FNMA Servicing Notice: Standard Streamlined Modifications Rate Adjustment
Investor Update: On July 31, Fannie Mae issued a Servicing Notice subtitled Fannie Mae Standard and Streamlined Modifications Rate Adjustment.
Fannie Mae Standard and Streamlined Modifications Rate Adjustment
The terms of Fannie Mae standard and streamlined loan modifications for conventional mortgage loans require that the modified interest rate be set to the rate established by Fannie Mae. As noted in the Servicing Guide, Part VII, Section 602.02.05: Conventional Mortgage Loan Modification Terms, Fannie Mae reviews this loan modification rate periodically and may adjust it based on market conditions.
With this Notice, Fannie Mae is adjusting the required interest rate for Fannie Mae standard and streamlined loan modifications. The new loan modification rate is posted on Fannie Mae’s website.
Servicers are required to implement the new loan modification rate for all Fannie Mae mortgage loans approved for Fannie Mae standard or streamlined loan modifications on or after September 1, 2013. The “approved” date is the date on which the servicer completes its evaluation of the borrower and has determined the borrower will be offered a standard or streamlined loan modification Trial Period Plan, as applicable.
Servicers are reminded that the interest rate used for the permanent loan modification must be the same interest rate reflected in the borrower’s Trial Period Plan.
NOTE: Loan Modification requests previously approved at the prior modification rate, are not eligible to be resubmitted for approval under the new modification rate.
To view the online notice, please click here.
Safeguard Properties is the largest mortgage field services company in the U.S. Founded in 1990 by Robert Klein and based in Valley View, Ohio, the company inspects and maintains defaulted and foreclosed properties for mortgage servicers, lenders, and other financial institutions. Safeguard employs approximately 1,700 people, in addition to a network of thousands of contractors nationally. Website: www.safeguardproperties.com.