of Servicer], as Attorney-in-Fact for Fannie Mae”.  The Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. designation as attorney-in-fact will be subject to review and renewal, and the power granted under the 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. may be revoked by Fannie Mae at any time.  Requests for new and replacement 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. should be submitted through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. or as required by Part V, Chapter 4: Asset Management: Loan Document Administration, Section 401.01: General.  As each 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. expires on a specified date according to its terms, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must monitor the expiration date and request a new 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. at least 30 days prior to the expiration date.

Section 404

Execution of Documents by Fannie Mae
Section 405

Fees Due to Fannie Mae

Certain fees may be due to Fannie Mae in connection with a BorrowerBorrowerPerson who is the obligor per the Note. servicing request.  The specified fees are for typical requests; however, higher fees may be required for complicated or non-standard requests, or for other matters not specified in this Chapter.  No later than 10 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, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. following receipt of any fee by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit to Fannie Mae, by wire transfer of immediately available funds, Fannie Mae’s portion of the fee.  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit the wire transfer confirmation number, wire date, and wire amount through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. immediately following each funds transfer, as follows:

ABA Number:  021 039 500

Telegraphic Abbreviation:  FNMA/NYC

Account Number:  169220242

Note:  Type of fee (e.g., Assumption/Transfer),

Fannie Mae Loan Number and Property Name

Attention:  Trans code 507 - GL 747669921.

Section 406

Follow-Up Actions by the Servicer

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must take all applicable actions required to fully effectuate the transaction, including:

  • amending the recorded Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. or filed Uniform Commercial Code (UCCUCCUniform Commercial Code ) financing statements;
  • updating the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). survey;
  • obtaining an endorsement to the mortgagee’s title insurance policy showing no impairment of Fannie Mae’s LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. position, and dating down title to reflect any recorded amendment to the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. ;
  • recording all applicable documents, and sending the required documents through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. ;
  • sending an executed original copy of any new or amended Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. to Multifamily Certification and CustodyMultifamily Certification and CustodyTeam responsible for taking custody of and certifying Mortgage Loans that can be contacted at  multifamcert_team@fanniemae.com, (800) 940-4646, or for submissions:  Fannie Mae (Multifamily) Certification and Custody 21240 Ridgetop Circle Suite 125-130 Sterling, VA  20166. within 15 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, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. ;
  • following the requirements of Part V, Chapter 3: Custodial Accounts, Section 301: Generally if changes are required to any existing Collateral Agreement Custodial AccountCollateral Agreement Custodial AccountCustodial account established by the Servicer for depositing funds received from the Borrower for Collateral Agreements. , or if any new Collateral Agreement Custodial AccountCollateral Agreement Custodial AccountCustodial account established by the Servicer for depositing funds received from the Borrower for Collateral Agreements. must be established in connection with the transaction;
  • retaining copies of all documents, correspondence, and any internal notes or analysis relating to the transaction in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. ; and
  • taking any other actions the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. or its legal counsel determines are necessary.
Section 407

Subordinate Financing
Section 408

Administration of Collateral Agreements
Section 409

Interest Rate Hedge Requirements
Section 410

Ground Leases

If the BorrowerBorrowerPerson who is the obligor per the Note. owns a LeaseholdLeaseholdProperty held under a long-term lease or Ground Lease. interest in the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:

  • ensure that the BorrowerBorrowerPerson who is the obligor per the Note. complies with all provisions of the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. that relate to the Ground LeaseGround LeaseContract for the rental of land, usually on a long term basis. ;
  • if the Ground LeaseGround LeaseContract for the rental of land, usually on a long term basis. payments are escrowed, collect monthly payments from the BorrowerBorrowerPerson who is the obligor per the Note. to ensure sufficient funds will be available to pay the ground rents and any special payments required by the Ground LeaseGround LeaseContract for the rental of land, usually on a long term basis. ; and
  • hold any escrowed ground rent payments with the Borrower’sBorrower’sPerson who is the obligor per the Note. other T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. escrow funds in a T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. or a separate Custodial AccountCustodial AccountAccounts established by the Servicer for depositing P&I payments, T&I funds, Collateral Agreement deposits, and other similar funds. that meets all requirements of Part V, Chapter 3: Custodial Accounts.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for any losses incurred by Fannie Mae if the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. fails to make timely ground rent payments.  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately submit a Non-Monetary Default Borrower Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. for any Ground LeaseGround LeaseContract for the rental of land, usually on a long term basis. default. 

