Section 402

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

402.01	Delegation of Decision-Making Authority

Fannie Mae delegates significant decision-making authority and responsibility to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to the extent specified in the Multifamily Asset Management Delegated Transaction Forms (Form 4636 series) (each, the “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. ”), covering the following matters:

Transfers/Assumptions (Form 4636.TA);
Commercial Leases (Form 4636.CL);
Condemnations (Form 4636.C);
Condominium/Cooperative Property Conversions (Form 4636.CC);
Easements (Form 4636.E);
Oil, Gas, or Mineral Rights Leases (Form 4636.OGL);
Partial Releases of Collateral (Form 4636.PR);
Property Management Changes (Form 4636.PM); and
Use Conversions (Form 4636.UC).

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must follow the instructions in the 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. , which will specify which matters are delegated and which are non-delegated. All delegated and non-delegated requests must 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. , with the 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. and the required supporting documents.

A transaction memo must be submitted for any unusual matters not covered in the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. , or matters that could materially affect Fannie Mae’s security interests, investment interests, or the interests of InvestorsInvestorsMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. in Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. . Decision-making authority is more limited for Credit FacilitiesCredit FacilitiesStructured Transaction governed by a Master Credit Facility Agreement requiring Mortgage Loans and Properties to be cross-defaulted, and cross-collateralized. , Bulk DeliveriesBulk DeliveriesStructured Transaction governed by a Bulk Delivery Agreement that allows future: Mortgage Loan additions; and/or Property substitutions. , and certain Seniors HousingSeniors HousingMultifamily residential rental property with any combination of Independent Living, Assisted Living, Alzheimer’s/Dementia Care, or Skilled Nursing units. Loan matters. Neither the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. nor Fannie Mae has the authority to waive any local, state, or federal law or regulation.

402.02	Retention of Outside Legal Counsel

Fannie Mae often retains outside legal counsel to review non-delegated matters or other matters that require Fannie Mae’s legal review. In such instance, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must obtain the BorrowerBorrowerPerson who is the obligor per the Note. ’s written agreement to pay the reasonable legal fees and expenses of Fannie Mae’s counsel before any legal work may commence.

If Fannie Mae outside counsel review is required or requested, the BorrowerBorrowerPerson who is the obligor per the Note. must pay the applicable legal fee, which will either be a fixed fee or an estimated fee depending on the type of request. For an estimated fee request, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must notify the BorrowerBorrowerPerson who is the obligor per the Note. that the actual legal fee may be higher or lower than the estimate, depending on the ultimate scope of the request, and the time needed to resolve the issue.

Fannie Mae will:

apprise the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. of any likely increases in the estimated review fee;
provide the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. the amount of the fee for any fixed fee request; and
provide the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. a summary invoice directly from Fannie Mae’s outside counsel.

Upon receipt of the invoice, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must arrange for payment of Fannie Mae’s legal fees. The legal fee must be collected from the BorrowerBorrowerPerson who is the obligor per the Note. before engaging Fannie Mae outside counsel.