Section 216

DUS Bond Credit Enhancement Transactions – Reporting and Remitting Requirements

The requirements of this Section are applicable to Bond Credit Enhancement Transactions only and the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. reporting, collection, and remitting of prepayments must be done in accordance with the procedures described below.

216.01	Monthly Bond Credit Enhancement Reporting

For reporting purposes, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must segregate its DUS Bond Credit Enhancement portfolio into 2 groups:

DUS Bond Credit Enhancement by Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. and Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. ; or
DUS Bond Credit Enhancement by a SecuritySecurityMBS, PFP MBS, or REMIC. .

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must electronically submit a Credit Enhancement Activity Report (Form 4090) using the Credit Enhancement Servicing and Investor Reporting System (CESIR) for each DUSDUSDelegated Underwriting and Servicing BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. 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. and BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. each month. The date that the Credit Enhancement Activity Report is due is dependent on whether the Mortgage Loan’sMortgage Loan’sMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. monthly P&IP&IPrincipal and interest payments are due on the first of the month or on the 15th of the month.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must register to use CESIRCESIRCredit Enhancement Servicing and Investor Reporting System prior to use. Information regarding registering for CESIRCESIRCredit Enhancement Servicing and Investor Reporting System can be found on https://multifamily.fanniemae.com/applications-technology/cesir.

For most DUS Bond Credit Enhancements, the monthly reporting rule is applied as follows:

If 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. payments are due on the first of the month, the report is due on the fourth calendar day of the month or the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. if the fourth calendar day of the month is not a Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. ; or
If 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. payments are due on the 15th day of the month, the report is due on the 15th calendar day of the same month or the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. if such day is not a Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. .

The monthly report must include:

all scheduled 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. payments to be made by the BorrowerBorrowerPerson who is the obligor per the Note. whether or not such payments are actually made by the BorrowerBorrowerPerson who is the obligor per the Note. ; and
bond redemptions reported by the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. for the current calendar month.

216.02	Monthly Remittance Procedures

216.02A	Monthly Remittances of Scheduled Payments to Bond Trustee

Monthly remittances to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. depend on the execution type for the transaction and applicable transaction requirements.

1. Standby Execution

For StandbyStandbyCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) if the Borrower fails to make required mortgage note payments or if a bankruptcy event has occurred. executions, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must pay the Scheduled Payments (net of the Facility Fee) to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make the payment to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. by wire transfer of same day funds on or before the 5th BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. before the day on which the bond payment is due to be made by the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. to the bondholders. BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. is determined under the Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. for each separate BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. transaction.

For direct pay executions, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must perform the following:

a. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must pay to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , by wire transfer of same day funds on the Bond Payment Date, the following components of the Scheduled Payment:

(1) the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. deposit;

(2) the periodic fees payable to the IssuerIssuerEntity that: issues Bonds for a Credit Enhancement Mortgage Loan; packages mortgages for sale as a Security for an MBS; or issues a Letter of Credit. , Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , Rebate Analyst, any Compliance Monitor, Remarketing AgentRemarketing AgentPerson selected by the Issuer to reset the interest rate on the Bonds in order to resell any Bonds tendered by investors on the interest rate reset date. and Tender Agent and any other similar person; and

(3) any other requirement, as specified in the Reimbursement Agreement.

b. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit the following components of the Scheduled Payment to Fannie Mae in reimbursement of any related Advance under the credit enhancement as provided in this Section:

(1) the interest component; and

(2) any principal component which is to amortize immediately 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. and is not to be deposited into the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. .

c. For Direct PayDirect PayCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) regardless of whether the Borrower has reimbursed Fannie Mae for such payments. Weekly Variable Rate transactions where the BorrowerBorrowerPerson who is the obligor per the Note. is obligated to make its payments 2 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. prior to the 15th of each month and the bondholders must be paid on the 15th of each month, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make its payments by wire transfer of same day funds on the 1st or 15th calendar day of each month. Other requirements may apply, as specified in the Reimbursement Agreement.

216.02B	Replenishment of Withdrawals from the PRF

If the BorrowerBorrowerPerson who is the obligor per the Note. pays the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. any amount to replenish a withdrawal from the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. shall pay such amount to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. not later than 2:00 p.m. Eastern Time, no later than the Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. immediately after receipt of such monies from the BorrowerBorrowerPerson who is the obligor per the Note. .