Section 411

Notice of Lien or Noncompliance with Applicable Laws, Ordinances and Regulations

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for protecting the LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. priority of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , and must:

  • take all reasonable actions to prevent the filing of any LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. that would prime the LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. ;
  • immediately notify Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at drawer_am@fanniemae.com. , in writing, upon learning of any such LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. filing, including a recommendation for resolving the situation; and
  • submit a Non-Monetary Default Borrower Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. , if:
    • the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is aware of any material violation by the BorrowerBorrowerPerson who is the obligor per the Note. or PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). manager of any applicable law, ordinance, regulation, or other legal requirement; or
    • the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). is not in compliance with any applicable law, ordinance, regulation, or other legal requirement, including, without limitation, any relating to:
      • Fair Housing Act;
      • Americans with Disabilities Act;
      • non-discrimination;
      • environmental hazards;
      • occupancy;
      • zoning and land use;
      • health, fire, and building codes relating to immediately hazardous conditions; and
      • illegal use of the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). .

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must also provide to Fannie Mae all information concerning any lawsuit, cause of action, or claim by any third party resulting from or relating to the violation. 

Section 412

Property Forfeitures and Seizures

Various federal and state statutes provide for the civil or criminal forfeiture of certain types of property, including real estate that is used, or intended to be used, to commit or facilitate the commission of certain violations of law.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must not provide any information about the BorrowerBorrowerPerson who is the obligor per the Note. , 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 PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). , any Key PrincipalKey PrincipalPerson who controls and/or manages the Borrower or the Property, is critical to the successful operation and management of the Borrower and the Property, and/or may be required to provide a Guaranty. , or any PrincipalPrincipalPerson who owns or controls, in the aggregate, directly or indirectly (together with that Person's Immediate Family Members, if an individual), specified interests in the Borrower per Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 303: Key Principals, Principals,… directly to any federal or state agency unless Fannie Mae specifically authorizes the release of the information.  Following any contact from a federal or state official, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately contact Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at drawer_am@fanniemae.com. and Multifamily Special Asset ManagementMultifamily Special Asset ManagementTeam performing Fannie Mae’s Special Servicing that can be contacted at multifamily_sam@fanniemae.com. .  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should describe in its communication the nature of the contact, the information requested, and any document or papers received by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in connection with the contact.  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must continue to 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. .

Section 413

Property and Liability Insurance
Section 414

Casualty Losses – Performing Mortgage Loans
Section 415

Casualty Losses – Non-Performing Mortgage Loans

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact Multifamily Special Asset ManagementMultifamily Special Asset ManagementTeam performing Fannie Mae’s Special Servicing that can be contacted at multifamily_sam@fanniemae.com.  before performing a casualty loss assessment on a PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). securing a Non-Performing Mortgage LoanNon-Performing Mortgage LoanMortgage Loan with an uncured default. .  Fannie Mae will determine whether the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should proceed with the assessment, and direct the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. accordingly.  Any activity or action plans to repair or restore the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). must be approved by Fannie Mae.  All insurance loss drafts and checks must be forwarded to Fannie Mae for endorsement and disposition.

Section 416

Credit Facilities and Bulk Deliveries
416.01

General

Each Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. and Bulk DeliveryBulk DeliveryStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. transaction is different, therefore the requirements in this Section may not apply to every transaction.  For specific requirements, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must refer to the applicable:

  • Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. ;
  • Bulk Delivery Agreement; and
  • other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
416.02

Delegation of Decisions

Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. and Bulk DeliveryBulk DeliveryStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. requests are delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. as follows.

416.02A

Decisions and Actions Not Delegated

Decisions and actions that are not delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for 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. generally per Part V, Chapter 4: Asset Management: Loan Document Administration, Section 402.01: Delegation of Decision-Making Authority, are also not delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for 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 a Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. or Bulk DeliveryBulk DeliveryStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. .  Additionally, decisions and actions are not delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. if the request involves:

