Fannie Mae Announces Miscellaneous Servicing Policy Updates

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On March 27, Fannie Mae issued Servicing Guide Announcement SVC-2013-06, which announces policy updates regarding (i) redelivery of balloons, (ii) property value ordering process, and (iii) Mortgage Release and REOgram Submissions. The announcement states that Fannie Mae is eliminating Servicing Guide procedures for removing a balloon mortgage loan from an MBS pool when a refinance is effective after the balloon maturity date, and that servicers should contact their Investor Reporting Business Analyst for specific instructions on the process for past-due balloon mortgage loans serviced in a special servicing option MBS pool. The announcement also provides detailed instructions about a new servicer requirement to place orders directly with Fannie Mae (i) to determine the market value of property for short sales, and (ii) for Mortgage Releases and foreclosure sale bidding, if required by Fannie Mae or a mortgage insurer. Finally, effective immediately, servicers are no longer required to obtain recordation of the release of the subordinate lien within 60 days of the borrower’s acceptance of the offer for a Mortgage Release and instead, evidence of recordation of the subordinate lien release will be required with submission of the REOgram.