Fannie Mae issued Servicing Guide Announcement SVC-2017-10 (Announcement), setting forth updates to the Servicing Guide. Per the Announcement, Fannie Mae has updated the Servicing Guide with respect to transfers of ownership, release of liability, and assumptions. The updated Servicing Guide: removes the owner-occupancy requirement for transfers of ownership that are exempt from a due-on-transfer clause; allows post-origination transfers into a limited liability company (LLC) under certain conditions; permits servicers to use Desktop Underwriter for purposes of determining whether a transferee’s credit and financial capacity are acceptable to release the borrower of liability; requires servicers to review an exempt transferee for a mortgage loan modification as if the transferee was a borrower (provided the servicer determines that a mortgage loan modification is an appropriate workout option for the exempt transferee) and offer the transferee a Trial Period Plan if the transferee is eligible for a mortgage loan modification without obtaining prior written approval. In addition, the Servicing Guide updates: revise remittance codes for the Cash Remittance System; reorganize requirements in Chapter D1-3 (Providing Assistance to a Borrower Impacted by a Disaster Event), and move content relating to transfer of ownership, release of liability and assumption to reduce duplication and provide a more logical structure to the Servicing Guide. Servicers must implement the updated transfer of ownership, release of liability, and assumption provisions by March 1, 2018 (however, servicers are encouraged to implement the provisions immediately). All other updates are effective immediately.
Click here to view the Fannie Mae Servicing Guide Announcement SVC-2017-10