  • amendments or changes to the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. , Bulk Delivery Agreement, or equivalent agreement, except for the Fannie Mae standard form Amendment for:
    • Completion/Repair extensions; and
    • changes to the monthly Replacement ReserveReplacement ReserveCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. deposits;
  • a Bulk DeliveryBulk DeliveryStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. substitution; or
  • a Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. :
    • collateral release or substitution;
    • future advance and conversion;
    • revaluation and determination of the Allocable Facility AmountAllocable Facility AmountFor a Credit Facility, the amount of debt allocated to a given Property, used in calculating tests for collateral activity such as releases, substitutions, and additions. ;
    • Interest Rate HedgeInterest Rate HedgeInterest rate agreement between the Borrower and a 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 Mortgage Loan interest payments. renewal or modification;
    • DefeasanceDefeasanceTransaction where a Property is released from the lien of the Security Instrument and the Lender receives a valid and perfected lien and security interest in substitute collateral acceptable to Fannie Mae and the cash flows thereunder. ;
    • payoff/termination;
    • Ground LeaseGround LeaseContract for the rental of land, usually on a long term basis. or operating lease modification;
    • Transfer/AssumptionTransfer/AssumptionTransaction changing the ownership of the Borrower or Property. ;
    • PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). manager or operator change;
    • re-underwriting assessment; or
    • Springing Debt Service ReserveSpringing Debt Service ReserveSpringing Debt Service Reserve per the Master Credit Facility Agreement that a Borrower may be required to fund in the event of a Springing Trigger. .
416.02B

Decisions Delegated by the Delegated Transaction Form 4636 series

Decisions and actions covered by the Delegated Transaction FormsDelegated Transaction FormsMultifamily Asset Management Delegated Transaction Form (Form 4636 series) used to determine whether certain asset management requests from a Borrower are delegated to the Servicer. (Form 4636 series) are delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. per the applicable Form 4636 series.  For these requests, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit the completed Delegated Transaction FormDelegated Transaction FormMultifamily Asset Management Delegated Transaction Form (Form 4636 series) used to determine whether certain asset management requests from a Borrower are delegated to the Servicer. (Form 4636 series) through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. .

416.02C

Other Delegated Decisions

Decisions and actions delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for 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. generally perPart V, Chapter 4: Asset Management: Loan Document Administration, Section 402.01: Delegation of Decision-Making Authority are also delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for 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 a Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. or a Bulk DeliveryBulk DeliveryStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. .  Additionally, decisions and actions not covered by the Delegated Transaction FormsDelegated Transaction FormsMultifamily Asset Management Delegated Transaction Form (Form 4636 series) used to determine whether certain asset management requests from a Borrower are delegated to the Servicer. (Form 4636 series) are delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. per this Chapter for:

  • Bulk Delivery Additions, Releases, and Supplemental Mortgage LoansSupplemental Mortgage LoansMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. ;
  • Amendment to Multifamily Loan and Security Agreement (Restoration Reserve) (Form 6615) or Insurance Loss Proceeds Collateral Agreements (Form 6639);
  • endorsing insurance checks;
  • extensions to complete Completion/RepairsCompletion/RepairsRepairs or capital item replacements and deferred maintenance: identified per the Property Condition Assessment; and required per the Completion/Repair Schedule, or Completion/Repair Agreement. ;
  • changes to the monthly Replacement ReserveReplacement ReserveCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. deposits; and
  • administering:
    • escrow accounts; and
    • Collateral AgreementsCollateral AgreementsAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .

If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is unsure if a decision is delegated, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact Multifamily Structured Asset ManagementMultifamily Structured Asset ManagementTeam that can be contacted at structured_am@fanniemae.com. before proceeding. 

416.03

Approval Requests

If Fannie Mae approval is required, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a request through DUS GatewayDUS GatewayMultifamily pre-acquisition system, or any successor systems, recording deal registration, Pre-Review and/or waiver tracking, Mortgage Loan Commitments, and decision records. or the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. and include:

  • the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. recommendation;
  • any supporting documentation (including references to the relevant sections of the governing documents); and
  • the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. analysis supporting its recommendation.
416.04

Credit Facility Release and Substitution Requests

If permitted by the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. and other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , BorrowersBorrowersPerson who is the obligor per the Note. may be allowed to release or substitute collateral.  These requests must follow the provisions of the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , and approval is not delegated to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .

The BorrowerBorrowerPerson who is the obligor per the Note. must initiate the release/substitution process by submitting a written request to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .  Upon receipt, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a release/substitution request package through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. that includes:

  • the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. summary of the Borrower'sBorrower'sPerson who is the obligor per the Note. release/substitution request, and its recommendation regarding approval of the requested release/substitution;
  • any waiver requests and the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. recommendation for approval of each waiver;
  • when the BorrowerBorrowerPerson who is the obligor per the Note. expects the release/substitution to close;
  • whether the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). meets all conditions and compliance tests (e.g., LTVLTVRatio of the actual aggregate UPB of the Mortgage Loan, plus any Pre-Existing Mortgage Loans, plus any Hard Pay Preferred Equity, plus any Mezzanine Financing, to the value of the Property, expressed as a percentage.  , 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 Pay Preferred Equity payments. , UPBUPBUnpaid Principal Balance , geographic/asset concentration) per the applicable Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ;
  • the release price and calculations (per the terms of the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. and other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. );
  • the Allocable Facility AmountAllocable Facility AmountFor a Credit Facility, the amount of debt allocated to a given Property, used in calculating tests for collateral activity such as releases, substitutions, and additions. of each PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). after the release;
  • the amount of the release/substitution fees to be collected;
  • whether a prepayment or advance of funds will occur;
  • the Structured Facilities Monitoring Spreadsheet (Form 4802) showing 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. level and collateral level data for the Structured Transaction both before and after the release/substitution occurs;
  • third-party reports; and
  • any other items required by the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .

If a Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. or cash collateral is required for the request, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must enter 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 cash collateral information in MSFMSMSFMSMultifamily Structured Facilities Management System performing collateral delivery and securitization functions for Structured Transactions. .  Any Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. must comply with Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit, and original Letters of CreditLetters of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. must be sent to Multifamily Structured AcquisitionsMultifamily Structured AcquisitionsTeam that can be contacted at mf_spot@fanniemae.com. .

If the request is approved, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:

  • submit its payoff calculations to Multifamily Structured AcquisitionsMultifamily Structured AcquisitionsTeam that can be contacted at mf_spot@fanniemae.com. ;
  • release the collateral from the MSFMSMSFMSMultifamily Structured Facilities Management System performing collateral delivery and securitization functions for Structured Transactions. system; and
  • if necessary, release, update, and verify any associated interest rate hedges in MSFMSMSFMSMultifamily Structured Facilities Management System performing collateral delivery and securitization functions for Structured Transactions. .
416.05

Credit Facility Future Advance and Conversion Requests

If permitted by the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. and other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , the BorrowerBorrowerPerson who is the obligor per the Note. may be allowed to:

  • obtain a future advance (addition, borrow up, substitution advance, or tranche refinance); or
  • convert a 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. from variable to fixed rate.

The BorrowerBorrowerPerson who is the obligor per the Note. must initiate the process by submitting a written request to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .  Upon receipt, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a request package through DUS GatewayDUS GatewayMultifamily pre-acquisition system, or any successor systems, recording deal registration, Pre-Review and/or waiver tracking, Mortgage Loan Commitments, and decision records. including:

  • the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. summary of the Borrower’sBorrower’sPerson who is the obligor per the Note.  request and its recommendation for approval;
  • any waiver requests and the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. recommendation for approval of each waiver;
  • the amount of the transaction and the supporting underwriting spreadsheets and calculations (per the terms of the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. and other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. );
  • when the BorrowerBorrowerPerson who is the obligor per the Note. expects the transaction to close;
  • whether the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). meets all conditions and compliance tests (e.g., LTVLTVRatio of the actual aggregate UPB of the Mortgage Loan, plus any Pre-Existing Mortgage Loans, plus any Hard Pay Preferred Equity, plus any Mezzanine Financing, to the value of the Property, expressed as a percentage.  , 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 Pay Preferred Equity payments. , UPBUPBUnpaid Principal Balance , geographic/asset concentration) per the applicable Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ;
  • a quote sheet;
  • any applicable Sources and Uses statement;
  • any applicable Interest Rate HedgeInterest Rate HedgeInterest rate agreement between the Borrower and a 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 Mortgage Loan interest payments. requirements;
  • the Allocable Facility AmountAllocable Facility AmountFor a Credit Facility, the amount of debt allocated to a given Property, used in calculating tests for collateral activity such as releases, substitutions, and additions.  of each PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). after the transaction;
  • itemized fees associated with the transaction;
  • the Structured Facilities Monitoring Spreadsheet (Form 4802) showing 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. level and collateral level data for the Structured Transaction both before and after the transaction occurs;
  • any applicable third-party reports; and
  • any other items required by the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
416.06

Credit Facility Revaluations

Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. revaluations may occur per the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility. .

The LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must retain an AppraiserAppraiserPerson engaged to estimate a Property’s market value per USPAP. to obtain a Capitalization Rate DerivationCapitalization Rate DerivationIndependent determination of the appropriate capitalization rate for a specific Property. per Section 106 of the Instructions for Appraisers (Form 4827) if:

  • the PropertiesPropertiesMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). are being revalued with the intent to fund a new 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. ; or
  • no new 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. is being funded, but:
    • the previous valuation is more than 3 years old;
    • the Lender'sLender'sPerson Fannie Mae approved to sell or service Mortgage Loans. recommended capitalization rate is more than 50 bps less than the previously approved cap rate; or
    • required by Fannie Mae.

