Fannie Mae Updates Servicer Requirements for REO Properties
To simplify the post-foreclosure process and reduce Servicers’ expenses, Fannie Mae previously accepted responsibility for the payment of various expenses for acquired properties. The party responsible for payment, in some cases, was dependent upon the date of foreclosure sale or executed Mortgage Release. According to a recent Servicing Notice, unless otherwise directed, Fannie is assuming responsibility for the payment of all property taxes, ground rents, as well as fees and assessments invoices by an HOA, condo association, or co-op corporation once the foreclosure sale or Mortgage Release occurs, without regard to the occurrence date, as follows:
- For the payment of HOA and condo association fees and assessments for all acquired properties, effective July 1, 2019; and
- For the payment of co-op corporation fees and assessments for all acquired properties, effective November 1, 2019.
These changes apply to forward mortgage loans and reverse mortgage loans.
To review the impacted Guide section and associated revisions, see Fannie Mae Servicing Guide Sections E-4.3-01, Managing the Property Post-Foreclosure Sale.
Previously, Proctor Financial published a similar announcement for Freddie Mac. To review the prior publication, click here.
Proctor will continue to monitor this topic and provide updates as they develop.