Chapter 2
| Section 201 | |
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This Chapter:
- outlines the reporting and account reconciliation policies and procedures 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. ;
- applies to both Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. and Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. , except where noted that a particular procedure is applicable only to one or the other execution;
- describes the methods for accounting for scheduled monthly payments, payment shortages, additional principal payments, repayments of advances, and payments in full; and
- describes Fannie Mae's remittance requirements, the method for remitting, and the format for reporting 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. information on all transactions.
Fannie Mae purchases 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. for cash or in exchange for the issuance of a SecuritySecurityMBS, PFP MBS, or REMIC. . Fannie Mae reserves the right to later place any of the 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. purchased for cash into a SecuritySecurityMBS, PFP MBS, or REMIC. (e.g., PFP MBSPFP MBSMBS backed by a PFP Mortgage Loan. ). If Fannie Mae securitizes 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may be required to make certain changes to its reporting and remitting procedures. If such an event occurs and changes to a Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. reporting and remitting procedures will be required, Fannie Mae will notify the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in writing.
Fannie Mae reserves the right to modify its Remittance Accounting system and forms to accommodate future changes to its overall systems applicable to 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. .
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for collecting monthly P&IP&IPrincipal and interest payments from the BorrowerBorrowerPerson who is the obligor per the Note. in accordance with 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. executed by the BorrowerBorrowerPerson who is the obligor per the Note. . All P&IP&IPrincipal and interest payments and T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. amounts collected by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in connection with 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. must be deposited in the applicable P&IP&IPrincipal and interest and T&I Custodial AccountsT&I Custodial AccountsCustodial Account for the deposit of T&I and other impound escrow funds. maintained in accordance with the requirements of Part V, Chapter 3: Custodial Accounts.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must track and account separately for all P&IP&IPrincipal and interest payment activity relating to each 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report to Fannie Mae on the P&IP&IPrincipal and interest payment activity relating to each 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 provided in this Chapter.
| Section 203 | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must use Fannie Mae’s eServicing System to report 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 information on all Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. and Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must register to use the eServicing System prior to use. Information regarding registering for the eServicing System can be found on https://multifamily.fanniemae.com/applications-technology/eservicing. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must segregate its Cash Mortgage LoanCash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. servicing portfolio from its Securitized Mortgage LoanSecuritized Mortgage LoanMortgage Loan backing an MBS, PFP MBS, or REMIC. servicing portfolio for reporting purposes.
All reportable transactions will fall into one or more categories. Some transactions update the status of 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. or summarize collection activity, while others update the information in Fannie Mae’s records (e.g., PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). addresses, ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. 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. identification numbers, 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. terms, subservicing status, etc.).
| 203.03 | |
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| 203.03A | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must use the eServicing System to report its monthly 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. activity to Fannie Mae following the end of each Reporting Period, commencing with the month following the:
- date Fannie Mae acquired the Cash Mortgage LoanCash Mortgage LoanMortgage Loan purchased by Fannie Mae in exchange for cash. or PFP Mortgage LoanPFP Mortgage LoanMortgage Loan originally purchased as a Cash Mortgage Loan or held in Fannie Mae’s portfolio, but subsequently securitized as an MBS. ; or
- Issue DateIssue DateFirst day of the month a Security is issued. for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. (other than PFP MBSPFP MBSMBS backed by a PFP Mortgage Loan. ).
The following are the cutoff dates for activity reporting on 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. :
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Monthly Activity Cutoff Date |
Monthly Activity Report Due Date |
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Servicer may establish as its cutoff date any day from the 25th of the month to the last day of the month. |
Not later than the second 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. of the month following the cutoff date for the Reporting Period. |
| 203.04A | |
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For each Security Pool serviced 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 submit a monthly Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. report that references:
- the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. ; and
- the Security Pool number.
For Same Month PoolingSame Month PoolingDelivery option permitting Mortgage Loans to be pooled and secure an MBS issued in the same month as the Mortgage Loan Origination Date. 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. , the BorrowerBorrowerPerson who is the obligor per the Note. will have made no payment as the monthly debt service payment will not yet have come due. Because the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. report for the month following the Issue DateIssue DateFirst day of the month a Security is issued. of the Security Pool under the Same Month PoolingSame Month PoolingDelivery option permitting Mortgage Loans to be pooled and secure an MBS issued in the same month as the Mortgage Loan Origination Date. DeliveryDeliverySubmission of all correct, accurate, and certifiable documents, data, and information with all applicable documents properly completed, executed, and recorded as needed, and any deficiencies resolved to Fannie Mae’s satisfaction. option will not include an amount for principal curtailment for amortizing 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report the Issue Date Principal BalanceIssue Date Principal BalanceFor any Securitized Mortgage Loan, the UPB of the Note after crediting: the principal portion of any scheduled monthly installment due on or before the Security Issue Date, whether or not collected; and any unscheduled principal payment received on or before the Security Issue Date. 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 the first reporting cycle Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. . As long as the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. reports the Issue Date Principal BalanceIssue Date Principal BalanceFor any Securitized Mortgage Loan, the UPB of the Note after crediting: the principal portion of any scheduled monthly installment due on or before the Security Issue Date, whether or not collected; and any unscheduled principal payment received on or before the Security Issue Date. of the Securitized Mortgage LoanSecuritized Mortgage LoanMortgage Loan backing an MBS, PFP MBS, or REMIC. in its first Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. report, there will be no impact on the Pool-to-Security balance reconciliation for that month.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must have transmitted all of its Security BalancesSecurity BalancesFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. (or corrections to balances reported in error) to Fannie Mae by 5:00 p.m. Eastern Time on the second 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. of each month following the Reporting Period. If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. anticipates a problem in meeting this reporting deadline or has a transmission problem that will result in late reporting, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact its Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). .
If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. fails to meet Fannie Mae’s reporting deadline, Fannie Mae may estimate the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Security BalancesSecurity BalancesFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. so Fannie Mae can pass-through payments to InvestorsInvestorsMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. and publish Security BalancesSecurity BalancesFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. in a timely manner. When Fannie Mae does this, Fannie Mae’s estimate will be both the published Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. , and the beginning Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. used for the next month’s Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. report. Fannie Mae will send the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. written notification of any published estimated Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. within 10 days after publication by Fannie Mae.
| 203.05 | |
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The exact due date of the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. submission of its reports depends on the type of transaction being reported.
| 203.05A | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report removal activity (e.g., payoff, repurchase, liquidated-held for sale, and liquidated third-party sale/condemnation) by the second 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. of the month following the cutoff date for the Reporting Period in which the activity occurred. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may correct any removal activity reporting error by resubmitting the corrected information in time to reach Fannie Mae by the second 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. of the month following the Reporting Period. If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is unable to correct the error, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must notify its Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). about the error.
| 203.05B | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make sure that all other transactions (which are the transactions that comprise the bulk of its reports) are transmitted in sufficient time for receipt by Fannie Mae by the second 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. of the month following the cutoff date for the Reporting Period.
The Loan Activity Record is used to provide 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 detail of amounts due to Fannie Mae or the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. for each 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 Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. trial balance.
| 203.06A | |
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Payment collection relates to the receipt and application of the monthly payment. The information that must be reported includes:
- actual last paid installment ("LPILPIDue date of the last payment received. ") date;
- actual UPBUPBUnpaid Principal Balance ; and
- remittance amount (distributed between P&IP&IPrincipal and interest ).
Under the Same Month PoolingSame Month PoolingDelivery option permitting Mortgage Loans to be pooled and secure an MBS issued in the same month as the Mortgage Loan Origination Date. option, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must not report a principal distribution amount for the first reporting cycle following the Issue DateIssue DateFirst day of the month a Security is issued. of the Security Pool because no payment will have come due from the BorrowerBorrowerPerson who is the obligor per the Note. . For the first reporting cycle, the actual 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. will equal the Issue DateIssue DateFirst day of the month a Security is issued. principal balance, as no principal payment will be subtracted from the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. or passed through to the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. .
| 203.06B | |
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Fee collection relates to any special fees that were collected from the BorrowerBorrowerPerson who is the obligor per the Note. during the Reporting Period.
| 203.06C | |
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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. status relates to special actions that have occurred (e.g., a payoff or a repurchase). An action code and an action date (specifying when the reported action occurred or will occur) must be reported. The User Manual for the eServicing System provides detailed information regarding action codes and action dates.
On approximately the 10th day of the month, reports are available in the eServicing System for ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to verify the amount to be drafted on the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. , including P&IP&IPrincipal and interest and Prepayment PremiumsPrepayment PremiumsFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. due to Fannie Mae or the MBS InvestorMBS InvestorFor MBS Mortgage Loans, either a Third Party MBS Investor for Lender-Arranged Sales, or the Multifamily Trading Desk. .
3 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. before the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. , reports are available in the Cash Loan Drafting ApplicationCash Loan Drafting ApplicationMultifamily application or successor system, where you review, update, and certify amounts for Fannie Mae to draft from your bank accounts via ACH for monthly P&I and payoff remittances for: Cash Mortgage Loans; and PFP Mortgage Loans. for ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to review, update, and certify the amount to be drafted on the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. , including Prepayment PremiumsPrepayment PremiumsFor a Mortgage Loan prepayment, amount the Borrower must pay in addition to the prepaid principal and accrued interest per the Loan Documents. due to Fannie Mae. Amounts must be reviewed, updated, and certified by 4:30 p.m. ET 1 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 Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. .
| 203.07C | |
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By the 23rd day of the month, the Summary of Processed Activity and other reports are available in the eServicing System for the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to reconcile with its internal records.
| 203.08A | |
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At the end of each Reporting Period, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must reconcile the actual ending 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. balance for 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 any given Security Pool to the ending Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. for that Security Pool. To perform this reconciliation, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must use the following calculation:
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Function |
Ending Principal Balance for the Mortgage Loan in Security Pool (from current month) |
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PLUS |
Prepaid Principal (as of current month) |
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MINUS |
Delinquent Principal (as of current month) |
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MINUS |
Scheduled Principal (as of current month) |
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PLUS |
Principal Portion of Last Installment for Liquidated Mortgage Loan (as of current month) |
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Adjusted Principal Balance for Security Pool |
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MINUS |
Ending Security Balance for Reporting Period |
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EQUALS |
Difference |
| 203.08B | |
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Because the total 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. that is issued for a Security Pool is rounded down to the next lowest whole dollar amount of the actual “Issue Date Principal BalanceIssue Date Principal BalanceFor any Securitized Mortgage Loan, the UPB of the Note after crediting: the principal portion of any scheduled monthly installment due on or before the Security Issue Date, whether or not collected; and any unscheduled principal payment received on or before the Security Issue Date. 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. ”, the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. will be smaller than the actual 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. . The difference will never be greater than $0.99 for a single Security Pool. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must adjust for this difference in the first monthly accounting report it submits after the Issue DateIssue DateFirst day of the month a Security is issued. of the SecuritySecurityMBS, PFP MBS, or REMIC. , classifying it as an “unscheduled” principal adjustment.
Other differences may arise in the reconciliation between 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. in a Security Pool and the outstanding Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. . These differences cannot exceed more than $0.25 for 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. in the Security Pool. At least once a year, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make an adjustment to correct any differences.
1. If Security Balance is Greater than UPB
If the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. is higher than 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must immediately deposit the funds in the “scheduled/scheduled” P&I Custodial AccountP&I Custodial AccountCustodial Account for principal and interest deposits. for Security Pools so that the funds can be passed through to Fannie Mae (as an “unscheduled” principal collection) with the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. next monthly remittance.
2. If Security Balance is Lower than UPB
If the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. is lower than 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may adjust a subsequent pass-through amount that includes an “unscheduled” principal collection to correct for this difference.
The eServicing System produces a Pool-to-Security Reconciliation on a monthly basis to assist ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. with review. ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. are required to review and certify any pool-to-security difference each month by month end. Differences occur when the MBSMBSMortgage-Backed Security pool security balance does not match the sum of the scheduled 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. . Fannie Mae calculates pool-to-security differences after monthly 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 SecuritySecurityMBS, PFP MBS, or REMIC. reporting is complete. For each pool with a difference, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must review the deficiency, research the difference, and determine the appropriate remedy. The Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. certification includes the identification and selection of a deficiency reason, and a statement of how it should be resolved.
| Section 204 | |
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| 204.01 | |
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Generally the Borrower'sBorrower'sPerson who is the obligor per the Note. monthly payment consists of P&IP&IPrincipal and interest and deposits for insurance, taxes, replacement reserves and replacement hedges or some combination of such items. In some instances, the payment may include additional funds to be applied toward the UPBUPBUnpaid Principal Balance or to repay funds advanced 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 account for each portion of the Borrower'sBorrower'sPerson who is the obligor per the Note. monthly payment in the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. records. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must track both actual and 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. balances (a.k.a., Security Pool and SecuritySecurityMBS, PFP MBS, or REMIC. balances) and reconcile any outstanding difference (e.g., the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. advances for insufficient BorrowerBorrowerPerson who is the obligor per the Note. payments).
| 204.02 | |
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The interest calculation method is generally specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. are required to calculate interest due for each 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 required by the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . If the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. do not contain any information regarding the interest calculation method, then ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should assume a 30/360 accrual method.