After Fannie Mae notifies the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. of the final capitalization rate determination and valuation, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:

  • promptly notify the BorrowerBorrowerPerson who is the obligor per the Note. of the:
    • revised capitalization rates;
    • PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). values;
    •  Allocable Facility AmountsAllocable Facility AmountsFor a Credit Facility, the amount of debt allocated to a given Property, used in calculating tests for collateral activity such as releases, substitutions, and additions. ;
    •  LTVLTVRatio of the actual aggregate UPB of the Mortgage Loan, plus any Pre-Existing Mortgage Loans, plus any Hard Pay Preferred Equity, plus any Mezzanine Financing, to the value of the Property, expressed as a percentage.  ; and
    •  any failure to meet compliance tests, if applicable; and
  • retain a copy of the BorrowerBorrowerPerson who is the obligor per the Note. notification in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. .
416.07

Credit Facility Supplemental Mortgage Loans Not Permitted

Supplemental Mortgage LoansSupplemental Mortgage LoansMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. on PropertiesPropertiesMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). within a Credit FacilityCredit FacilityStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. are not permitted unless expressly authorized under the Master Credit Facility AgreementMaster Credit Facility AgreementAgreement evidencing the terms and conditions of a Credit Facility.  and other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact Multifamily Structured Asset ManagementMultifamily Structured Asset ManagementTeam that can be contacted at structured_am@fanniemae.com. before underwriting a Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. .

416.08

Additional Information

For any issue not covered in this Section, or if the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. requires a more detailed explanation, contact Multifamily Structured Asset ManagementMultifamily Structured Asset ManagementTeam that can be contacted at structured_am@fanniemae.com. .

Section 417

Seniors Housing Properties
Section 418

Credit Enhancement Mortgage Loans and Multifamily Affordable Housing Properties
418.01

Bond Transactions and Credit Enhancement Mortgage Loans

For any Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan financed by a Bond issuance where Fannie Mae provides credit enhancement by a Credit Enhancement Instrument, or an MBS for Bonds. where Fannie Mae is providing credit enhancement for tax-exempt multifamily housing 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 BorrowerBorrowerPerson who is the obligor per the Note. must provide the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. with a copy of the compliance monitoring statement required under the Bond Documents.  If the Borrower’sBorrower’sPerson who is the obligor per the Note. statement reflects noncompliance with the low- and moderate-income tenant occupancy requirements set forth in the Affordable Regulatory AgreementAffordable Regulatory AgreementRegulatory, land use, extended use, or similar agreement or recorded restriction limiting rents, imposing maximum income restrictions on tenants, or placing other affordability restrictions on the use or occupancy of the Property (whether imposed by a government entity or self-imposed by a Borrower…, or if the BorrowerBorrowerPerson who is the obligor per the Note. fails to provide the statement to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must notify Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at drawer_am@fanniemae.com. , and retain the compliance monitoring statement in its Servicing FileServicing FileYour file for each Mortgage Loan serviced. .

418.02

Compliance Issues Relative to Bond Credit Enhancement Transactions

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must monitor the Interest Reserve Requirement, if any, under the Bond Trust Indenture with respect to each Credit Enhancement Mortgage LoanCredit Enhancement Mortgage LoanMortgage Loan financed by a Bond issuance where Fannie Mae provides credit enhancement by a Credit Enhancement Instrument, or an MBS for Bonds. .

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must monitor the rating of the institution in which the accounts under any Cash Management, Security, Pledge, and Assignment Agreement are held, and must require the BorrowerBorrowerPerson who is the obligor per the Note. to move the accounts if the rating no longer meets Fannie Mae’s requirements as provided in Part V, Chapter 3: Custodial Accounts.

418.03

Monitoring Compliance; Notification of Noncompliance
418.04

Multifamily Affordable Housing (MAH) Properties

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must collect annual compliance documentation in the form of:

