E-1.3-02, Reporting Non-Routine Litigation to Fannie Mae (05/10/2023)

Non-routine litigation must be reported to Fannie Mae’s Legal department using the Non-Routine Litigation Form (Form 20) within two business days of the servicer receiving notice of the litigation, except with respect to the following three categories of loan-level challenges:

• a challenge to the standing of the servicer to conduct foreclosures or bankruptcies that, if successful, could create negative legal precedent with an impact beyond the immediate case;

• a challenge to the methods by which MERS does business or its ability to act as nominee under a mortgage; or

• any claim invoking HAMP as a basis to challenge a foreclosure.

With respect to these three categories of loan-level challenges, it is not necessary for the servicer to notify Fannie Mae until

• the borrower seeks summary judgment on such a challenge,

• briefing is required in response to such a challenge, or

• the issue is expected to be raised at a scheduled trial.