Interest will accrue based upon the actual number of days in a calendar month and a 360-day year.
Interest will accrue based upon a 30-day month and a 360-day year.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must enforce each 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 accordance with the terms of the executed Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . This includes making periodic interest rate and payment adjustments in connection with any type of Adjustable Rate Mortgage LoansAdjustable Rate Mortgage LoansMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must change 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. interest rate and monthly payments to the fullest extent permitted or required, maintaining at all times 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. margin specified in the executed Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . Factors used to determine the new interest rate for ARM Loans include:
- the IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. on which the rate is to be based;
- the “look back” period;
- any applicable interest rate change limitations; and
- 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. margin.
If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. fails to make a timely interest rate or payment adjustment, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must use its own funds to satisfy any shortage.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must determine the IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. on which the rate is to be based as specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . To assist the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in monitoring indexes, Fannie Mae offers an ARM LoanARM LoanMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. service through its website on https://multifamily.fanniemae.com. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must establish procedures to monitor the IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. to assure that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. uses the latest available IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. to determine an interest rate change.
Except for Fannie Mae Structured ARM Loans, a Required Monthly Payment change occurs at established intervals and corresponds to any change in the interest rate. The new monthly payment is calculated by determining the amount required to repay 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. in substantially equal payments over the remaining amortization period 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. at the interest rate in effect following the latest interest rate change utilizing the applicable Interest Calculation Method. 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. is an interest-only 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 new monthly payment is the monthly interest payment at the interest rate in effect following the latest interest rate change utilizing the applicable Interest Calculation Method. The new Required Monthly Payment becomes effective on the first day of the month following the month in which the interest Rate Change Date occurs.
Prior to the effective date of the Monthly Payment/Rate Change the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a Monthly Payment/Rate Change via the eServicing System. For assistance with rate and/or payment changes, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact its Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). .
In order for Fannie Mae to account for ARM LoansARM LoansMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. on its books, Fannie Mae must receive the Monthly Payment/Rate Change on a timely basis.
| 205.03 | |
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Structured ARM Loans are subject to the same reporting and remittance requirements as other ARM LoansARM LoansMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. except for the differences described in this section.
The interest rate for Structured ARM Loans will be determined based on the applicable interest period (typically either 1-month or 3-months) for the applicable IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. using a 1-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. look-back period per the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. and the requirements of the applicable Structured ARM Loan Plan NumberPlan NumberNumber identifying the applicable loan characteristics for any Mortgage Loan that accrues interest at a variable rate at any time during the loan term. . The applicable interest rate will be determined by adding 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. margin specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. to the applicable IndexIndexBasis for determining the Gross Note Rate of an ARM Loan, including any required alternative index that may be determined necessary by Fannie Mae because the Index is no longer widely accepted or has been replaced as the index for similar financial instruments. value. No periodic or lifetime interest rate limitations apply to this computation.
Rate changes for Structured ARM Loans with a:
- 1-month interest period (Plan NumbersPlan NumbersNumber identifying the applicable loan characteristics for any Mortgage Loan that accrues interest at a variable rate at any time during the loan term. 03488 and 04932) will occur on the first payment date and the first day of each month thereafter until maturity as specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; and
- 3-month interest period (Plan NumberPlan NumberNumber identifying the applicable loan characteristics for any Mortgage Loan that accrues interest at a variable rate at any time during the loan term. 03487) will occur on the first day of the month which is the second month following the first payment date and the first day of every third month thereafter until maturity as specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
The first payment date will be:
- the 1st day of the month following the Mortgage Loan Origination DateMortgage Loan Origination DateDate you fund a Mortgage Loan to the Borrower. , if the Mortgage Loan Origination DateMortgage Loan Origination DateDate you fund a Mortgage Loan to the Borrower. is the 1st calendar day of the month; or
- the 1st day of the second full calendar month following the Mortgage Loan Origination DateMortgage Loan Origination DateDate you fund a Mortgage Loan to the Borrower. for all other 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. .
For example, 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. closes on June 15th, the First Payment Date is on August 1st, and 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. closes on June 1st, the First Payment Date is on July 1st.
A Required Monthly Payment change occurs at established intervals and corresponds to any change in the interest rate, the number of days in an accrual period, or 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. .
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. amortizes, the Required Monthly Payment is the sum of the monthly interest installment and the monthly principal installment. The monthly interest installment is calculated by multiplying 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. by the interest rate in effect following the latest interest rate change utilizing an actual/360 interest accrual method. Equal monthly principal installments will be made over the term 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 the amount set forth in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
If the Structured ARM Loan is interest-only, the Required Monthly Payment is the monthly interest payment which is calculated by multiplying 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. by the interest rate in effect following the latest interest rate change utilizing an actual/360 interest accrual method as set forth in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . The new Required Monthly Payment becomes effective for Structured ARM Loans with a:
- 1-month interest period (Plan NumbersPlan NumbersNumber identifying the applicable loan characteristics for any Mortgage Loan that accrues interest at a variable rate at any time during the loan term. 03488 and 04932), on the 1st day of the month following the month in which the Rate Change Date occurs; or
- 3-month interest period (Plan NumberPlan NumberNumber identifying the applicable loan characteristics for any Mortgage Loan that accrues interest at a variable rate at any time during the loan term. 03487), on the 1st day of each month following any change in the interest rate or if the number of days in an accrual period is different from the prior month, as set forth in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
| Section 206 | |
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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. originated using Fannie Mae published NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. forms, the Borrower'sBorrower'sPerson who is the obligor per the Note. monthly payments must be applied in the following order:
- any delinquent interest (other than interest attributable to the default interest rate);
- any delinquent principal;
- interest for the current month at the Gross Note RateGross Note RateInterest rate stated in the Loan Documents. ;
- principal for the current month;
- reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. or Fannie Mae for any T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. payments;
- reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. or Fannie Mae for any delinquency resolution costs, attorney fees, AppraisalAppraisalWritten statement independently and impartially prepared by a qualified Appraiser stating an opinion of the Property's market value as of a specific date, and supported by the presentation and analysis of relevant market information. fees, environmental assessment costs, or PCAPCAAssessment of the Property's physical condition and historical operation. costs;
- reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. or Fannie Mae for any payments to protect 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). ;
- late charges;
- default interest;
- T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. deposits; and
- Collateral Agreement Custodial AccountCollateral Agreement Custodial AccountCustodial account established by the Servicer for depositing funds received from the Borrower for Collateral Agreements. deposits.
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. not originated using Fannie Mae published NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. forms, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must apply monthly payments received from the BorrowerBorrowerPerson who is the obligor per the Note. as required by the relevant Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . If the Loans Documents do not provide for the order of application of monthly payments, then the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must follow the requirements for the Fannie Mae Post-1998 Loan Documents as provided in Part V, Chapter 2: Reporting and Remitting, Section 206.01: Fannie Mae Form Loan Documents.
| Section 207 | |
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When payments received from the BorrowerBorrowerPerson who is the obligor per the Note. are less than the total amount then due under 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. (including P&IP&IPrincipal and interest and T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. , but may also include required deposits to the Replacement ReserveReplacement ReserveCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. or other monies due as required in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ), 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 in default and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must follow the default procedures specified in:
- Part VI, Chapter 3: Non-Performing Primary Risk Mortgage Loans; or
- Part VI, Chapter 5: Non-Performing Secondary Risk Mortgage Loans.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may not supplement partial payments received from the BorrowerBorrowerPerson who is the obligor per the Note. with funds from any Collateral Agreement Custodial AccountCollateral Agreement Custodial AccountCustodial account established by the Servicer for depositing funds received from the Borrower for Collateral Agreements. without Fannie Mae's prior written consent.
| Section 208 | |
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| 208.01 | |
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| 208.01A | |
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This Section 208 shall apply to all loans purchased by Fannie Mae (i) under the DUSDUSDelegated Underwriting and Servicing product line and (ii) under any contracts entered into after June 1, 2012, unless any such contract provides that this Section 208 shall not apply to such contract.
Whether or not the BorrowerBorrowerPerson who is the obligor per the Note. pays to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. the full amount due under 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. (other than a 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 LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. will remit to Fannie Mae Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. in an amount equal to all monthly P&IP&IPrincipal and interest installments then owed under each 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. , net of Servicing FeesServicing FeesFee 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. , in the manner and at the time the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is required to make remittances under the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. or the Lender’s ContractLender’s ContractProgram Documents per the Multifamily Selling and Servicing Agreement. . The Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. agreement to make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. in respect of 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. constitutes a separate contractual obligation of the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. to Fannie Mae and is not a guaranty or surety of any obligation of the related BorrowerBorrowerPerson who is the obligor per the Note. . The Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. obligation to fund Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. , except in the case of Secondary Risk Mortgage LoansSecondary Risk Mortgage LoansMortgage Loan where you bear all losses until your recourse obligation is exhausted. , is not intended to require advances of the principal balance due on the scheduled or accelerated maturity date for payment in full of 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. . The Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. obligation to fund Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. with respect to Secondary Risk Mortgage LoansSecondary Risk Mortgage LoansMortgage Loan where you bear all losses until your recourse obligation is exhausted. shall include the obligation to fund the principal balance due on the scheduled or accelerated maturity date for payment in full of 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. .
Whether or not the BorrowerBorrowerPerson who is the obligor per the Note. pays to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. the full amount due on a 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 whether such amounts are payable under the Financing Agreement, 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 Reimbursement Agreement or other transaction documents, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. in amounts as follows, each in the amount as required to be made under the Financing Agreement, 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 Reimbursement Agreement or other applicable transaction document, net of any 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. otherwise payable to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. :
- interest payments as required by the definition of Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. , net of Servicing FeesServicing FeesFee 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. ;
- monthly installments of principal owed on the 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. , or, if the transaction documents of the 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. require the BorrowerBorrowerPerson who is the obligor per the Note. to make deposits to a PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. in lieu of amortizing the principal of the 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. in whole or in part, deposit in a special custodial account meeting the requirements of the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. (“Special Custodial Account”) any amounts that the BorrowerBorrowerPerson who is the obligor per the Note. was obligated 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. , the Reimbursement Agreement or other applicable transaction document to pay as deposits to the PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. and transfer such funds in the Special Custodial Account to the applicable Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. at such time as the funds are required for a mandatory payment of P&IP&IPrincipal and interest under 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 annual or other periodic fee of 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. as a continuing fee for the issuance 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. and the provision of the financing for 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 annual or other periodic continuing trust administration fee of the Bond TrusteeBond TrusteeTrustee for a Credit Enhancement Instrument. ;
- the annual or other periodic continuing fee of the rebate analyst, if any, for its rebate calculation services;
- the annual or other periodic continuing fee of the remarketing agent, if any, for its remarketing services;
- the Credit Enhancement FeeCredit Enhancement FeeFee due to Fannie Mae for a Credit Enhancement Instrument. ;
- if the transaction documents of the 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. require the BorrowerBorrowerPerson who is the obligor per the Note. to make deposits to a PRFPRFAccount you hold accumulating principal amortization payments for variable rate Bond credit enhancements. in lieu of amortizing the principal of the 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. in whole or in part, the PRF Fee; and
- if the 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. contains a liquidity facility for 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 Liquidity Fee.
The LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall make such advances to the party, in the manner and at the time the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is required to make such remittances under the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. . The Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. agreement to make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. in respect of a 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. constitutes a separate contractual obligation of the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. to Fannie Mae and is not a guaranty or surety of any obligation of the related BorrowerBorrowerPerson who is the obligor per the Note. .
Whether or not BorrowerBorrowerPerson who is the obligor per the Note. makes payments to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall make Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… as and when such amounts constituting Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… are required to be paid.
Whether or not the BorrowerBorrowerPerson who is the obligor per the Note. makes payments to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall make Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… on a 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. as and when such amounts constituting Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… are required to be paid. For 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. , Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… shall include, in addition to those items set out in the definition of Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,…, all fees, costs and expenses, whether recurring or non-periodic, not covered by a Delinquency AdvanceDelinquency AdvanceYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. but necessary, as determined by Fannie Mae, to preserve or protect 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. or to exercise any legal or equitable remedies under the Bond IndentureIndentureBond issuer trust indenture or resolution listing Bond terms. , 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. or any of the other transaction documents (other than the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ).
Unless the Lender’s ContractLender’s ContractProgram Documents per the Multifamily Selling and Servicing Agreement. expressly provides otherwise, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. until the earliest of:
- the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. purchase 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. from Fannie Mae;
- the date on which BorrowerBorrowerPerson who is the obligor per the Note. cures 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. default;
- the date on which the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. makes the fourth of four continuous months of Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. ;
- the Asset Valuation DateAsset Valuation DatePer the Loss Sharing Addendum. established in accordance with Section 6.02 of the Loss Sharing Addendum; or
- the date on which the BorrowerBorrowerPerson who is the obligor per the Note. pays off 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. .
