Section 104

Bond Transactions and Credit Enhancement Mortgage Loans

104.01

Borrower Obligations
104.01A

Payments

Operating Procedures

Collect all of the following from the Borrower BorrowerPerson who is the obligor per the Note. :

  • reimbursement of all amounts Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! paid or is due per any:
    • Credit Enhancement Instrument Credit 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 MBS for Bonds MBS for BondsFannie Mae MBS: issued to credit enhance tax-exempt Bonds; or exchanged for Bonds redeemed at MBS issuance. ;
    • Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. or Reimbursement Agreement;
    • Bond BondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Collateral Agreement Collateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. ; and
    • Interest Rate Cap Agreement Interest Rate Cap AgreementContract setting forth the terms and conditions of an Interest Rate Cap, Hedge, or Swap. or other interest rate hedge;
  • any Facility Fee and/or Activity Fee for an unreimbursed Liquidity Advance per the Reimbursement Agreement;
  • all amounts required to replenish the PRF PRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. ;
  • any Prepayment Premium Prepayment PremiumFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. or other Termination Fee;
  • any other fees, expenses, or additional costs due per any
    • Credit Enhancement Instrument Credit 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 MBS for Bonds MBS for BondsFannie Mae MBS: issued to credit enhance tax-exempt Bonds; or exchanged for Bonds redeemed at MBS issuance. ,
    • Security Instrument Security InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. ,
    • Reimbursement Agreement, or
    • other Loan Document Loan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; and
  • any other amounts due Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! or the Bond Trustee Bond TrusteeTrustee for a Credit Enhancement Instrument. .
Steps Activity...
Calculate the Amount Due

After receiving the information to calculate the amount due, you must

 

  • immediately invoice the Borrower BorrowerPerson who is the obligor per the Note. , and
  • remit the funds to the appropriate parties per the Reimbursement Agreement or Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
Advance Funds Notification

Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! will notify you of the amount disbursed on or after each disbursement date for any:

 

  • Credit Enhancement Instrument Credit 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 MBS for Bonds MBS for BondsFannie Mae MBS: issued to credit enhance tax-exempt Bonds; or exchanged for Bonds redeemed at MBS issuance. ;
  • Loan Document Loan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; or
  • other Bond BondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. Collateral Agreement Collateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .
Payment Timing

You must remit all Borrower BorrowerPerson who is the obligor per the Note. payments per the Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. or Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! ’s instructions.


If you do not pay Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! or the Bond Trustee Bond TrusteeTrustee for a Credit Enhancement Instrument. until the next Business Day Business 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. , you must

 

  • invest the funds overnight, and
  • remit all investment earnings to Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! or the Bond Trustee Bond TrusteeTrustee for a Credit Enhancement Instrument. with the payment.

 

For Borrower BorrowerPerson who is the obligor per the Note. payments received after 4:00 p.m. Eastern Time, you must use your best efforts to invest the funds.
104.01B

Principal Reserve Fund

Requirements

You must ensure no PRF PRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. withdrawal occurs without Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! 's approval.

Operating Procedures

For each Credit Enhancement Mortgage Loan Credit 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. , you must:

  • Review the Bond Trustee's Bond Trustee'sTrustee for a Credit Enhancement Instrument. reported PRF PRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. balance.
  • Collect from the Borrower BorrowerPerson who is the obligor per the Note. any amount withdrawn from the PRF PRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. , including withdrawals reimbursing Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! for amounts it paid per the
    • Credit Enhancement Instrument Credit 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 MBS for Bonds MBS for BondsFannie Mae MBS: issued to credit enhance tax-exempt Bonds; or exchanged for Bonds redeemed at MBS issuance. , or
    • Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
104.02

Cash Collateral Agreements

Requirements

You must:

  • ensure any control agreement perfecting Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! ’s security interest in pledged collateral remains in full force and effect; and
  • not invest, apply, or release any collateral under a Cash Collateral or other Security Agreement.
104.03

UCC Filings

Operating Procedures

For UCC UCCUniform Commercial Code filings per Loan Documents Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. or Bond BondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. documents, you must:

  • instruct each Bond Trustee Bond TrusteeTrustee for a Credit Enhancement Instrument. to file UCC UCCUniform Commercial Code continuation statements at least 90 days before the filing expires; and
  • confirm the filing occurred before expiration.
104.04

Remarketing Agent Changes

Requirements

For Bond BondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. transactions that remarket on scheduled mandatory tender and remarketing dates where Fannie Mae Fannie MaeThis Glossary term Is Created Using Automation in Lower Environments and is used for testing purposes only!! provides Bond BondTax-exempt or taxable multifamily revenue bonds, or other tax-exempt or taxable bonds, issued to finance 1 or more Credit Enhancement Mortgage Loan Properties. liquidity support, you must ensure any new Remarketing Agent Remarketing 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. complies with Part III, Chapter 18: Bond Transactions and Credit Enhancement Mortgage Loans, Section 1803.02: Remarketing Agent .