C-2.2-02, Assuming Responsibility for Conversion Notice Errors (11/12/2014)

If a borrower questions why the servicer did not provide notification of an upcoming opportunity to exercise a conversion to a fixed rate mortgage loan option and the borrower was entitled to such notification under Fannie Mae’s policy, the servicer must immediately offer the borrower the option of converting, provided that the borrower met the eligibility criteria on the option date.

The servicer must follow the procedures in Correcting Conversion Notice Errors in F-1-01, Servicing ARM LoansF-1-01, Servicing ARM Loans to verify the correct interest rate.