Notwithstanding the foregoing, (i) for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. to Fannie Mae as long as 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 held by the trust established in connection with such securitization, and (ii) for Credit Enhancement Mortgage LoansCredit Enhancement Mortgage LoansMortgage Loan financed by a Bond issuance where Fannie Mae provides credit enhancement by a Credit Enhancement Instrument, or an MBS for Bonds. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. to Fannie Mae as long as 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 outstanding. However, in either case, LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. will receive reimbursement for such Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. upon request as required by Part V, Chapter 2: Reporting and Remitting, Section 208.02C: Reimbursement for Delinquency and Servicing Advances following the date on which LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. makes the fourth of four consecutive months of Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. or, if earlier, immediately following the Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. 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. and, thereafter, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. will receive reimbursement for each Delinquency AdvanceDelinquency AdvanceYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. upon request. If the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. believes that Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. with respect to 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. are no longer required to be made pursuant to this Section 208.02, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall notify Fannie Mae, in writing, and upon written confirmation by Fannie Mae that it concurs that no further Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. are required, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall cease making Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. with respect to such 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. .
Unless the Lender’s ContractLender’s ContractProgram Documents per the Multifamily Selling and Servicing Agreement. expressly provides otherwise, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must make Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… until the earliest of:
- the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. purchase 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. from Fannie Mae;
- the date on which the BorrowerBorrowerPerson who is the obligor per the Note. cures 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. default;
- the Asset Valuation DateAsset Valuation DatePer the Loss Sharing Addendum. related to a Foreclosure EventForeclosure EventAny of the following: Foreclosure per the Security Instrument; Fannie Mae's exercise of rights and remedies per the Security Instrument or applicable law (including Insolvency Laws) as holder of the Mortgage Loan and/or the Security Instrument, where Fannie Mae (or its designee or nominee),…, a sale 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). directed by a court of competent jurisdiction, a Discounted Loan Payoff, or Note Sale; or
- the date on which the BorrowerBorrowerPerson who is the obligor per the Note. pays off 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 LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall not be required to make Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… to fund escrows or custodial accounts for taxes, assessments, and insurance premiums or to make payments to the accounts established for 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. ; provided, however, that the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must apply any partial payments (including any Net Cash FlowNet Cash FlowOn an annual basis or any specified period, the total Net Operating Income, minus the full amount underwritten for Replacement Reserve expense, regardless of whether deposits will be made (per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and… from 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). that, under applicable state law, is then available for use by Fannie Mae) in the manner specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. and the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. .
Upon the expiration of the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. obligation to make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. as provided above or, with respect to any Securitized Mortgage LoanSecuritized Mortgage LoanMortgage Loan backing an MBS, PFP MBS, or REMIC. , following the date on which the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. makes the fourth of four consecutive months of Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. may, by written notice to Fannie Mae submitted on Fannie Mae Form 4828, together with any supporting documentation required by Fannie Mae, request reimbursement for any and all Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. made by the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. with respect to 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. .
Upon making a Servicing AdvanceServicing AdvanceAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… with respect to 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. , LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. may, by written notice to Fannie Mae submitted on Fannie Mae Form 4829, together with any supporting documentation required by Fannie Mae, request reimbursement for such Servicing AdvanceServicing AdvanceAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,….
Fannie Mae shall reimburse the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. for such Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. and Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… within 60 days following Fannie Mae’s receipt and approval of the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. written request.
This Section 208.02.C shall not apply to Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. or Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… made by the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. with respect to any Non-Performing Mortgage LoanNon-Performing Mortgage LoanMortgage Loan with an uncured default. with a Last Paid InstallmentLast Paid InstallmentDue date of the last payment received. prior to March 1, 2012.
Unless otherwise directed in writing by Fannie Mae, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must seek restitution of any Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… from the BorrowerBorrowerPerson who is the obligor per the Note. . For this repayment, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. may require the BorrowerBorrowerPerson who is the obligor per the Note. to make full restitution on the next occurring 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. payment due date or may permit the BorrowerBorrowerPerson who is the obligor per the Note. to make restitution payments over several months. Amounts due from the BorrowerBorrowerPerson who is the obligor per the Note. for which a Servicing AdvanceServicing AdvanceAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… was made may include default interest on the Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… as permitted in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . Interest must be calculated from and including the date the Servicing AdvanceServicing AdvanceAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… is made to but excluding the date the repayment is received. If the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. permits restitution over several months, such restitution payments will not be included in any required calculation of 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. .
If the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. has been reimbursed by Fannie Mae for any Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… and receives restitution of such Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… from the BorrowerBorrowerPerson who is the obligor per the Note. , the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. shall promptly remit such amounts to Fannie Mae.
For the purpose of calculating monthly distributions to the SecuritySecurityMBS, PFP MBS, or REMIC. certificate holders or other investors, Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… will not be added to the scheduled principal balance of the related 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. , even though the terms 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. may permit increases to the outstanding 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. for such advances and may permit Fannie Mae or the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. , as applicable, to pursue recovery of those advances from the BorrowerBorrowerPerson who is the obligor per the Note. . Servicing AdvancesServicing AdvancesAll amounts required to be paid by the Borrower, for all taxes and assessments against each Property, all insurance premiums for insurance for each Property to insurance carrier(s) acceptable to Fannie Mae, in accordance with the Guide, and any other payment, as determined by Fannie Mae,… do not reduce or modify the Borrower’sBorrower’sPerson who is the obligor per the Note. obligation under the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
Between Fannie Mae and the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. , unless the Lender’s ContractLender’s ContractProgram Documents per the Multifamily Selling and Servicing Agreement. expressly provides otherwise, so long as the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is obligated to make or has made Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. as provided in Part V, Chapter 2: Reporting and Remitting, Section 208.02A: Obligation to Make Delinquency Advances, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is entitled to retain 50 percent of the default interest collected from or on behalf of the BorrowerBorrowerPerson who is the obligor per the Note. . The other 50 percent of such default interest, to the extent collected from or on behalf of the BorrowerBorrowerPerson who is the obligor per the Note. , is remitted to and retained by Fannie Mae. Notwithstanding anything in this Section 208.05 to the contrary, with respect to any Non-Performing Mortgage LoanNon-Performing Mortgage LoanMortgage Loan with an uncured default. with a Last Paid InstallmentLast Paid InstallmentDue date of the last payment received. prior to March 1, 2012, if the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is obligated to make Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. then the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is entitled to all default interest collected from or on behalf of the BorrowerBorrowerPerson who is the obligor per the Note. with respect to such 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. . If the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is not obligated to make any Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. on a Non-Performing Mortgage LoanNon-Performing Mortgage LoanMortgage Loan with an uncured default. , all default interest shall be remitted to and retained by Fannie Mae. Without regard to whether the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. is making Delinquency AdvancesDelinquency AdvancesYour required advances for scheduled monthly Mortgage Loan principal and/or interest per your Lender Contract, or the Guide. , Fannie Mae is always entitled to the interest that accrues at the stated interest rate on 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. net of the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. 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. .
| Section 209 | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit to Fannie Mae collections and other amounts due by the specified Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. established for each product type.
| 209.01 | |
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For purposes of this Section, the following terms shall have the definitions set forth below.
| 209.01A | |
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For each 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 interest portion, adjusted to the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. of the monthly installment (without regard as to whether such amount was collected), due on the first day of the month in which a Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. occurs or which becomes due at any time during the preceding month except the first day thereof.
| 209.01B | |
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For each 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 total of (1) the principal portion of the monthly installment due during the period beginning on the second day of the month preceding the month in which a Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. occurs and ending on the first day of the month in which a Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. occurs, without regard as to whether such amount was collected, and (2) any unscheduled principal recovery collected on 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. during the month preceding the month in which a Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. occurs.
| 209.01C | |
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The total of the Interest Distribution Amount and Principal Distribution Amount to be remitted to Fannie Mae on each Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. .
Monthly P&IP&IPrincipal and interest remittances begin on the initial Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. .
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Initial Remittance Date |
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Cash Mortgage Loans (including Mortgage Loans backing a PFP MBS) |
The month after Fannie Mae purchased 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. . |
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Securitized Mortgage Loans |
The month after the month the MBSMBSMortgage-Backed Security was issued. |
The final Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. occurs:
- 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. paying off on the scheduled Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. : in the month 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. matured and the security balance dropped to $0.00 (e.g., 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. pays off on its scheduled May 1 Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. , the final Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. will be May 18); or
- 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. being prepaid: in the month after the month 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. was prepaid (e.g., 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. prepays anytime between May 2 and May 31, the final Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. will be June 18).
| 209.03 | |
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| 209.03A | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make the monthly remittance funds available for drafting by ACHACHElectronic Automated Clearing House network for processing U.S. banking transactions. via the Cash Remittance SystemCash Remittance SystemMultifamily system where you set up and maintain banking instructions for Fannie Mae’s drafting of remittances per Part V, Chapter 2: Reporting and Remitting, Section 209: Remittance Procedures. on 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. before the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. .
| 209.03B | |
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To set up a Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. before the initial Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. :
- Open a Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. with an Eligible Depository per Part V, Chapter 3: Custodial Accounts, Section 301: Generally;
- Use the Cash Remittance SystemCash Remittance SystemMultifamily system where you set up and maintain banking instructions for Fannie Mae’s drafting of remittances per Part V, Chapter 2: Reporting and Remitting, Section 209: Remittance Procedures. to designate the custodial bank and Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. to be electronically debited or credited.
| 209.03C | |
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The Cash Remittance SystemCash Remittance SystemMultifamily system where you set up and maintain banking instructions for Fannie Mae’s drafting of remittances per Part V, Chapter 2: Reporting and Remitting, Section 209: Remittance Procedures. uses remittance codes linked to the:
- Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. unique 9-digit ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. number; and
- specific Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. identified for the applicable product and execution.
Only 1 Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. per remittance code is permitted, either the:
- P&I Custodial AccountP&I Custodial AccountCustodial Account for principal and interest deposits. for 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. category per Part V, Chapter 3: Custodial Accounts, Section 303.01: Accounts and Deposits; or
- consolidated Drafting AccountDrafting AccountCustodial Account established by the Lender for the benefit of Fannie Mae and for which Fannie Mae has authority to transfer funds. .
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must ensure the:
- individual account drafting instructions, including assigned remittance codes, are coordinated with the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. internal fund processing; and
- transmissions to Fannie Mae include all necessary detail to ensure timely and accurate processing.
The SecuritySecurityMBS, PFP MBS, or REMIC. monthly remittance is the total of the Security Interest Distribution and Security Principal Distribution Amounts. For each month, the SecuritySecurityMBS, PFP MBS, or REMIC. monthly remittance must include the scheduled principal payment due on the first day of that month plus a full month's interest (calculated at the SecuritySecurityMBS, PFP MBS, or REMIC. Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) due in arrears for the previous month. It also may include unscheduled prepayments of principal.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is required to pass through to Fannie Mae in each SecuritySecurityMBS, PFP MBS, or REMIC. monthly remittance, the full scheduled amounts of P&IP&IPrincipal and interest , regardless of whether such amounts actually have been collected from the BorrowerBorrowerPerson who is the obligor per the Note. . A full month's interest (calculated at the SecuritySecurityMBS, PFP MBS, or REMIC. Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) must be included in each SecuritySecurityMBS, PFP MBS, or REMIC. monthly remittance, regardless of whether there has been any partial or full prepayment during the month.
The Security Interest Distribution Amount due is based on the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. remaining after application of the 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. payment due on the first of the previous month. For example, the Security Interest Distribution Amount due on November 18 would be based on the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. remaining after application of the 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. payment due on October 1 (not November 1).
To compensate Fannie Mae for the liability it assumes in issuing the SecuritySecurityMBS, PFP MBS, or REMIC. , Fannie Mae receives a Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. . The Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. is an obligation of the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. and must be paid in arrears on the 7th calendar day, or the preceding 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 7th 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. , of each month, even if there is no collection on 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. or 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. reaches its Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. during the month. Payment of the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. begins with the month following the month in which the SecuritySecurityMBS, PFP MBS, or REMIC. is issued. Fannie Mae will draft the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. from the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. applicable designated P&I Custodial AccountsP&I Custodial AccountsCustodial Account for principal and interest deposits. for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. .
The Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. amount due Fannie Mae in any month is equal to either (a) for 30/360 interest accrual 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. , one-twelfth of the annual Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. rate times the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. remaining after application of the 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. principal payment due on the first day of the previous month, or (b) for actual/360 interest accrual 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. , the annual Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. rate divided by 360 times the number of days occurring in the month immediately preceding the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. payment date times the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. remaining after application of the 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. principal payment due on the first day of the previous month. For example, for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. amount due to Fannie Mae on November 7 is calculated on the Security BalanceSecurity BalanceFor an MBS Pool, the Issue Date Principal Balance minus any MBS principal distribution amounts included in previous MBS monthly remittances. remaining after application of the 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. principal payment due on October 1.
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The monthly Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. must be remitted as long as the SecuritySecurityMBS, PFP MBS, or REMIC. is outstanding, even if there is no collection activity on 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must make funds available for the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. draft on the 7th calendar day of the month, or the preceding 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 7th 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. .