  • for an MAH PropertyMAH PropertyProperty encumbered by a regulatory agreement, land use restriction agreement, extended use agreement, or similar restriction that limits rents that can be charged to tenants, or imposes income limits on tenants. with Sponsor-Initiated AffordabilitySponsor-Initiated AffordabilityVoluntary rent and income restrictions recorded against the Property by the Borrower to preserve or create multifamily affordable housing. , certifications from the BorrowerBorrowerPerson who is the obligor per the Note. and Administering AgentAdministering AgentThird-party compliance monitoring company. of compliance with the Sponsor-Initiated AffordabilitySponsor-Initiated AffordabilityVoluntary rent and income restrictions recorded against the Property by the Borrower to preserve or create multifamily affordable housing. Agreement; or
  • for any other MAH PropertyMAH PropertyProperty encumbered by a regulatory agreement, land use restriction agreement, extended use agreement, or similar restriction that limits rents that can be charged to tenants, or imposes income limits on tenants. , the annual recertification of the Property’sProperty’sMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). compliance with the Affordable Regulatory AgreementAffordable Regulatory AgreementRegulatory, land use, extended use, or similar agreement or recorded restriction limiting rents, imposing maximum income restrictions on tenants, or placing other affordability restrictions on the use or occupancy of the Property (whether imposed by a government entity or self-imposed by a Borrower… from the agency or entity that imposed any applicable rent or occupancy restrictions or, if not available, an explanation of why it is not available. 

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately submit a Non-Monetary Default Borrower Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. to notify Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at drawer_am@fanniemae.com. if this documentation reveals any event of default or noncompliance with the applicable:

  • Sponsor-Initiated AffordabilitySponsor-Initiated AffordabilityVoluntary rent and income restrictions recorded against the Property by the Borrower to preserve or create multifamily affordable housing. Agreement; or
  • Affordable Regulatory AgreementAffordable Regulatory AgreementRegulatory, land use, extended use, or similar agreement or recorded restriction limiting rents, imposing maximum income restrictions on tenants, or placing other affordability restrictions on the use or occupancy of the Property (whether imposed by a government entity or self-imposed by a Borrower….

 The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must retain the annual compliance documentation in its Servicing FileServicing FileYour file for each Mortgage Loan serviced. .

418.05

Low-Income Housing Tax Credits

If the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). is subject to a Low-Income Housing Tax CreditLow-Income Housing Tax CreditFederal program offering tax credits to owners of eligible properties that contain low-income occupants and rent restrictions. allocation, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must obtain, at least once in each calendar year (and more often if directed by Fannie Mae):

  • copies of the tax and other compliance forms specified in Part III, Chapter 7: Multifamily Affordable Housing Properties; and
  • BorrowerBorrowerPerson who is the obligor per the Note. certifications of the Property’sProperty’sMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). compliance with the requirements of the Internal Revenue Code regarding Low-Income Housing Tax CreditsLow-Income Housing Tax CreditsFederal program offering tax credits to owners of eligible properties that contain low-income occupants and rent restrictions. ; and
  • if the Low-Income Housing Tax CreditsLow-Income Housing Tax CreditsFederal program offering tax credits to owners of eligible properties that contain low-income occupants and rent restrictions. have not yet been syndicated, monthly reports from the BorrowerBorrowerPerson who is the obligor per the Note. detailing the Borrower’sBorrower’sPerson who is the obligor per the Note. progress in syndicating the tax credit allocation until the syndication is completed.

If the BorrowerBorrowerPerson who is the obligor per the Note. indicated that the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). does not comply with all applicable regulatory requirements, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately submit a Non-Monetary Default BorrowerBorrowerPerson who is the obligor per the Note. Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. .  Neither Fannie Mae nor the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for determining or ensuring the Borrower’sBorrower’sPerson who is the obligor per the Note. compliance with Low-Income Housing Tax CreditLow-Income Housing Tax CreditFederal program offering tax credits to owners of eligible properties that contain low-income occupants and rent restrictions. requirements.  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. also must comply with the information requirements of Part III, Chapter 7: Multifamily Affordable Housing Properties.

418.06

Enhanced Resident Services

The BorrowerBorrowerPerson who is the obligor per the Note. must annually recertify the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). and submit each recertification to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. within 75 days following the end of each Loan YearLoan YearPeriod beginning on the date of the Note and ending on the last day of the month that is 12 full months after the date of the Note, and each successive 12-month period thereafter. .  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must collect the initial certification and each recertification in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. .  For any recertification failure, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must promptly notify Fannie Mae through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. , or such other method indicated by Fannie Mae.  Additionally, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must promptly submit a Non-Monetary Default Borrower Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. if the PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). later achieves recertification.  After recertification, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must then resume annual compliance monitoring at the end of each subsequent Loan YearLoan YearPeriod beginning on the date of the Note and ending on the last day of the month that is 12 full months after the date of the Note, and each successive 12-month period thereafter. .

