I delivered a loan that does not meet the sale requirements for a loan in forbearance outlined in Lender Letter LL-2020-06. How will these be handled?
Lenders must self-report any loan that did not meet the requirements for the sale of loan in forbearance set forth in LL-2020-06 in accordance with self-reporting provisions set forth in Selling Guide D1-3-06, Lender Post-Closing Quality Control Reporting, Record Retention, and Audit. (Also see Q. “How does a lender self-report loans to Fannie Mae?” for additional information about self-reporting.)
Fannie Mae will require the responsible party (“lender”) to remedy the loan as described below.
|Prior to 5/1/2020||The loan meets all of the eligibility requirements of LL-2020-06, including note date, loan purpose, and pay history requirements, except that the delivery date was prior to 5/1/20||The lender may elect to pay the applicable LLPA identified in LL-2020-06 or repurchase the loan.|
|Prior to 5/1/2020||The loan does not meet note date, loan purpose, or pay history requirements of LL-2020-06.||The lender must repurchase the loan.|
|On or after 5/1/2020||The loan does not meet note date, loan purpose, or pay history requirements of LL-2020-06.||The lender must repurchase the loan.|
The remedies set forth above are subject to the following conditions:
- In the scenario where the lender may elect a remedy, that remedy must be applied to all loans meeting those conditions and must be applied equally across both Fannie Mae and Freddie Mac.
- All whole loan deliveries are subject to the premium recapture requirements outlined in the Selling Guide, C1-1-01, Execution Options (Premium Pricing Recapture).
- For repurchased loans, Fannie Mae will require indemnification for losses arising from investor claims due to prepayment.