Under this process, Fannie Mae will send an electronic notice (or “bill”) on the 2nd or 3rd calendar day of each month. The draft notice will show the amount due for the Guaranty FeesGuaranty FeesFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. . When the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives the transmission, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must review the draft notice for accuracy. If discrepancies are identified, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must contact Fannie Mae by the 5th calendar day of the month to provide details on the amount and nature of the discrepancy. Fannie Mae will then review its records to validate the discrepancy and make any necessary adjustments to the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. bill. On the 7th calendar day of the month, Fannie Mae will draft the Guaranty FeesGuaranty FeesFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. from the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. designated P&I Custodial AccountP&I Custodial AccountCustodial Account for principal and interest deposits. for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. . If the 7th 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. , the draft will take place on the preceding 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 Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. first remittance to Fannie Mae for 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. submitted under the Same Month PoolingSame Month PoolingDelivery option permitting Mortgage Loans to be pooled and secure an MBS issued in the same month as the Mortgage Loan Origination Date. delivery option is an "interest-only" remittance because the BorrowerBorrowerPerson who is the obligor per the Note. will not have made the first payment. Accordingly, because the BorrowerBorrowerPerson who is the obligor per the Note. will not be required to send a monthly payment to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. under Same Month PoolingSame Month PoolingDelivery option permitting Mortgage Loans to be pooled and secure an MBS issued in the same month as the Mortgage Loan Origination Date. until the month following the date the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. first remittance is due to Fannie Mae, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will have to use some of its own funds to remit the interest that is "scheduled" to be passed through to Fannie Mae for 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 that month and to make the first required Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. remittance. The interest remittance will represent one month's full interest, and will be equal to the Issue DateIssue DateFirst day of the month a Security is issued. 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. times either (a) for 30/360 interest accrual 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. , one-twelfth of the annual Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. of the SecuritySecurityMBS, PFP MBS, or REMIC. , or (b) for actual/360 interest accrual 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. , the annual Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. of the SecuritySecurityMBS, PFP MBS, or REMIC. divided by 360 times the number of days occurring in the month of issuance of the SecuritySecurityMBS, PFP MBS, or REMIC. . The Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. payment will represent one month's full Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. , and be calculated as provided in Part V, Chapter 2: Reporting and Remitting, Section 209.05A: Guaranty Fee Due on 7th Calendar Day of Month based on Issue DateIssue DateFirst day of the month a Security is issued. 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. .
Fannie Mae will not reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for its interest or Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. remittance. However, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:
- receive a partial month's interest based on the Note Rate from the BorrowerBorrowerPerson who is the obligor per the Note. at closing (from the date of closing through the end of the month), and
- receive interest based on the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. from the purchaser of the SecuritySecurityMBS, PFP MBS, or REMIC. (from the first day of the month in which the SecuritySecurityMBS, PFP MBS, or REMIC. is issued to the Book-Entry Delivery Date) as part of the sales proceeds for the SecuritySecurityMBS, PFP MBS, or REMIC. .
If, for any reason, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. cannot make funds available for drafting on 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. prior to the designated Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. , it must immediately notify Fannie Mae by calling the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must describe to Fannie Mae all circumstances and conditions that prevent the monthly remittance from being made on time.
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When the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives a Borrower’sBorrower’sPerson who is the obligor per the Note. notification of intent to 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. , it must examine the specific NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. (including any applicable addendum, exhibit, modification, or amendment) and Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. (and any applicable rider, exhibit, modification or amendment) to determine whether 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. is permitted and, if so, under what conditions. The prepayment provisions of the actual Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. govern in each case.
The Borrower’sBorrower’sPerson who is the obligor per the Note. proposed prepayment date and the timing of its advance notification of its intent to prepay must be consistent with the provisions of the 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 obtain from the BorrowerBorrowerPerson who is the obligor per the Note. the date on which the BorrowerBorrowerPerson who is the obligor per the Note. will 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. . The BorrowerBorrowerPerson who is the obligor per the Note. must give the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. advance notice of its intent to make a full prepayment as required by the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
If a Fannie Mae form Multifamily Note evidences 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. , a prepayment may be made only on 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 a 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. payment date. Non-Fannie Mae form NotesNotesInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. may not contain the same requirement. Some NotesNotesInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. may contain lockout provisions that prohibit full prepayment for a specified period of time. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must not permit a payoff that does not comply with the requirements contained in the Loan DocumentLoan DocumentAll 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 notify Fannie Mae, in writing or through the Fannie Mae Payoff Calculator, upon receiving notice from the BorrowerBorrowerPerson who is the obligor per the Note. of a planned prepayment. Notice of the planned prepayment must be received by Fannie Mae not 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. prior to the contemplated payoff date. The Fannie Mae Payoff Calculator may only be used when the Fannie Mae form Multifamily Note evidences 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must ensure that the payoff figure quoted to the BorrowerBorrowerPerson who is the obligor per the Note. 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 full prepayment payoff amount, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must confirm such amount with Fannie Mae. The Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. request for confirmation of the full prepayment payoff amount must be submitted to Fannie Mae at least 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. before the scheduled prepayment date. At least 5 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 scheduled prepayment date, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must provide the BorrowerBorrowerPerson who is the obligor per the Note. written confirmation of the amount required to pay off 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.
1. Calculating the Full Prepayment Payoff Amount
To obtain Fannie Mae’s confirmation of the full prepayment payoff amount, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must either submit a written statement detailing all amounts that it believes will be due and payable by the BorrowerBorrowerPerson who is the obligor per the Note. on the prepayment date or submit the information through the Payoff Calculator, including:
- 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. (as of the prepayment date);
- all accrued and to-be accrued interest, broken down into the net interest portion due to Fannie Mae (calculated at the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) and the portion to be retained by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. as a 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. , calculated as if the payoff is occurring on the last day of the month in which the prepayment is occurring;
- any unpaid late fees, if applicable;
- 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. that is due in connection with the full prepayment, broken down into the portions due to Fannie Mae and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , respectively; and
- any other amounts due 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. , Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or any other Mortgage Loan DocumentMortgage Loan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , including, if applicable, any unpaid fee due under any Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .
2. Fannie Mae Will Not Confirm Nor Is Responsible for Amounts Owing to Servicer
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 must clearly denote any such amounts so that Fannie Mae can distinguish them from amounts due exclusively to Fannie Mae. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is solely responsible for ensuring that any payoff quote given to the BorrowerBorrowerPerson who is the obligor per the Note. includes any amounts that are owed exclusively to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , as Fannie Mae will not reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for such amounts from any of the funds that the BorrowerBorrowerPerson who is the obligor per the Note. remits to cover the amounts confirmed as being due to Fannie Mae.
3. Fannie Mae Confirmation of Full Prepayment Payoff Amount for Primary Risk Mortgage Loans
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 in writing to the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. verification request. In its response, Fannie Mae will confirm the total payoff amount due to Fannie Mae, as well as the individual items comprising such total amount, including:
- 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. ;
- the net accrued interest due Fannie Mae;
- 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. (broken down into the portions due to Fannie Mae and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. ); and
- any previously unpaid fees or other amounts owed to Fannie Mae.
Fannie Mae will provide any pertinent instructions for completing the prepayment payoff process, including any specific instructions that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must include in its payoff quote to the BorrowerBorrowerPerson who is the obligor per the Note. .
4. No Quote to Borrower until Fannie Mae Confirmation for Primary Risk Mortgage Loans
To ensure that the BorrowerBorrowerPerson who is the obligor per the Note. is quoted the correct payoff amount, including any applicable accrued interest, 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. , late fees, or other amounts that might be owed 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 Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or the other Mortgage Loan DocumentsMortgage Loan 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 not quote a final payoff amount to the BorrowerBorrowerPerson who is the obligor per the Note. without first obtaining Fannie Mae’s confirmation of the accuracy of the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. figures.
5. Fannie Mae Confirmation of Full Prepayment Payoff Amount for Secondary Risk Mortgage Loans
Unless the Lender’s ContractLender’s ContractProgram Documents per the Multifamily Selling and Servicing Agreement. provides otherwise, Fannie Mae will not review the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. payoff calculation for Secondary Risk Mortgage LoansSecondary Risk Mortgage LoansMortgage Loan where you bear all losses until your recourse obligation is exhausted. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is solely responsible for ensuring that any payoff quote given to the BorrowerBorrowerPerson who is the obligor per the Note. includes all amounts that are owed to Fannie Mae and to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .
6. Servicer Liability
Whether confirmed by Fannie Mae through the Payoff Calculator or the payoff calculation is performed 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. is required to collect all amounts owing by the BorrowerBorrowerPerson who is the obligor per the Note. on 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. payoff. If Fannie Mae determines that ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has provided the BorrowerBorrowerPerson who is the obligor per the Note. incorrect information because of an error in the calculation of the payoff quote, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will be responsible for any shortfall and must remit all amounts due to Fannie Mae whether or not it has collected such amounts from the BorrowerBorrowerPerson who is the obligor per the Note. .
1. Full Prepayment Payoff Amount Received on First Business Day of Month
Notwithstanding anything to the contrary above, any full prepayment of 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 or on behalf of a BorrowerBorrowerPerson who is the obligor per the Note. that is received by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. on the first 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. of a month will be deemed received in the prior calendar month for purposes of reporting and remitting such full prepayment.
2. Full Prepayment Reported through the eServicing System Due By 2nd Day of Month
The full prepayment must then be reported electronically to Fannie Mae through the eServicing System. The report of the full payment must be transmitted in time to reach Fannie Mae by the 2nd calendar day of the month following the month of prepayment.
1. Using Pass-Through Rate to Calculate Remittance to Fannie Mae
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must use the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. to calculate its P&I remittance to Fannie Mae. After collecting payoff proceeds, calculated in the manner described above at the Gross Note RateGross Note RateInterest rate stated in the Loan Documents. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must subtract its 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. , calculated using a per diem rate based on the interest accrual method provided for in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. .
2. Remittance Due on Remittance Date
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit the prepayment amount on the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. in the month after the prepayment occurs per the remittance requirements in this Chapter.
1. Calculating the Full Prepayment Payoff Amount
To obtain Fannie Mae’s confirmation of the final payoff amount for a Securitized Mortgage LoanSecuritized Mortgage LoanMortgage Loan backing an MBS, PFP MBS, or REMIC. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a statement, detailing:
- All amounts that it has determined will be due and payable by the BorrowerBorrowerPerson who is the obligor per the Note.
on the prepayment date, including:
- the UPBUPBUnpaid Principal Balance of the loan (as of the prepayment date);
- all accrued and to-be accrued interest, broken down into the net interest portion due to Fannie Mae (calculated at the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) and the portion to be retained by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. as a 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. , calculated as if the payoff is occurring on the last day of the month in which the prepayment is occurring;
- any unpaid late fees, if applicable;
- 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. , if any, that is due in connection with the full prepayment specifying the respective portions due Fannie Mae, the SecuritySecurityMBS, PFP MBS, or REMIC. certificate holder and ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. ; and
- any other amounts due 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. , Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or any other Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , including, if applicable, any unpaid fee due under any Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .
- All amounts that will be due and payable to Fannie Mae by the ServicerServicerPrimary Person servicing the Mortgage Loan, including
the originator,
seller, or
a third party.
on the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan.
in the month following the month of prepayment, including:
- the UPBUPBUnpaid Principal Balance of the loan;
- a full month's accrued interest, calculated at the MBSMBSMortgage-Backed Security Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ;
- 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. broken down into the portions due to the MBSMBSMortgage-Backed Security investor, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , and Fannie Mae calculated in accordance with the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. ; and
- any previously unpaid fees or other amounts owed to Fannie Mae.
2. Fannie Mae Will Not Confirm Nor Is Responsible for Amounts Owing to Servicer
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 must clearly denote any such amounts so that Fannie Mae can distinguish them from amounts due exclusively to Fannie Mae, and the MBSMBSMortgage-Backed Security investor, if applicable.
3. Fannie Mae Confirmation of Full Prepayment Payoff Amount for Primary Risk Mortgage Loans
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 for Primary Risk Mortgage LoansPrimary Risk Mortgage LoansMortgage Loan where Fannie Mae bears all losses or you and Fannie Mae share losses. . Upon completion of its review and any necessary reconciliation, Fannie Mae will respond (in writing) to the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. verification request. 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, including:
- 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. ; and
- accrued interest due:
- 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. (broken down into the portions due to Fannie Mae, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , and the MBSMBSMortgage-Backed Security investor); and
- any previously unpaid fees or other amounts owed to Fannie Mae.
4. No Quote to Borrower Until Fannie Mae Confirmation for Primary Risk Mortgage Loans
To ensure that the BorrowerBorrowerPerson who is the obligor per the Note. is quoted the correct payoff amount, including any applicable accrued interest, 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. , late fees, or other amounts that might be owed 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 Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or the other Mortgage Loan DocumentsMortgage Loan 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 not quote a final payoff amount to the BorrowerBorrowerPerson who is the obligor per the Note. without first obtaining Fannie Mae’s confirmation of the accuracy of the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. figures.