216.02C	Collection and Remittance of Borrower Reimbursement Obligations for Fannie Mae Advances

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must pay the following amounts to Fannie Mae:

1. The interest component of the Scheduled Payment and principal component of the Scheduled Payment which is to amortize immediately 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. and is not to be deposited into the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. . Such amounts reimburse Fannie Mae for the related Advance under a Credit Enhancement InstrumentCredit Enhancement InstrumentAgreement between Fannie Mae and a Bond Trustee where Fannie Mae provides credit enhancement of a Credit Enhancement Mortgage Loan, Bonds issued to finance a Credit Enhancement Mortgage Loan, or an Interest Rate Hedge Agreement; and if applicable, a Bond liquidity facility. or Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .

2. Any accrued and unpaid Activity Fee.

3. Any other amounts due to Fannie Mae under the Reimbursement Agreement other than the Facility Fee.

Fannie Mae will draft such amounts so as to be received by Fannie Mae no later than the Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. immediately after the receipt of such monies from the BorrowerBorrowerPerson who is the obligor per the Note. .

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must also collect from the BorrowerBorrowerPerson who is the obligor per the Note. and remit to Fannie Mae any other fees, expenses or additional costs due from the BorrowerBorrowerPerson who is the obligor per the Note. to Fannie Mae under the Reimbursement Agreement. Fannie Mae and/or the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. will notify the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. regarding any such amounts to be invoiced by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for payment by the BorrowerBorrowerPerson who is the obligor per the Note. under the Reimbursement Agreement, the Financing Agreement or other Transaction Document.

216.02D	Monthly Remittance of Fees to Fannie Mae

Fannie Mae will draft the Facility Fee, net of the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Servicing FeeServicing FeeFee a Servicer receives for collecting payments, managing operational procedures, and assuming your portion of credit risk for a Mortgage Loan, and which may be expressed as a percentage. each month. Fannie Mae will draft such amounts 4 calendar days after such amount is scheduled to be paid by the BorrowerBorrowerPerson who is the obligor per the Note. under the applicable Transaction Document. If the fourth calendar day is not a Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. , then such draft will be made on the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. .

216.02E	Notice and Collection of Other Fees and Expenses

At the written request of the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. or if the Reimbursement Agreement or the Financing Agreement requires the BorrowerBorrowerPerson who is the obligor per the Note. to make such payments through 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. will invoice the BorrowerBorrowerPerson who is the obligor per the Note. for any fees and expenses payable by the BorrowerBorrowerPerson who is the obligor per the Note. to the (1) IssuerIssuerEntity that: issues Bonds for a Credit Enhancement Mortgage Loan; packages mortgages for sale as a Security for an MBS; or issues a Letter of Credit. , (2) Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , (3) Rating Agency, (4) Remarketing AgentRemarketing AgentPerson selected by the Issuer to reset the interest rate on the Bonds in order to resell any Bonds tendered by investors on the interest rate reset date. , (5) Rebate Analyst, (6) Compliance Monitor or (7) Custodian.

The Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. invoice must require the BorrowerBorrowerPerson who is the obligor per the Note. to pay all such amounts to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. not later than the earlier of ten days following the receipt of the invoice or the Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. such amounts become due. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will remit all such payments received from the BorrowerBorrowerPerson who is the obligor per the Note. to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , the Rating Agency, or Custodian, as applicable, and, if to the Rating Agency or Custodian, with notice to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. of such payment.

216.03	Prepayments – General Introduction

When a BorrowerBorrowerPerson who is the obligor per the Note. prepays 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. in a DUS Bond Credit Enhancement in whole or in part, the bonds also will be prepaid or redeemed in whole or in part on a corresponding basis. This is the starting point for the analysis of the obligations of the BorrowerBorrowerPerson who is the obligor per the Note. to account for any fees payable on account of the prepayment or redemption.

216.03A	Bond Redemption Premiums Payable to Bondholders

All relevant rules regarding bond redemption premiums will be contained in the related Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. . The BorrowerBorrowerPerson who is the obligor per the Note. is obligated to pay any bond redemption premium. Fannie Mae does not provide credit enhancement for the bond redemption premium.

Not all types of bond redemptions are subject to redemption premiums and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must consult the related Bond Indenture documentation to determine whether a redemption premium is due. As a general rule, only bond redemptions initiated voluntarily or optionally by the BorrowerBorrowerPerson who is the obligor per the Note. will potentially have a redemption premium. Mandatory redemptions almost never have a redemption premium. Mandatory redemptions include redemptions paid from condemnation proceeds and insurance proceeds from casualty losses.

