Selling Guide

Published June 3, 2020

The Selling Guide is organized into parts that reflect how lenders generally categorize various aspects of their business relationship with Fannie Mae. To begin browsing, select from any of the sections below. You may also download the entire Selling Guide in PDF format.

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D2-1-01, General Information on Fannie Mae QC Reviews (04/03/2019)


This topic contains general information on Fannie Mae's QC reviews, including:


Fannie Mae’s QC Policy

Fannie Mae has QC policies and procedures in place for its review of performing and non-performing mortgage loans. Fannie Mae uses a statistically valid approach in selecting a random sample of new mortgage loan deliveries for review. The random sample is augmented with targeted, discretionary sampling, which aids in the measurement of the overall quality of loan deliveries. The QC process evaluates loan files on a comprehensive basis with the primary focus of confirming that mortgage loans meet Fannie Mae’s underwriting and eligibility requirements. The satisfactory conclusion of QC reviews may also result in mortgage loans being eligible for relief from enforcement for breaches of certain representations and warranties. See A2-3.2-02, Enforcement Relief for Breaches of Certain Representations and Warranties Related to Underwriting and Eligibility, for additional information.

The QC process also provides lenders with data and feedback about the quality of their loan origination process. The goal is to engage lenders in frequent, meaningful exchanges of information about trends in the quality of delivered loans and to inform lenders about significant underwriting deficiencies identified through the review process. Together, Fannie Mae and its lenders should share a commitment to improving the quality of loan originations.

Fannie Mae’s QC policies are administered by its Loan Quality Center. The selection process may change at any time to address risk concerns.

As a component of overall loan quality, the Data Validation Center team reviews loan data exceptions that are identified after Fannie Mae acquires the loan. This includes and data exceptions that may be found through reviews. The Data Validation Center works with lenders to research data exceptions and submit related data corrections. In some instances, the data change review may lead to a full underwriting review if eligibility concerns are identified or the data exception cannot be resolved. See C1-2-01, General Information on Delivering Loan Data and Documents, for additional information.


Fannie Mae QC Reports

Fannie Mae provides lenders with ongoing feedback about their overall QC performance. The feedback identifies defect types, reporting on frequent or common defects, and describes quality trend analyses and significant underwriting deficiencies identified through the QC loan file review process. This information is provided through a variety of methods that range from regular electronic transmissions to more formal periodic discussions.

The detailed loan-level reports that lenders receive identify significant defects, findings, and loans with no identified defects.

Fannie Mae’s quality control process provides lenders with a holistic view of loan quality by identifying loans with significant defects as well as loans that had findings that do not affect the overall eligibility. Fannie Mae believes that providing this additional feedback supplies lenders with an important source of information that can lead to improving loan quality in the future. At times this reporting may contain nonpublic personal information (NPI). Fannie Mae shares this NPI with lenders in compliance with permitted purposes under applicable privacy laws. See A3-4-01, Confidentiality of Information, for additional information.

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