5. Fannie Mae Confirmation of Full Prepayment Payoff Amount for Secondary Risk Mortgage Loans
Fannie Mae will not review the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. payoff calculation for Secondary Risk Mortgage LoansSecondary Risk Mortgage LoansMortgage Loan where you bear all losses until your recourse obligation is exhausted. . The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is solely responsible for ensuring that any payoff quote given to the BorrowerBorrowerPerson who is the obligor per the Note. includes all amounts that are owed to Fannie Mae and to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .
6. Servicer Liability
Whether confirmed by Fannie Mae through the Payoff Calculator or the payoff calculation is performed 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. is required to collect all amounts owing by the BorrowerBorrowerPerson who is the obligor per the Note. on 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. payoff. If Fannie Mae determines that ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has provided the BorrowerBorrowerPerson who is the obligor per the Note. incorrect information because it quotes a final payoff amount to the BorrowerBorrowerPerson who is the obligor per the Note. prior to Fannie Mae confirmation or has erred in its calculation of the payoff quote where Fannie Mae confirmation is not provided, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will be responsible for any shortfall and must remit all amounts due to Fannie Mae whether it has collected such amounts from the BorrowerBorrowerPerson who is the obligor per the Note. .
1. Security Reporting
By the second 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. of the month following the month of prepayment, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report the amount 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. collected to Fannie Mae via the eServicing System in accordance with the reporting requirements provided in this Chapter.
2. Mortgage Loan Reporting Requirements
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. , to Fannie Mae by the second 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. of the month following the month in which the prepayment occurs in accordance with the reporting requirements provided in this Chapter.
Under MBSMBSMortgage-Backed Security , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit a full month's accrued interest (calculated at the MBSMBSMortgage-Backed Security Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) for each month that the MBSMBSMortgage-Backed Security is outstanding, even if a full or partial prepayment occurs during that month. Any shortfall between the interest collected from the BorrowerBorrowerPerson who is the obligor per the Note. and the full month's interest that is due to Fannie Mae must be deposited in the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. MBSMBSMortgage-Backed Security P&I Custodial AccountP&I Custodial AccountCustodial Account for principal and interest deposits. from the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. own funds and remitted to Fannie Mae. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must also remit a full month's Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. for each month that the MBSMBSMortgage-Backed Security is outstanding, even if a full or partial prepayment occurs during that month.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit the prepayment amount on the Remittance DateRemittance DateThe 18th day of each month (or the preceding Business Day if the 18th is not a Business Day) on which you must submit your remittance to Fannie Mae for the Mortgage Loan. in the month after the payoff occurs per the remittance requirements in this Chapter.
Partial prepayment of the outstanding balance of 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. is prohibited unless explicitly permitted in the Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . Under certain circumstances, to the extent permitted in the Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , the proceeds of a Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. held pursuant to an Achievement AgreementAchievement AgreementAgreement requiring the Borrower to provide a letter of credit, cash, or guaranty as additional collateral to support the Mortgage Loan amount and specifying the terms for releasing the collateral. or deposits held under a Replacement Reserve ScheduleReplacement Reserve ScheduleThe Required Replacement Schedule to the Multifamily Loan Agreement (Form 6001 series) and the applicable parts of the Multifamily Loan Agreement (or other agreement approved by Fannie Mae), that evidence the: Borrower’s agreement to replace identified capital items and perform required… or other Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. may be applied as a partial 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. .
Any request from the BorrowerBorrowerPerson who is the obligor per the Note. for permission to make a partial prepayment must be forwarded to the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). , along with the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. analysis and recommendation. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must carefully examine the Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. to determine if partial prepayments are permitted and, if so, under what conditions and whether 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. is required. The Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. analysis of the request must include information about:
- the event or condition precipitating the prepayment request;
- the amount of principal that would be prepaid;
- the estimated 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. , if any, that would be due in connection with the partial prepayment;
- any proposed recasting 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. or other modification of the repayment terms; and
- the proposed timing of the prepayment.
Unless the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. expressly permit partial prepayments, Fannie Mae's approval is required before any partial prepayment is made. If the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). agrees to allow or requires a partial prepayment to be made, it will advise the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in writing of any specific conditions that will apply to such partial prepayment. Such specific conditions may include:
- when and how the prepayment must occur;
- whether 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. must be paid; and
- whether 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. repayment terms will be altered and, if so, how the Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. would have to be modified to reflect such alterations, etc.
Any decision to modify 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. repayment terms in connection with the partial prepayment will be made by Fannie Mae, in its sole and absolute discretion.
When 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. is required in connection with any partial prepayment, 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. is assessed on the amount of principal being prepaid and not on the outstanding 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. calculated and verified in the same manner as is required for full prepayments.
Partial prepayments must be reported in the same manner as is required for full prepayments. When Fannie Mae’s approval is received, the proceeds representing the partial prepayment, including 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. (when required pursuant to the terms of the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ), must be remitted to Fannie Mae in the same manner and timeframe as required for full prepayments.
Fannie Mae approval is not required when the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. permit partial prepayments. Any such partial prepayments must be reported and remitted to Fannie Mae in the same manner and timeframe as is required for monthly remittances.
Partial 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. is generally permitted for the application of the proceeds of an insurance claim or a condemnation award. ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must follow the requirements contained in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. in connection with any such partial prepayment.
The BorrowerBorrowerPerson who is the obligor per the Note. is not required 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. in connection with any prepayment that occurs as a result of the application to 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. of insurance proceeds or condemnation award proceeds, regardless of when 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 such prepayment occurs.
The proceeds representing the partial prepayment must be reported and remitted to Fannie Mae in the same manner and timeframe as is required for monthly remittances.
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The Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. governs over the requirements of the GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. if it specifies whether the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. or ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is entitled to retain a portion of 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. paid by the BorrowerBorrowerPerson who is the obligor per the Note. . If the Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. provides that the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. or ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is entitled to retain a portion 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. , then the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must calculate the applicable 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. owed to the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. or ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , and remit to Fannie Mae that portion 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. owed to Fannie Mae or the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. . If the Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. provides that the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. or ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is not entitled to retain a portion 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. , then the entire 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. must be remitted to Fannie Mae.
If the Lender ContractLender ContractProgram Documents per the Multifamily Selling and Servicing Agreement. does not specify whether the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. or ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is entitled to retain a portion of 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. , then the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is entitled to retain a portion of 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. only as provided below.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must always remit the portion 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. due to the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. and to Fannie Mae with the final 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. payment, retaining the balance 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. due the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. as provided above. Upon receipt, Fannie Mae will pass through the portion 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. due to the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. .
For any prepayment that occurs before the Yield Maintenance Period End DateYield Maintenance Period End DateLast day on which a Borrower owes yield maintenance for a voluntary Mortgage Loan prepayment. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must first determine the total 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. owing by the BorrowerBorrowerPerson who is the obligor per the Note. in accordance with the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . The Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. generally require 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. equal to the greater of (i) 1% of the UPBUPBUnpaid Principal Balance (the “Minimum 1% Prepayment PremiumMinimum 1% Prepayment PremiumFor a prepayment, an amount equal to 1% of the UPB. ”), or (ii) yield maintenance.
Fannie Mae does not guarantee payment of any portion 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. to the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. . The InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. only receives a share of 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. actually received from the BorrowerBorrowerPerson who is the obligor per the Note. . For a Securitized Mortgage LoanSecuritized Mortgage LoanMortgage Loan backing an MBS, PFP MBS, or REMIC. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must calculate the Investor'sInvestor'sMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. share of the total 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. as follows using the yield rate specified per the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. :
(Principal prepaid) x (Pass-Through Rate – yield rate) x (present value factor).
If the result is negative, the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. receives 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. share.
For both Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. and Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must calculate Fannie Mae’s share of the total 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. .
If 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. is greater than the Minimum 1% Prepayment PremiumMinimum 1% Prepayment PremiumFor a prepayment, an amount equal to 1% of the UPB. , the difference between the total 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 the Investor’sInvestor’sMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. portion will be shared between Fannie Mae and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .
Fannie Mae’s share equals:
- for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. :
(total Prepayment Premium - Investor’s portion) x (Guaranty Fee / (Guaranty Fee + Servicing Fee)); and
- for Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. :
total Prepayment Premium - Servicer's share (calculated per Part V, Chapter 2: Reporting and Remitting, Section 213.02D: Calculation of Servicer’s Share of Total Prepayment Premium).
If the total 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. equals the Minimum 1% Prepayment PremiumMinimum 1% Prepayment PremiumFor a prepayment, an amount equal to 1% of the UPB. , Fannie Mae’s share equals the entire remaining 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. above the Investor’sInvestor’sMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. portion.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives a portion 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. only if 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. exceeds the Minimum 1% Prepayment PremiumMinimum 1% Prepayment PremiumFor a prepayment, an amount equal to 1% of the UPB. .
The Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. share equals:
- for Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. :
(total Prepayment Premium - Investor's portion) x (Servicing Fee / (Guaranty Fee + Servicing Fee)); and
- for Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. :
total Prepayment Premium x (Servicing Fee / (Pass-Through Rate + Servicing Fee)).
The Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. may provide that any full prepayment that occurs on or after the Yield Maintenance Period End DateYield Maintenance Period End DateLast day on which a Borrower owes yield maintenance for a voluntary Mortgage Loan prepayment. but before a date specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. (typically the last calendar day of the fourth month prior to the month in which the Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. occurs), must be accompanied by 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. equal to a stated amount (usually 1% of 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. ). Neither the InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. nor the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is entitled to any portion of 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. paid on or after the Yield Maintenance Period End DateYield Maintenance Period End DateLast day on which a Borrower owes yield maintenance for a voluntary Mortgage Loan prepayment. . The entire 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. must be remitted to Fannie Mae.
| 213.03B | |
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The Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. may provide that the BorrowerBorrowerPerson who is the obligor per the Note. is not required to pay 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. in connection with a full prepayment made on or after a date specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. (typically the last calendar day of the fourth month prior to the month in which the Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. occurs).
For fixed rate 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. where the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. require a graduated 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is not entitled to retain any portion 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. . The entire 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. must be remitted to Fannie Mae.
Unless the prepayment of an ARM LoanARM LoanMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. that used Prepayment Option 1 or Prepayment Option 2, or of a Structured ARM Loan is the result of a casualty or condemnation, any prepayment made before a date specified in the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. (typically the last calendar day of the fourth month prior to the month in which the Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. occurs) must include 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. that will be shared between Fannie Mae and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. . The InvestorInvestorMBS Investor for an MBS Mortgage Loan, or Fannie Mae for a Cash Mortgage Loan. is not entitled to receive any portion 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. for either an ARM LoanARM LoanMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. or a Structured ARM Loan. In each case, Fannie Mae’s share will be a percentage determined by the following formula:
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Guaranty Fee (Guaranty Fee + Servicing Fee) |
For example, if the Guaranty FeeGuaranty FeeFee retained by Fannie Mae for credit enhancing a Mortgage Loan or assuming credit risk on a Mortgage Loan, and which may be expressed as a percentage. is 62.5 basis points and if 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. is 45 basis points, then Fannie Mae's share will be:
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62.5 (62.5 + 45) |
or |
58.14%. |
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit the portion 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. due Fannie Mae with the final 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. payment. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may retain the balance 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. .
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. is due in connection with an ARM LoanARM LoanMortgage Loan with an interest rate that periodically adjusts based on an Index per the Note or Loan Documents. with a conversion option or with a Structured ARM Loan that is converting to a fixed rate 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may not waive any portion 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. due and owing under the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , except as provided in Part III, Chapter 18: Choice Refinance Loans, Section 1803: Prepayment Premiums in connection with a Choice Refinance LoanChoice Refinance LoanMortgage Loan refinancing a Portfolio Mortgage Loan using streamlined underwriting per Part III, Chapter 18: Choice Refinance Loans. .
No portion of the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. 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. may be:
- waived by the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. ;
- used as a rebate to the BorrowerBorrowerPerson who is the obligor per the Note. , or any party related to the BorrowerBorrowerPerson who is the obligor per the Note. , for any purpose; or
- used for the payment of any expenses related to any loan used to refinance 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 214 | |
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| 214.01 | |
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Fannie Mae expects any BorrowerBorrowerPerson who is the obligor per the Note. with a Balloon Mortgage LoanBalloon Mortgage LoanMortgage Loan with periodic installments of principal and interest that do not fully amortize the Mortgage Loan, with the balance of the Mortgage Loan due in a lump sum on a specified date, usually the Maturity Date. to refinance or otherwise pay off 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 on (or before) the scheduled Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. . Failure to pay off 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 on (or before) the scheduled Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. is a default and puts the BorrowerBorrowerPerson who is the obligor per the Note. at risk that Fannie Mae will exercise any available remedy under the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. and the other Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. . Whenever a BorrowerBorrowerPerson who is the obligor per the Note. fails to pay off a Balloon Mortgage LoanBalloon Mortgage LoanMortgage Loan with periodic installments of principal and interest that do not fully amortize the Mortgage Loan, with the balance of the Mortgage Loan due in a lump sum on a specified date, usually the Maturity Date. on its 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 notify its Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). of such failure as soon as possible, and must report the balloon payment default on the Multifamily Delinquency System®. Any acceptance of a payoff amount occurring after the Balloon Mortgage LoanBalloon Mortgage LoanMortgage Loan with periodic installments of principal and interest that do not fully amortize the Mortgage Loan, with the balance of the Mortgage Loan due in a lump sum on a specified date, usually the Maturity Date. ’s stated Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. must be approved by Fannie Mae.