418.07

HAP Contract Approval and Releasing Restabilization Reserve

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is delegated the authority to:

  • approve renewal of the HAPHAPHUD project-based Section 8 rental subsidy in the form of a Housing Assistance Payment contract. ContractContractProgram Documents per the Multifamily Selling and Servicing Agreement. during 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. term; and
  • waive any Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. provision requiring the HAPHAPHUD project-based Section 8 rental subsidy in the form of a Housing Assistance Payment contract. ContractContractProgram Documents per the Multifamily Selling and Servicing Agreement. to be fully funded by HUDHUDU.S. Department of Housing and Urban Development through 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. Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. .

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit through the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. a copy of the renewed HAPHAPHUD project-based Section 8 rental subsidy in the form of a Housing Assistance Payment contract. ContractContractProgram Documents per the Multifamily Selling and Servicing Agreement. , and retain a copy in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. , together with any BorrowerBorrowerPerson who is the obligor per the Note. request for release of the Restabilitzation Reserve.

Most disbursements from a Restabilization Reserve require Fannie Mae’s approval.  The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is delegated the authority to approve, without Fannie Mae’s consent, a BorrowerBorrowerPerson who is the obligor per the Note. request for a final disbursement, provided:

  • the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has received written evidence that the HAPHAPHUD project-based Section 8 rental subsidy in the form of a Housing Assistance Payment contract. contract has been extended by HUDHUDU.S. Department of Housing and Urban Development through the Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. with no material changes to its terms;
  • no default has occurred and is continuing under the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; and
  • the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. explicitly allow a final disbursement under these conditions.
Section 419

Sponsor-Dedicated Workforce Housing Properties

Per the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , to monitor an SDW Housing Property, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:

  • annually review the rent roll and sufficient lease files to determine BorrowerBorrowerPerson who is the obligor per the Note. compliance with the required rent restrictions;
  • receive an annual Supplemental Annual Loan Agreement Certification (Sponsor-Dedicated Workforce Housing) (Form 6620.Supplemental.SDW) from the BorrowerBorrowerPerson who is the obligor per the Note. , and:
    • attest to the Form 6620.Supplemental.SDW that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has audited the rent roll for BorrowerBorrowerPerson who is the obligor per the Note. compliance with the required rent restrictions; or
    • for any noncompliance:
      • notify the BorrowerBorrowerPerson who is the obligor per the Note. of the default; and
      • submit a Non-Monetary Default Borrower Request in the MAMPMAMPMultifamily Asset Management Portal used to submit Property inspections, operating statements, requested modifications, asset management reports, and data corrections for loan or property attributes. ;
  • retain in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. , copies of:
    • Modifications to Multifamily Loan and Security Agreement (Sponsor-Dedicated Workforce Housing) (Form 6271.SDW);
    • Modifications to Security Instrument (Sponsor-Dedicated Workforce Housing) (Form 6325);
    • PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). rent restrictions;
    • annual rent roll and compliance results; and
    • any Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. default BorrowerBorrowerPerson who is the obligor per the Note. notices; and
  • per the Sponsor-Dedicated Workforce (SDW) Housing Job Aid, annually submit copies of the:
    • Form 6620.Supplemental.SDW and ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. attestation; and
    • PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). rent roll.
Section 420

MH Communities with Tenant Site Lease Protections

A 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. secured by an MH CommunityMH CommunityResidential real estate development with lots on which manufactured homes are located, together with amenities, utility services, landscaping, roads, and other infrastructure. with Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… requires additional monitoring.  The Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. require the BorrowerBorrowerPerson who is the obligor per the Note. to annually provide:

  • a certified copy of the current residential MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. form;
  • a certified copy of the notice sent to all MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. tenants if the Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… were implemented by the Rules and Regulations;
  • copies of any actual MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. requested by LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. ; and
  • a certification of the actual percentage of MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeasesLeasesWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. that include all required Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,…, and that no material changes have been made to the MH Community’sMH Community’sResidential real estate development with lots on which manufactured homes are located, together with amenities, utility services, landscaping, roads, and other infrastructure. rules and regulations or to the MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. form.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:

