Today the Federal Housing Finance Agency ("FHFA") announced a Servicing Alignment Initiative directed at Fannie Mae and Freddie Mac to establish consistent mortgage loan servicing and delinquency management requirements for loan servicers acting on behalf of Fannie Mae and Freddie Mac. The directive requires Fannie Mae and Freddie Mac to align servicing requirements in four key areas: (1) borrower contact, (2) delinquency management practices, (3) loan modifications, and (4) foreclosure timelines. Additionally, incentives and sanctions are being introduced to reinforce effective servicer execution in these areas.
Investors should consult the announcement for specific details pertaining to this servicing alignment. Fannie Mae will revise its respective servicing guidelines to make specific changes consistent with this alignment. It is anticipated that updated Fannie Mae guidelines will be issued to servicers during the 2nd quarter of 2011.
Investors may also contact our Fixed-Income Securities Helpline at 1-800-BEST-MBS (1-800-237-8627) if they have additional questions.
Originally Published: April 28, 2011