At least 5 days prior to the scheduled Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. 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. , 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 amount required to pay off 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. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must ensure that the payoff figure quoted to the BorrowerBorrowerPerson who is the obligor per the Note. is correct.
The Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. request for verification of the final payoff amount must be submitted to Fannie Mae at least 10 days before the scheduled Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. . To obtain Fannie Mae’s confirmation of the final payoff amount, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must submit a statement, detailing all amounts that it believes will be due and payable by the BorrowerBorrowerPerson who is the obligor per the Note. on the payoff date, including:
- 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. (as of the payoff date);
- accrued interest, up to the payoff date, broken down into the net interest portion due to Fannie Mae (calculated at the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) and the portion to be retained by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. as a 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. ;
- any unpaid late fees, if applicable; and
- any other amounts due 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. , Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or any other Mortgage Loan DocumentMortgage Loan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , including, if applicable, any unpaid fee due under any Collateral AgreementCollateral AgreementAgreement granting a security interest in Mortgage Loan collateral not covered by the Security Instrument. .
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 payoff (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 must clearly denote any such amounts so that Fannie Mae can distinguish them from amounts due exclusively to Fannie Mae. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is solely responsible for ensuring that any payoff quote given to the BorrowerBorrowerPerson who is the obligor per the Note. includes any amounts that are owed exclusively to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , as Fannie Mae will not reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for such amounts from any of the funds that the BorrowerBorrowerPerson who is the obligor per the Note. remits to cover the amounts confirmed as being due to Fannie Mae.
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 (in writing) to the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. verification request. In its response, Fannie Mae will confirm the total payoff amount due to Fannie Mae, as well as the individual items comprising such total amount, including:
- 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. ;
- the net accrued interest due Fannie Mae;
- 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. ; and
- any previously unpaid fees or other amounts owed to Fannie Mae.
Fannie Mae also will provide any pertinent instructions for completing the payoff process, including any specific instructions that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must pass along to the BorrowerBorrowerPerson who is the obligor per the Note. with the payoff quote.
To ensure that the BorrowerBorrowerPerson who is the obligor per the Note. is quoted the correct payoff amount, including any applicable accrued interest, 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. , late fees, or other amounts that might be owed 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 Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. , or the other Mortgage Loan DocumentsMortgage Loan 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 not quote a final payoff amount to the BorrowerBorrowerPerson who is the obligor per the Note. without first obtaining Fannie Mae’s confirmation of the accuracy of the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. figures.
The full payoff must be reported electronically to Fannie Mae through the eServicing System. The report of the full payment must be transmitted in time to reach Fannie Mae by the 2nd 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. of the month following the month of payoff.
| 214.04B | |
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1. Using Pass-Through Rate to Calculate Remittance to Fannie Mae
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must use the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. to calculate its P&IP&IPrincipal and interest remittance to Fannie Mae. After collecting payoff proceeds, calculated in the manner described above at the Gross Note RateGross Note RateInterest rate stated in the Loan Documents. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must subtract its 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. , calculated using a per diem rate based on a 360-day year.
2. Remittance Due on Next Remittance Cycle for Cash Mortgage Loans and Securitized Mortgage Loans
For Cash Mortgage LoansCash Mortgage LoansMortgage Loan purchased by Fannie Mae in exchange for cash. and Securitized Mortgage LoansSecuritized Mortgage LoansMortgage Loan backing an MBS, PFP MBS, or REMIC. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must follow the reporting and remitting procedures for monthly installment reporting and remitting.
| Section 215 | |
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| 215.01 | |
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| 215.01A | |
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To facilitate the return of release documents from Fannie Mae, at all times the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must maintain on file with Fannie Mae a master file copy of the Custody Document Transmittal (Form 276) completed with the following information:
- the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. nine digit ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. number;
- “MASTER FORM” entered for the Fannie Mae Loan NumberLoan Number10-digit number assigned by Fannie Mae to each Mortgage Loan. ;
- “Payoff” checked as the liquidation reason; and
- the Lender’sLender’sPerson Fannie Mae approved to sell or service Mortgage Loans. mailing address.
The completed form must be sent to Multifamily Master ServicingMultifamily Master ServicingTeam that can be contacted at multifamily_ops_servicing@fanniemae.com. . If the mailing information for the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. changes at any time, the LenderLenderPerson Fannie Mae approved to sell or service Mortgage Loans. must update the master file copy of the Custody Document Transmittal (Form 276) with Fannie Mae.
For each 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. , upon receipt of the payoff funds 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:
- refund to the BorrowerBorrowerPerson who is the obligor per the Note. any T&IT&ITaxes or assessments that may become a Lien on the Property and insurance premiums. escrow funds and any Replacement ReserveReplacement ReserveCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. funds still held by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in connection with 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. (must be accomplished within 30 days of the payoff); and
- send the following to Fannie Mae:
- if the release documents are to be sent to a different mailing address than that listed on the master file copy of the Custody Document Transmittal (Form 276) with Fannie Mae, a transaction-specific Custody Document Transmittal (Form 276), requesting Fannie Mae to return the original NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. and indicating the different address to which the release documents for that specific 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. should be sent;
- for all recorded Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. (e.g., Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. ) that require a release, the appropriate release document for the state in which 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 located; and
- a request to Multifamily Servicing to release any additional collateral still held by Fannie Mae in connection with 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. .
Fannie Mae will execute the necessary releases, and return them, along with the original NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. (appropriately marked or stamped to evidence full satisfaction), 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 return the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. to the BorrowerBorrowerPerson who is the obligor per the Note. , file the appropriate UCCUCCUniform Commercial Code termination forms and arrange to have the release documents recorded. Fannie Mae will be responsible for returning any applicable Achievement Letter of CreditAchievement Letter of CreditLetter of Credit that is released as collateral when a certain event occurs or a requirement is met (e.g., construction completion, or minimum occupancy or EGI level reached). to the issuer for cancellation.
Following its return to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. 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. and the releases for all recorded Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. , Fannie Mae will forward its file for 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 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 retain the entire 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. Servicing FileServicing FileYour file for each Mortgage Loan serviced. for 7 years after 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. payoff.
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.
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.
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.
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
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.
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. .
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.
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. .
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.
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.
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.
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.
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.
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| 216.04A | |
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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. .
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 drawer_am@fanniemae.com. ) 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. .
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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.
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. ;
(c) any unpaid late fees (if applicable);
(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.
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 | |
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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.
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.
| Section 217 | |
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NOTE: Except as otherwise required below, the reporting and remitting requirements for Cash Mortgage Loans provided in this Chapter apply to Mezzanine Loans.
For the DUS Plus Mezzanine Loan, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is required to remit to Fannie Mae via the Cash Remittance SystemCash Remittance SystemMultifamily system where you set up and maintain banking instructions for Fannie Mae’s drafting of remittances per Part V, Chapter 2: Reporting and Remitting, Section 209: Remittance Procedures. . On each remittance date the amount representing P&IP&IPrincipal and interest (adjusted to the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. ) actually collected from the Mezzanine Borrower must be remitted. The initial remittance date for any DUS Plus Mezzanine Loan is the 18th day of the month following the month in which the DUS Plus Mezzanine Loan is purchased, with monthly remittances due on the 18th day of each month thereafter.
For each DUS Plus Mezzanine Loan, the principal distribution amount remitted must include the sum of:
- the principal portion actually collected from the Mezzanine Borrower of the monthly installment due during the period beginning on the second day of the month preceding the month in which a remittance date occurs and ending on the first day of the month in which a remittance date occurs; and
- any unscheduled principal recovery collected on a DUS Plus Mezzanine Loan during the month preceding the month in which a remittance date occurs.
The interest distribution amount remitted includes the interest portion of the monthly installment (that portion actually collected from the Mezzanine Borrower), adjusted to the Pass-Through RatePass-Through RateMortgage Loan Gross Note Rate minus: for MBS Mortgage Loans, the Guaranty Fee, minus the Servicing Fee; and for Cash Mortgage Loans, the Servicing Fee. , due on the first day of the month in which a remittance date occurs or due at any time (other than the first day) during the preceding month.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must remit funds collected from the Mezzanine Borrower even if they do not represent a full payment. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may not deduct monthly Servicing FeesServicing FeesFee 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. until the entire monthly payment has been collected from the Mezzanine Borrower.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is not required to remit to Fannie Mae on the remittance date any amounts representing P&IP&IPrincipal and interest that have not been received from the Mezzanine Borrower and are, therefore, delinquent. Any delinquent payment received after the 18th calendar day of the month in which it is due must be remitted to Fannie Mae by 1:00 p.m. ET within 24 hours of its receipt.
| 217.02 | |
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For DUS Plus Mezzanine Loans, proceeds for payments-in-full, including any applicable repayment fees, must be remitted directly to the mezzanine investor within 24 hours after receipt by the DUSDUSDelegated Underwriting and Servicing ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. . The full payment must be reported to Fannie Mae by the second 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. of the month following the month in which the prepayment is received in accordance with Part V of this GuideGuideMultifamily Selling and Servicing Guide controlling all Lender and Servicer requirements unless a Lender Contract specifies otherwise. .
| Section 218 | |
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A BorrowerBorrowerPerson who is the obligor per the Note. may elect to defease its 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. only if the Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. permit defeasance. If the Borrower’sBorrower’sPerson who is the obligor per the Note. Mortgage Loan DocumentsMortgage Loan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. do not permit defeasance, defeasance 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. is not permitted.
Prior to 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. Maturity DateMaturity DateDate all Mortgage Loan amounts become fully due and payable per the Loan Documents. and during the Mortgage Loan's Defeasance Period, the BorrowerBorrowerPerson who is the obligor per the Note. may defease the entire outstanding 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. in accordance with the applicable terms and conditions of the Borrower'sBorrower'sPerson who is the obligor per the Note. Loan DocumentsLoan DocumentsAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. and the provisions of this Section.
| 218.03 | |
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To accomplish the defeasance, the following procedures must be followed:
| 218.03A | |
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ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must obtain the most current 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. documents from the Fannie Mae website. The 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. documents consist of the Defeasance Notice (Form 4622) and other closing documents required by Fannie Mae in order for the defeasance to occur.
| 218.03B | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must complete the Defeasance Notice (Form 4622) after verifying 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 eligible for defeasance and obtaining from the BorrowerBorrowerPerson who is the obligor per the Note. the date on which the BorrowerBorrowerPerson who is the obligor per the Note. desires to consummate the 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. . The Defeasance Close Date may not be more than 45 calendar days nor less than 30 calendar days after the date on which the Defeasance Notice is received 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 use the Defeasance Calculator application on the Fannie Mae web site to estimate the Defeasance Deposit and the estimated Defeasance Deposit must be inserted in the appropriate box in the Defeasance Notice. The information on the Defeasance Notice will not be final until it is confirmed by Fannie Mae. Until then, the Defeasance Deposit and other information are estimates. The Defeasance Notice will specify (a) whether a Fannie Mae debt instrument will be offered for use as the substitute collateral and, if not, that U.S. Treasury SecuritiesSecuritiesMBS, PFP MBS, or REMIC. will be the substitute collateral; and (b) whether the successor entity will be designated by Fannie Mae or BorrowerBorrowerPerson who is the obligor per the Note. , and (c) the amount of the Defeasance Commitment Fee.
To be effective, the BorrowerBorrowerPerson who is the obligor per the Note. must execute and send the Defeasance Notice to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. so that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives the Defeasance Notice no earlier than 11:00 a.m. and no later than 3:00 p.m. ET on 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must then sign and execute the Defeasance Notice and fax the Defeasance Notice and a copy 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. to be defeased to its Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). .
Fannie Mae must receive the fax by 5:00 p.m. ET on the same day that the 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. Deposit was calculated for verification by Fannie Mae.
| 218.03C | |
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A Defeasance Commitment Fee equal to 1% of the scheduled 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. as of the Defeasance Close Date, must be paid by the BorrowerBorrowerPerson who is the obligor per the Note. to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. no later than the date and time when the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives the executed Defeasance Notice 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 wire the Defeasance Commitment Fee to Fannie Mae within 24 hours after receipt of the Borrower'sBorrower'sPerson who is the obligor per the Note. executed Defeasance Notice.
Fannie Mae will verify 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. information contained in the Defeasance Notice as well as 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. eligibility for defeasance. After verification and within two (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. after the initial receipt of the Defeasance Notice from the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , Fannie Mae will sign the Defeasance Notice and fax it back to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. along with an Exhibit that details the monthly cash flows of the Fannie Mae debt instrument that will replace 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). as collateral for 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 ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will then fax the verified Defeasance Notice to the BorrowerBorrowerPerson who is the obligor per the Note. on the same day that the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. receives the verified Defeasance Notice from Fannie Mae. In the event that Fannie Mae made changes to the Defeasance Notice, the BorrowerBorrowerPerson who is the obligor per the Note. must initial the changed portions of the Defeasance Notice and fax it back to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. on that same day. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must then immediately fax the BorrowerBorrowerPerson who is the obligor per the Note. -initialed Defeasance Notice to Fannie Mae.