  • confirm the Borrower'sBorrower'sPerson who is the obligor per the Note. ongoing compliance with the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ;
  • if the Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… were implemented within the MH Community’sMH Community’sResidential real estate development with lots on which manufactured homes are located, together with amenities, utility services, landscaping, roads, and other infrastructure. rules and regulations, confirm:
    • the rules and regulations contain all Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… and are publicly posted in the MH CommunityMH CommunityResidential real estate development with lots on which manufactured homes are located, together with amenities, utility services, landscaping, roads, and other infrastructure. ; and
    • each MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. tenant received written notice of all Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… added to the rules and regulations;
  • if the Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… were implemented within the MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. :
    • confirm the MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. form includes:
      • all Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,…; and
      • the required percentage of MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeasesLeasesWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. (i.e., 25%, 50%, or 100%) are covered by the Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,…; and
    • annually audit at least 25% of the minimum percentage of MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeasesLeasesWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. required per the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. (i.e., 25%, 50%, or 100%) to ensure all Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… are included;
  • determine whether the BorrowerBorrowerPerson who is the obligor per the Note. complied with all terms of the Tenant Site Lease ProtectionsTenant Site Lease ProtectionsMH Site Lease with the Homeowner or tenant of a Manufactured Home with: a 1-year renewable (at the MH Site Lease tenant’s election) lease term, unless good cause for nonrenewal exists; a minimum 30-day written notice of rent increases; 5-day minimum grace period for non-payment of rent,… (e.g., the BorrowerBorrowerPerson who is the obligor per the Note. only raised MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. rents after required notice);
  • retain the review of the Borrower'sBorrower'sPerson who is the obligor per the Note. certification and audit results in the Servicing FileServicing FileYour file for each Mortgage Loan serviced. ; and
  • notify Multifamily Loss MitigationMultifamily Loss MitigationTeam that can be contacted at lm_watch@fanniemae.com. if the BorrowerBorrowerPerson who is the obligor per the Note. fails to certify compliance, or the MH SiteMH SiteDeveloped lot within an MH Community on which a Manufactured Home can be located. LeaseLeaseWritten agreement between an owner and the tenant of a Property stipulating the conditions for possession and use of real estate for a specified period of time and rent. audit discloses potential noncompliance.
Section 421

Single Asset Entity Conversion

If the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. require the BorrowerBorrowerPerson who is the obligor per the Note. to convert into a single asset entity that complies with Part I, Chapter 3: Borrower, Guarantor, Key Principals, and Principals, Section 302.01: Single-Asset Entity by a certain date, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is delegated the authority to:

  • grant a one-time extension of the date by up to 90 days;
  • determine whether the extension requires an amendment to the Multifamily Loan AgreementMultifamily Loan AgreementAgreement evidencing Mortgage Loan terms using Form 6001 series Loan Documents, or another Fannie Mae-approved form. ; and
  • document it in any form that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. deems legally enforceable.
Section 422

Loan Document Amendments

Provided the change does not violate the Disclosure DocumentsDisclosure DocumentsDocuments for an Investor for a particular Securitized Mortgage Loan, which may include the MBS Trust Agreement, Prospectus, and any related documents. or the Fannie Mae Master Trust Agreement, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is delegated the authority to modify the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. for a Portfolio Mortgage LoanPortfolio Mortgage LoanMortgage Loan purchased by Fannie Mae and held as of a certain date regardless of whether it is a Cash Mortgage Loan or an MBS Mortgage Loan. to:

  • align with the approved terms for a Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. ; or
  • cross-default and/or cross-collateralize the Portfolio Mortgage LoanPortfolio Mortgage LoanMortgage Loan purchased by Fannie Mae and held as of a certain date regardless of whether it is a Cash Mortgage Loan or an MBS Mortgage Loan. with a subsequent 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. .

This delegated authority includes executing all Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. amendments related to:

  • a subordinate lien, including any 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. modification for a Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. with a confirmed CommitmentCommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. ;
  • cross-collateralizing and/or cross-defaulting a Pre-Existing Mortgage LoanPre-Existing Mortgage LoanMultifamily residential real estate loan secured by Liens against the Property having higher priority than the Lien securing the Subordinate Loan purchased by Fannie Mae. with a Supplemental Mortgage LoanSupplemental Mortgage LoanMortgage Loan purchased by Fannie Mae that is subordinated to, and has a Mortgage Loan Origination Date after, the Senior Mortgage Loan that is also owned by Fannie Mae. with a confirmed CommitmentCommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. ; and
  • cross-collateralizing and/or cross-defaulting a first LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. 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. with another first LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. 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. (e.g., for a phased property), provided that cross-collateralization and cross-default were contemplated in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. for the Portfolio Mortgage LoanPortfolio Mortgage LoanMortgage Loan purchased by Fannie Mae and held as of a certain date regardless of whether it is a Cash Mortgage Loan or an MBS Mortgage Loan. and there is a confirmed CommitmentCommitmentContractual agreement between you and Fannie Mae where Fannie Mae agrees to buy a Mortgage Loan at a future date in exchange for an MBS, or at a specific price for a Cash Mortgage Loan, and you agree to Deliver that Mortgage Loan. for the second first LienLienLien, mortgage, bond interest, pledge, security interest, charge, or encumbrance of any kind. 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 423

Maturing Mortgage Loans