1. Variable Rate Bond Redemption

Weekly variable rate bonds may typically be redeemed at any time, or at least on any bond interest payment date, without restriction or redemption premium to the bondholders subject to the terms of the related Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. .

2. Fixed Rate Bond Redemption

Fixed rate bonds are typically restricted from optional or voluntary redemption by the BorrowerBorrowerPerson who is the obligor per the Note. for a specific period following the original bond issuance date, known as a lockout period. A lockout period may approximate 10 years from the initial bond issuance. Following the expiration of the lockout period, any voluntary redemption during the subsequent 3 to 5 year period typically requires the payment of a redemption premium to bondholders.

NOTE: Most transactions require the BorrowerBorrowerPerson who is the obligor per the Note. to pay the bond redemption premium with money that is not subject to being treated as a voidable preference under applicable bankruptcy and insolvency laws. This usually means the redemption premium cannot come from regular resources of the BorrowerBorrowerPerson who is the obligor per the Note. . The Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. must be consulted for requirements applicable to sources of payment of the Bond Redemption Premium and legal counsel should be consulted.

216.03B	Termination Fee or Prepayment Premium Payable to Fannie Mae

Any Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. payable to Fannie Mae on the credit enhancement is separate and distinct from any redemption premium payable to bondholders. This is true for all executions: Direct PayDirect PayCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) regardless of whether the Borrower has reimbursed Fannie Mae for such payments. , StandbyStandbyCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) if the Borrower fails to make required mortgage note payments or if a bankruptcy event has occurred. and MBSMBSMortgage-Backed Security .

In most instances, Fannie Mae requires the BorrowerBorrowerPerson who is the obligor per the Note. to pay a Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. (or “Termination Fee” if required in the applicable documents) if the prepayment occurs within a certain number of years after original delivery of Fannie Mae’s credit enhancement. In earlier Bond Credit Enhancement transactions, the premium will be called a Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. and will be addressed in the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. . In later transactions, the premium will be called a Termination Fee and will be addressed in the Reimbursement Agreement.

216.03C	Termination When No Prepayment Occurs; Weekly Variable Rate Transactions

In DUS Variable Rate Credit Enhancements, there is the possibility that neither 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. nor the bonds are actually being prepaid, but only that the BorrowerBorrowerPerson who is the obligor per the Note. is replacing Fannie Mae as the provider of the credit enhancement and liquidity, terminating Fannie Mae’s involvement in the transaction. For purposes of this section, that too is treated as a prepayment. In the event that 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. is being prepaid or Fannie Mae is being replaced as credit enhancer, the result is that the credit enhancement is being terminated. In recent years, to take this into account, the general term “Termination” has been used to refer to the events and “Termination Fee” to refer to the fee which may be payable on account of those events.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit any Termination Fee due Fannie Mae in accordance with remittance requirements contained below in this Section by 2:00 p.m. Eastern Time on the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. following the day on which the Borrower’sBorrower’sPerson who is the obligor per the Note. termination of Fannie Mae’s credit enhancement and liquidity is effective.

216.04	Prepayments – Processing

216.04A	General

The NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. requires the BorrowerBorrowerPerson who is the obligor per the Note. to give advance notice of a full or partial prepayment to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , and, if a DUS Variable Rate Credit Enhancement, the Remarketing AgentRemarketing AgentPerson selected by the Issuer to reset the interest rate on the Bonds in order to resell any Bonds tendered by investors on the interest rate reset date. . Any partial prepayment must be in an amount corresponding to an authorized denomination of the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. . Typically, Fannie Mae will require its consent to an optional redemption of 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must always keep in mind that the date on which the BorrowerBorrowerPerson who is the obligor per the Note. must transfer money to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to initiate a prepayment may not be the day that the transfer of funds is treated as a prepayment under the governing documents. For example, under some documents the BorrowerBorrowerPerson who is the obligor per the Note. must make the prepayment not later than the last Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. before the day the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , under the Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. , must have received funds for redemption of the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. . The 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. prepayment will not be recognized until the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. are actually redeemed or deemed paid and no longer under the requirements of the Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. .

216.04B	Prompt Notice of Intended Prepayment

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must promptly notify Fannie Mae (Multifamily Asset ManagementMultifamily Asset ManagementTeam that can be contacted at [email protected]. ) and the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. in writing upon receiving notice from the BorrowerBorrowerPerson who is the obligor per the Note. of a planned prepayment. If the prepayment does not occur on such date, the BorrowerBorrowerPerson who is the obligor per the Note. may not subsequently prepay the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. in full without first giving the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. and all other parties to whom notice is required, a new notice of intent to prepay in accordance with the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .

216.04C	Critical Path Due Dates

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must ensure that the final prepayment amount quoted to the BorrowerBorrowerPerson who is the obligor per the Note. prior to prepayment is correct. Accordingly, before the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. advises the BorrowerBorrowerPerson who is the obligor per the Note. of the final prepayment amount, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must verify such amount with the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. and Fannie Mae.

1. No less than 10 days prior to the scheduled prepayment date, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must obtain the Bond Trustee'sBond Trustee'sTrustee for a Credit Enhancement Instrument. written confirmation of all amounts due and payable in connection with the prepayment.

2. No less than 10 days prior to the scheduled prepayment date, and after verifying amounts due on the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. with the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must request verification of the full or partial prepayment amount from Fannie Mae.

3. No less than 5 days prior to the day the BorrowerBorrowerPerson who is the obligor per the Note. is required to initiate the prepayment, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must advise the BorrowerBorrowerPerson who is the obligor per the Note. in writing of the full amount necessary to make the prepayment.

NOTE: The day the BorrowerBorrowerPerson who is the obligor per the Note. is required to initiate the prepayment will be before the day the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. are to be redeemed.

4. For weekly variable rate bonds, immediately following the last day on which interest is determined on the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. before the scheduled redemption date of the bonds, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must re-verify the amount the BorrowerBorrowerPerson who is the obligor per the Note. must pay for the prepayment. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately advise the BorrowerBorrowerPerson who is the obligor per the Note. of any correction required by the re-verification.

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should note that the transaction documents do not uniformly address the redemption premium, if any, payable to Bondholders and Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or termination fee, if any, payable to Fannie Mae on account of a prepayment of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. . In some instances, the fee maintenance Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. set out in the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. will be payable to Fannie Mae. In other instances, the Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. payable under the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. must be remitted to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. for payment to bondholders as a redemption premium. In this case, the BorrowerBorrowerPerson who is the obligor per the Note. may be required to pay a Termination Fee to Fannie Mae pursuant to the Reimbursement Agreement. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must be alert to these requirements.

216.04D	Fannie Mae’s Confirmation Required

To obtain Fannie Mae’s confirmation of the prepayment amount, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a statement detailing the following:

1. the Fannie Mae 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. number(s) and bond number(s), 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). name and address and the expected prepayment date;

2. all amounts that it has determined (and for such amounts due the Bondholders, confirmed with the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. ) will be due and payable by the BorrowerBorrowerPerson who is the obligor per the Note. on the prepayment date, including:

(a) the full or partial principal prepayment (as of the prepayment date) of the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. , separately specifying any amounts in the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. expected to be applied to principal;

(b) accrued interest up to but not including the date of prepayment of the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. ;

(d) any Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee required to be paid to the Bondholders or Fannie Mae, respectively, under the terms of the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. , the Financing Agreement, the IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. or the BondsBondsTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. ;

(e) any termination fee payable to Fannie Mae pursuant to the Reimbursement Agreement;

(f) any other amounts due under the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; and

(g) all other amounts due upon a redemption of 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. under the Bond Documents, including any interest required to cover the gap between 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. and BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. prepayment for which an escrow or collateral is not already provided. (The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must request this information from the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. .)

3. written confirmation from the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. of all amounts due the Bondholders.

4. all amounts that will be due and payable to Fannie Mae on the day as required by this Section following prepayment, including:

(a) Credit Enhancement FeeCredit Enhancement FeeFee due to Fannie Mae for a Credit Enhancement Instrument. and Liquidity Fee;

(b) any previously unpaid fees or other amounts owed to Fannie Mae; and

(c) any applicable Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee that is due, broken down into the portions due to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. and Fannie Mae.

The Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee is a percentage (as specified in the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. or Reimbursement Agreement) multiplied by the UPBUPBUnpaid Principal Balance of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. after crediting the scheduled payment due on the date regular mortgage loan payments are due (in some transactions, the first of the month and in others, the 15th of the month) in which a prepayment takes place.

Fannie Mae’s share of the Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee will be a percentage determined by dividing the sum of the Credit Facility Fee and the Liquidity Fee by the sum of the Credit Facility Fee, Liquidity Fee and the Servicing FeeServicing FeeFee a Servicer receives for collecting payments, managing operational procedures, and assuming your portion of credit risk for a Mortgage Loan, and which may be expressed as a percentage. .

No Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee is due in connection with an application of insurance proceeds or condemnation awards, a monthly deposit to the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. , a redemption of 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. from amounts transferred from the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. to a redemption account, a reduction and amortization of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. as a result of a BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. redemption, or an adjustment to a Reset Rate or a Fixed Rate.

For New Construction/Substantial Rehabilitation Mortgage Loans, other prepayment criteria may apply depending on the transaction structure.

Fannie Mae is not responsible for confirming any amounts owed to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. at the time of the prepayment (e.g., any administrative fees due for services performed by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. under a Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. ); however, the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. payoff statement should clearly denote any such amounts so that Fannie Mae can distinguish them from amounts due exclusively to Fannie Mae and the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. .

Fannie Mae will review the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. figures and contact the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to reconcile any discrepancies. Upon completion of its review and any necessary reconciliation, Fannie Mae will respond to the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. verification request in writing. In its response, Fannie Mae will confirm the total payoff amount due to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. from the BorrowerBorrowerPerson who is the obligor per the Note. , and will also separately confirm the amounts due to Fannie Mae from the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , as well as individual items comprising such total amounts.

It is the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. responsibility to prepare lien release documentation.

216.05	Prepayments: Prepayment Reporting

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report the prepayment amount, including any applicable Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or Termination Fee due Fannie Mae and/or any redemption premium due the bondholders, to Fannie Mae in accordance with the reporting requirements contained in Part V, Chapter 2: Reporting and Remitting, Section 216.01: Monthly Bond Credit Enhancement Reporting. The date the report is due depends on the execution type of the underlying transaction.

1. If 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. payments are due on the first of the month, the report is due on the fourth calendar day of the month in which the prepayment occurs, or the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. if the fourth is not a Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. .

2. If 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. payments are due on the 15th of the month, the report is due on the 15th of the month or the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. if such day is not a Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. .

216.06	Prepayments: Remittances

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit any Prepayment PremiumPrepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. and/or Termination Fee due Fannie Mae by 2:00 p.m. Eastern Time, on the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. following the day on which the Borrower’sBorrower’sPerson who is the obligor per the Note. prepayment is received.

Depending on the execution and transaction type, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must also be concerned with invoicing, collecting and remitting the principal amount of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. to be prepaid. In all cases, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must invoice and collect the principal amount being prepaid from the BorrowerBorrowerPerson who is the obligor per the Note. . No prepayment of Direct PayDirect PayCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) regardless of whether the Borrower has reimbursed Fannie Mae for such payments. Facilities will be allowed until Fannie Mae receives the necessary funds from the BorrowerBorrowerPerson who is the obligor per the Note. .

Any prepayment of principal on 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. received by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. shall be paid, as follows:

1. Standby Execution: Prepayments shall be remitted to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. not later than the BondBondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. immediately after the date of receipt such funds by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. ; or

2. Direct PayDirect PayCredit enhancement under which Fannie Mae makes principal and interest payments directly to the Bond Trustee (for payment to bondholders) regardless of whether the Borrower has reimbursed Fannie Mae for such payments. Execution: Prepayments shall be remitted to Fannie Mae on the same day as the Fannie Mae Advance to the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. funding the corresponding bond redemption associated with the prepayment.

216.07	Reporting on Delinquency Status

The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must electronically submit to Fannie Mae using the Multifamily Delinquency Early Warning System (DEWSDEWSMultifamily Delinquency Early Warning System used for reporting the monthly status of Non-Performing Mortgage Loans. ), or any successor system selected by Fannie Mae to do such reporting, the monthly delinquency status of the Mortgage LoanMortgage LoanMortgage debt obligation evidenced, or when made will be evidenced, by the Loan Documents, or a mortgage debt obligation with a Fannie Mae credit enhancement. on the 17th calendar day of the month. If the 15th falls on a holiday or weekend, the System is available the next Business DayBusiness DayAny day other than a Saturday, Sunday, day when Fannie Mae is closed, day when the Federal Reserve Bank of New York is closed, or for any MBS and required remittance withdrawal, day when the Federal Reserve Bank is closed in the district where any of the MBS funds are held. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must plan around this one day window period for the purpose of reporting delinquencies. This rule applies to all execution and transaction types for DUS Bond Credit Enhancement.