If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. does not
- receive the Defeasance Commitment Fee, and
- provide confirmation of the Defeasance Notice to the BorrowerBorrowerPerson who is the obligor per the Note. ,
| 218.03E | |
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On or before the Defeasance Close Date, the BorrowerBorrowerPerson who is the obligor per the Note. must deliver to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. a Defeasance Pledge Agreement (Form 4529), creating a perfected security interest in the substitute collateral in favor of Fannie Mae.
| 218.03F | |
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The BorrowerBorrowerPerson who is the obligor per the Note. must assign all its obligations and rights 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. , together with the substitute collateral, to a successor entity designated by Fannie Mae or, if not so designated by Fannie Mae, designated by BorrowerBorrowerPerson who is the obligor per the Note. and acceptable to Fannie Mae. The BorrowerBorrowerPerson who is the obligor per the Note. and the successor entity shall execute and deliver to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. a Defeasance Assignment and Assumption Agreement (Form 4528).
| 218.03G | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must deliver to Fannie Mae by no later than 10 a.m. ET, five (5) 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. before the Defeasance Close Date, the following documents:
- a Borrower's Counsel Opinion Letter (Form 6618) affirming:
- that each 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. Document constitutes the valid and legally binding obligation of the BorrowerBorrowerPerson who is the obligor per the Note. , enforceable against the BorrowerBorrowerPerson who is the obligor per the Note. in accordance with its terms;
- that the defeasance is not subject to avoidance under any applicable federal or state laws;
- that, if the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. is held by a REMIC Trust, then the defeasance has been effected in such a way that does not adversely affect the REMIC Trust; and
- such other opinions, certificates, documents or instruments as ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may reasonably request;
- the Defeasance Assignment and Assumption Agreement (Form 4528); and
- the Defeasance Pledge Agreement (Form 4529).
Transmittal of these documents shall be accompanied by a completed Multifamily Defeasance Transmittal Form (Form 4631).
| 218.03H | |
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On or before the Defeasance Close Date, the BorrowerBorrowerPerson who is the obligor per the Note. must pay to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. an amount equal to the sum of:
- the next scheduled P&IP&IPrincipal and interest payment due 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. ;
- all other sums then due and 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. , the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. and any other Loan DocumentLoan DocumentAll Fannie Mae-approved documents evidencing, securing, or guaranteeing the Mortgage Loan. ; and
- all costs and expenses incurred by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in connection with the defeasance, including any out-of-pocket fees and disbursements of the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. legal counsel.
| 218.03I | |
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If a Fannie Mae investment security will be the substitute collateral, then, on or before 3:00 p.m. ET on the Defeasance Close Date, the BorrowerBorrowerPerson who is the obligor per the Note. must pay the Defeasance Deposit (reduced by the Defeasance Commitment Fee) to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to be used by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , as the Borrower'sBorrower'sPerson who is the obligor per the Note. agent, to purchase the Fannie Mae Investment Security.
The BorrowerBorrowerPerson who is the obligor per the Note. or Closing Agent must wire the Defeasance Deposit to ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. by 3:00 p.m. ET on the Defeasance Closing Date. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must wire the Defeasance Deposit (reduced by the Defeasance Commitment Fee) to Fannie Mae for receipt by 5:00 p.m. ET on the Defeasance Closing Date.
| 218.03J | |
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Upon the Borrower'sBorrower'sPerson who is the obligor per the Note. compliance with the 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. requirements, 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). will be released from the lien of the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. . Upon release 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 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 secured by the pledge of the Substitute Collateral.
If the BorrowerBorrowerPerson who is the obligor per the Note. timely pays the Defeasance Commitment Fee and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. and the BorrowerBorrowerPerson who is the obligor per the Note. timely transmit a signed facsimile copy of the Defeasance Notice, but the BorrowerBorrowerPerson who is the obligor per the Note. fails to consummate the defeasance, Fannie Mae shall have the right to retain the Defeasance Commitment Fee as liquidated damages for the Borrower'sBorrower'sPerson who is the obligor per the Note. default and, subject to the terms and conditions 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 BorrowerBorrowerPerson who is the obligor per the Note. shall be released from all further obligation to defease the NoteNoteInstrument evidencing a Mortgage Loan obligation, including Form 6010 series, any other Fannie Mae-approved note, and all applicable addenda, schedules, and exhibits. under the given Defeasance Notice.
| 218.03L | |
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In the event that the 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. is not consummated on the Defeasance Closing Date for any reason, the BorrowerBorrowerPerson who is the obligor per the Note. must reimburse the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. for all third-party costs and expenses incurred by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in its reliance on the Defeasance Notice executed by the BorrowerBorrowerPerson who is the obligor per the Note. , within five (5) 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. after the BorrowerBorrowerPerson who is the obligor per the Note. receives a written demand for this reimbursement.
| 218.03M | |
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Fannie Mae will transfer the defeased 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 the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. servicing portfolio effective on the first day of the second month following the Defeasance Closing Date. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will be required to report and remit payments for the next scheduled P&IP&IPrincipal and interest payment collected as part of the Defeasance Closing. Thereafter, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will no longer be required to perform other servicing requirements for the defeased 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. . Beginning on the 18th calendar day of the second calendar month after the Defeasance Closing Date (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. ) until the maturity 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. will receive the remaining scheduled servicing fee for 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. minus five (5) basis points provided the Authorization for ACH Remittance (Form 4630) has been submitted.
| Section 219 | |
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On the 17th calendar day of each month, ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must take the following actions with respect to 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. :
- Report all delinquent 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. to Fannie Mae using the Delinquency Early Warning System (“DEWSDEWSMultifamily Delinquency Early Warning System used for reporting the monthly status of Non-Performing Mortgage Loans. ”), which ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may access through the eServicing System. Delinquency reporting must include delinquencies 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. on Bond Credit Enhancements, even if the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. also elects to report these delinquencies through CESIRCESIRCredit Enhancement Servicing and Investor Reporting System .
- Certify as to the delinquency status of all 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. . If a Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. 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. portfolio does not include any delinquent 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. , the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must certify to that effect.
Prior to the 17th calendar day of each month, ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. may use the “Preliminary” Case Status indicator to set up initial delinquency cases in DEWSDEWSMultifamily Delinquency Early Warning System used for reporting the monthly status of Non-Performing Mortgage Loans. .
On the 17th calendar day of each month, ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must change all "Preliminary" Case Status indicators to "Open" for all 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. still delinquent or delete remaining initial cases for all 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. that have cured. No “Preliminary” Case Status cases can remain as of the 17th calendar day of each month.
If the 17th calendar day of a month falls on a weekend or holiday, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report and certify 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. .
ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must complete the “comments section” in each report with important additional information regarding the delinquent 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. including, at a minimum, the following:
- the Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. attempts to contact the delinquent BorrowerBorrowerPerson who is the obligor per the Note. ;
- the cause for the missed payment(s);
- whether payment is expected before the end of the month;
- the likelihood of the BorrowerBorrowerPerson who is the obligor per the Note. making the next month’s payment;
- if the payment will not be made before the end of the month of default, whether the BorrowerBorrowerPerson who is the obligor per the Note. will voluntarily turn over the monthly net operating income 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 willingness of the BorrowerBorrowerPerson who is the obligor per the Note. to work with the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to resolve the delinquency; and
- whether 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 Special Serviced by Fannie Mae's Special Asset ManagementSpecial Asset ManagementTeam performing Fannie Mae’s Special Servicing that can be contacted at multifamily_sam@fanniemae.com. (SAM) group (Primary Risk Mortgage LoansPrimary Risk Mortgage LoansMortgage Loan where Fannie Mae bears all losses or you and Fannie Mae share losses. ) or the Servicers' Special Servicing group (Secondary Risk Mortgage LoansSecondary Risk Mortgage LoansMortgage Loan where you bear all losses until your recourse obligation is exhausted. ).
ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must update at least once per week all delinquency reports with an “Open” status indicator.
ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report, on a quarterly basis, the balances of 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. collateral held by ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in their Custodial AccountsCustodial AccountsAccounts established by the Servicer for depositing P&I payments, T&I funds, Collateral Agreement deposits, and other similar funds. using Collateral Submission Report (Form 4813). CollateralCollateralProperty, Personal Property, or other property securing a Mortgage Loan. balances that must be included in the quarterly reporting include balances for all Custodial AccountsCustodial AccountsAccounts established by the Servicer for depositing P&I payments, T&I funds, Collateral Agreement deposits, and other similar funds. whether the collateral is held as cash, securities or letters of credit.
| 220.01 | |
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Except as noted in Part V, Chapter 2: Reporting and Remitting, Section 220.04: What to Report, balances in P&I Custodial AccountsP&I Custodial AccountsCustodial Account for principal and interest deposits. are excluded from this reporting requirement.
Balances for any original Letters of CreditLetters of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. held by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must be reported. Balances for any original Letter of CreditLetter of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. held by Fannie Mae are not required to be reported.
| 220.03 | |
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If the form of collateral is securities or Letters of CreditLetters of CreditLetter of Credit approved by Fannie Mae per Part I, Chapter 2: Mortgage Loan, Section 204: Letters of Credit. , ServicersServicersPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report the balances on a fair value basis (the price that would be received to sell an asset in a transaction between market participants).
| 220.04 | |
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CollateralCollateralProperty, Personal Property, or other property securing a Mortgage Loan. that must be reported using the Collateral Submission Report (Form 4813) includes:
- Short Term
- any Replacement ReservesReplacement ReservesCustodial Account the Borrower funds during the Mortgage Loan term for Replacements. or repair escrows;
- insurance proceeds held pending repair or damage to 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). ; or
- condemnation proceeds received in a condemnation action related to 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). .
- Long Term
- any operating deficit or debt service reserve; or
- NCFNCFOn an annual basis or any specified period, the total Net Operating Income, minus the full amount underwritten for Replacement Reserve expense, regardless of whether deposits will be made (per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and… sweeps – to the extent NCFNCFOn an annual basis or any specified period, the total Net Operating Income, minus the full amount underwritten for Replacement Reserve expense, regardless of whether deposits will be made (per Part II, Chapter 2: Valuation and Income, Section 203: Income Analysis and the applicable products and… exceeds monthly P&IP&IPrincipal and interest remitted to Fannie Mae in the ordinary course.
- Balances in any T&I Custodial AccountT&I Custodial AccountCustodial Account for the deposit of T&I and other impound escrow funds. .
- Other
- any other escrow, collateral or achievement funds governed by an agreement with the BorrowerBorrowerPerson who is the obligor per the Note. ;
- any holdback of 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. proceeds; or
- any tenant security deposits held by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. .
| 220.05 | |
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The Collateral Submission Report (Form 4813) must be submitted to Servicer’sServicer’sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. Fannie Mae RepresentativeFannie Mae RepresentativeFannie Mae personnel who assist you with various business matters (e.g., Fannie Mae Deal Team, pricing, delivery, servicing, asset management, etc.). within thirty (30) days after the end of each calendar quarter.
| Section 221 | |
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| 221.01 | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must comply with Internal Revenue Service reporting requirements for:
- reporting the receipt of $600 or more of interest payments from any BorrowerBorrowerPerson who is the obligor per the Note. who is a natural person (IRS Form 1098);
- filing Statements for Recipients of Miscellaneous Income (IRS Form 1099-MISC) to report payments of fees and related expenses to attorneys and other third parties in connection with foreclosure or liquidation proceedings in connection with 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. and the related PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). ;
- filing notices of Acquisition or Abandonment of Secured Property (IRS Form 1099-A) to report the acquisition of 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). by foreclosure or acceptance of a deed-in-lieu or by a Borrower’sBorrower’sPerson who is the obligor per the Note. abandonment of a property; and
- filing notices of Cancellation of Debt (IRS Form 1099-C) to report the cancellation of any part of a Borrower’sBorrower’sPerson who is the obligor per the Note. indebtedness.
Should the Internal Revenue Service change the reporting requirements in connection with any of IRS Form 1098, IRS Form 1099-MISC, IRS Form 1099-A or IRS Form 1099-C, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must comply with those changed reporting requirements, notwithstanding anything to the contrary contained in this Chapter. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should contact Fannie Mae if it believes any portion of this Chapter to be in conflict with such Internal Revenue Service reporting requirements.
| 221.02 | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report all attorney (or trustee) fees paid by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. -retained attorneys or trustees or to Fannie Mae-retained attorneys or trustees for handling foreclosure proceedings, by filing Form 1099-MISC (Miscellaneous Income) with the Internal Revenue Service and other parties. This form must be filed in the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. name, using its Internal Revenue Service tax identification number.
If the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. pays for any expenses authorized by Fannie Mae for the maintenance, repair, or marketing of an REOREOA Property or interest in a Property acquired by Fannie Mae or on behalf of the MBS Trust, through a Foreclosure Event where title to a Property or interests in that Property are transferred to Fannie Mae or the MBS Trust. PropertyPropertyMultifamily residential real estate securing the Mortgage Loan, including the fee simple or Leasehold interest, Improvements, and personal property (per the Uniform Commercial Code). , or when the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. pays directly any business that is not a corporation for recurring maintenance costs, minor repair costs, or routine costs in connection with an REOREOA Property or interest in a Property acquired by Fannie Mae or on behalf of the MBS Trust, through a Foreclosure Event where title to a Property or interests in that Property are transferred to Fannie Mae or the MBS Trust. 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 report such payments to the Internal Revenue Service. To accomplish this, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must prepare an IRS Form 1099-MISC (Miscellaneous Income) for the appropriate tax year and submit it to the Internal Revenue Service and to the individual payee. This form must be filed in the Servicer'sServicer'sPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. name, using its Internal Revenue Service taxpayer identification number.
| 221.03A | |
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The Internal Revenue Service requires that information returns be filed when Fannie Mae (or a third party) acquires an interest in 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). in full or partial satisfaction 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. or when Fannie Mae or the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has reason to know that 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). has been abandoned. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must file these notices on Fannie Mae's behalf, using IRS Form 1099-A (Acquisition or Abandonment of Secured Property), for all applicable 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. (including 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. participations if Fannie Mae's percentage ownership of such 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 50% or greater).
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must satisfy the reporting requirements for the “owner of record” (instead of on Fannie Mae's behalf) when the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. purchased a delinquent 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 Fannie Mae before 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). was acquired by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. in full or partial satisfaction 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. .
For purposes of filing these reports:
- Fannie Mae (or the “owner of record”) acquires an 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). when any redemption period that follows a foreclosure sale ends without redemption rights being exercised (or when Fannie Mae accepts a deed-in-lieu of foreclosure);
- A third party acquires an 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). at the foreclosure sale; and
- Abandonment occurs when Fannie Mae or the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. has “reason to know” from “all facts and circumstances concerning the status 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). ” that the BorrowerBorrowerPerson who is the obligor per the Note. intended to discard or has permanently discarded 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). from use. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. , however, will have an additional three months before its reporting obligation arises if the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. expects foreclosure proceedings to begin within the three months after determination that abandonment has occurred.
After an event that triggers a reporting requirement occurs, IRS Form 1099-A must be filed on or before February 28 (or March 31 if filing electronically) of the year following the calendar year in which the event occurred. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. also must furnish the BorrowerBorrowerPerson who is the obligor per the Note. with an information statement on or before January 31 of that year. The requirement for notifying the BorrowerBorrowerPerson who is the obligor per the Note. can be satisfied by sending Copy B of a completed IRS Form 1099-A to the Borrower'sBorrower'sPerson who is the obligor per the Note. last known address. When the form is filed on Fannie Mae's behalf, it must show Fannie Mae's name, address, and federal identification number (52-0883107), and include a legend stating that the information is being reported to the Internal Revenue Service. If it is filed by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. on its own behalf or for the “owner of record,” the name, address, and identification number of the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. or owner of record, respectively, must be provided instead.
| 221.03B | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for completing the IRS Form 1099-A accurately, for filing it with the Internal Revenue Service, and for providing the information to the BorrowerBorrowerPerson who is the obligor per the Note. and to Fannie Mae by the required dates. If the Internal Revenue Service penalizes Fannie Mae because a ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. failed to file a return or filed an incorrect return or late return, Fannie Mae will require the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to reimburse Fannie Mae for any penalty fees the Internal Revenue Service assesses (unless the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. can document that it met the filing requirements).
Information that must be reported on IRS Form 1099-A includes:
- the Borrower'sBorrower'sPerson who is the obligor per the Note. taxpayer identification number (the Social Security number if the borrower is a natural person);
- the date of acquisition of an 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). or the date the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. acquired knowledge of the abandonment;
- the outstanding 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. ;
- a general description 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). ; and
- whether the BorrowerBorrowerPerson who is the obligor per the Note. is personally liable for the debt and, if personally liable, the fair market value 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). at the time of acquisition.
| 221.04A | |
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The Internal Revenue Service requires certain mortgage holders, including Fannie Mae, to file information returns when $600 or more of 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. is cancelled. Except as provided in Part V, Chapter 2: Reporting and Remitting, Section 221.04D: Exceptions to IRS Form 1099-C Reporting, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must file these returns on Fannie Mae's behalf, using IRS Form 1099-C, for all applicable 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. (including 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. participations if Fannie Mae's percentage ownership of such 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 50% or greater). If, in the same calendar year, 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. is canceled in connection with a foreclosure or abandonment of secured property, it is not necessary to file both Form 1099-A and Form 1099-C for the same BorrowerBorrowerPerson who is the obligor per the Note. . Only Form 1099-C need be filed, and the Form 1099-A filing requirement for the BorrowerBorrowerPerson who is the obligor per the Note. will be met by completing boxes 4, 5, and 7 on Form 1099-C.
A debt is cancelled (in whole or part) when any of the following occur:
- discharge in bankruptcy under Title 11 of the U.S. Code;
- receivership, foreclosure, or similar federal or state court proceeding makes the debt unenforceable;
- the statute of limitations applicable to collecting the debt expires (if so determined by a court and any appeal period has expired), or expiration of the statutory period for filing a claim or beginning a deficiency judgment proceeding;
- foreclosure remedies by law end or bar Fannie Mae’s right to collect the debt (e.g., foreclosure by exercise of the “power of sale” in the Security InstrumentSecurity InstrumentInstrument creating a lien or encumbrance on 1 or more Properties and securing the Loan Document obligations. );
- probate or similar proceeding cancels or extinguishes the debt;
- Fannie Mae and the BorrowerBorrowerPerson who is the obligor per the Note. agree to cancel the debt at less than full consideration;
- a decision or defined policy of Fannie Mae causes collection activity to be discontinued and the debt to be cancelled; or
- expiration of a “non-payment testing period”.
The Internal Revenue Service presumes that a debt is cancelled during a calendar year if no payment has been received on 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. during a period (the “non-payment testing period”) of 36 months, plus the number of calendar months when collection activity was precluded by a stay in bankruptcy or similar bar under state or local law. The presumption may be rebutted, however, if there has been significant, bona fide collection activity at any time during the calendar year, or if facts and circumstances, existing as of January 31 of the calendar year following expiration of the 36-month period, indicate that the indebtedness has not been discharged.
| 221.04C | |
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. is responsible for completing the Cancellation of Debt (IRS Form 1099-C) accurately, and for filing it with the Internal Revenue Service and providing the information to the BorrowerBorrowerPerson who is the obligor per the Note. and to Fannie Mae by the required dates. The form must be filed on or before February 28 (or March 31 if filing electronically) of the year following the calendar year in which the discharge of indebtedness occurs.
If the Internal Revenue Service penalizes Fannie Mae because the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. failed to file a return or filed an incorrect or late return, Fannie Mae will require the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. to reimburse Fannie Mae for any penalty fees the Internal Revenue Service assesses (unless the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. can document that it met the filing requirements).
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. also must furnish the BorrowerBorrowerPerson who is the obligor per the Note. with an information statement before January 31 of that year. The requirement for notifying the BorrowerBorrowerPerson who is the obligor per the Note. can be satisfied by sending Copy B of a completed IRS Form 1099-C (or a substitute statement that complies with Internal Revenue Service requirements for substitute forms) to the Borrower'sBorrower'sPerson who is the obligor per the Note. last known address, and the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must send Copy C to those states that require it. When the form is filed on Fannie Mae's behalf, it must show Fannie Mae's name as the “Creditor,” Fannie Mae's address and federal identification number (52-0883107), and include a legend identifying the statement as important tax information that is being furnished to the Internal Revenue Service.
Information that must be reported on IRS Form 1099-C includes:
- the Borrower'sBorrower'sPerson who is the obligor per the Note. name, address, and taxpayer identification number (the Social Security number if the borrower is a natural person);
- the date the debt was cancelled;
- the amount of the cancelled debt, which does not include interest or any amount received in satisfaction of the debt from a foreclosure sale or other means;
- a description of the debt, such as “mortgage loan,” and a description 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). if a combined IRS Form 1099-C and 1099-A is filed;
- whether the BorrowerBorrowerPerson who is the obligor per the Note. is personally liable for the debt;
- whether the debt was cancelled in bankruptcy; and
- the fair market value 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). if a combined IRS Form 1099-C and 1099-A is filed.
If the cancelled 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. had an original principal amount of $10,000 or more, was originated after 1994, and involves BorrowersBorrowersPerson who is the obligor per the Note. who are jointly and severally liable for the debt, a separate information return for each BorrowerBorrowerPerson who is the obligor per the Note. must be filed, and each return must report the entire amount of the cancelled debt. 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. was originated prior to January 1, 1995, or if the original principal amount of the cancelled 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. was less than $10,000, and if there are multiple BorrowersBorrowersPerson who is the obligor per the Note. , reporting is required only with respect to the primary (or first-named) BorrowerBorrowerPerson who is the obligor per the Note. . In addition, only one information return is required, regardless of the origination date or the original principal amount, if the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. knows, or has reason to know, that co-Borrowers were husband and wife living at the same address when 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. was originated, and does not know or have reason to know that such circumstances have changed when 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 cancelled.
Interest. Interest need not be reported. If it is reported as part of the cancelled debt, the IRS Form 1099-C instructions require that it be shown in a separate box on the form.
Non-principal amounts. Cancellation of amounts other than stated principal, including penalties, fines, fees, and administrative costs charged to the BorrowerBorrowerPerson who is the obligor per the Note. , need not be reported.
Release of a co-Borrower. IRS Form 1099-C need not be filed when one BorrowerBorrowerPerson who is the obligor per the Note. is released from 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. as long as the remaining BorrowersBorrowersPerson who is the obligor per the Note. are liable for the full 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. .
Guarantor or surety. A guarantor or surety (i.e., any GuarantorGuarantorKey Principal or other Person executing a Payment Guaranty, Non-Recourse Guaranty, or any other Mortgage Loan guaranty. or 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. executing a Non-Recourse GuarantyNon-Recourse GuarantyGuaranty executed by a Key Principal on Form 4501 series or Form 6015 series, or approved by Fannie Mae. or a Payment GuarantyPayment GuarantyGuaranty executed by a Key Principal on Form 4502 series or Form 6020 series, or approved by Fannie Mae. ) is not a BorrowerBorrowerPerson who is the obligor per the Note. for purposes of the debt cancellation reporting requirements, so IRS Form 1099-C is never required.
If, in the same calendar year, 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 cancelled in connection with the acquisition or abandonment of the same 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 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. , filing a timely and accurate IRS Form 1099-C will satisfy the requirement to file an IRS Form 1099-A.
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The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must report IRS Forms 1099-C and 1099-A information on magnetic media and must do so on Fannie Mae's behalf. Even though the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. reports to the Internal Revenue Service on magnetic media, it is still responsible for providing a hard copy of the IRS Forms 1099-C or 1099-A, as applicable, to the BorrowerBorrowerPerson who is the obligor per the Note. (Copy B) and to those states that require it (Copy C). Copy B must be sent to the BorrowerBorrowerPerson who is the obligor per the Note. no later than January 31.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must review each Borrower’sBorrower’sPerson who is the obligor per the Note. Form W-9 for validity and request a new Form W-9 if any form is invalid. A valid W-9 will include the Borrower’sBorrower’sPerson who is the obligor per the Note. name, tax identification number, date, and signature. In preparing Forms 1099-C or 1099-A, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must (i) utilize the IRS TIN Matching program and perform tax identification number matching for all United States non-exempt BorrowersBorrowersPerson who is the obligor per the Note. in all circumstances, (ii) notify Fannie Mae of any BorrowerBorrowerPerson who is the obligor per the Note. that is identified as an unsuccessful TIN Match prior to preparing Form 1099, and (iii) follow up with any BorrowerBorrowerPerson who is the obligor per the Note. whose name and tax identification number combination fail the IRS TIN Match. The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. should also provide to Fannie Mae its TCC (Transmittal Control Code) at the beginning of each year, which will allow Fannie Mae to communicate to the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. any errors on its 1099 filings.
The ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. does not need to send Fannie Mae a copy of the magnetic media filed by the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. with the Internal Revenue Service. However, to ensure that Fannie Mae can identify the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. and the loan number for a specific 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. should the Internal Revenue Service contact Fannie Mae for additional information or clarification, the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. must:
- insert the following header information when the IRS Form 1099-C or 1099-A, as applicable, is filed on Fannie Mae's behalf:
- Fannie Mae on the first “Payer” line; and
- the Fannie Mae loan number for the related 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 line for the “Payer's account number for Payee”; and
- within thirty (30) days after filing with the Internal Revenue Service, send an email to Fannie Mae at multifamily_1099_reporting@fanniemae.com, containing a summary of IRS Forms 1099-C or 1099-A, as applicable, to notify Fannie Mae what the ServicerServicerPrimary Person servicing the Mortgage Loan, including the originator, seller, or a third party. reported to the Internal Revenue Service on magnetic media.