E-2.3-06, Responding to Bankruptcies Identified After Foreclosure Sale (07/14/2021)

When the servicer learns after the foreclosure sale date that a borrower has filed for bankruptcy, regardless of the date of the bankruptcy filing, the servicer must submit the Bankruptcy Notification Template to Fannie Mae’s SF CPM division (see F-4-02, List of Contacts F-4-02, List of Contacts) within two business days.

The following table describes when the servicer is responsible for selecting and monitoring the law firm to handle a bankruptcy proceeding identified after a foreclosure sale.

If the bankruptcy is filed…	And...	Then the servicer…
after the foreclosure sale date	the filing is after any applicable redemption expiration or confirmation/ratification completion, or there was no redemption period or confirmation/ratification	is not responsible for selecting and monitoring the law firm that will handle the post-foreclosure sale bankruptcy proceeding.
after the foreclosure sale date	the filing is prior to redemption expiration or confirmation/ratification completion, as applicable	is not responsible for selecting and monitoring the law firm that will handle the post-foreclosure sale bankruptcy proceeding unless notified to do so by Fannie Mae.
on or before the foreclosure sale date	the servicer has confirmed the REOgram to Fannie Mae	is responsible for selecting and monitoring the law firm that will handle the bankruptcy proceeding if notified to do so by Fannie Mae, or when Fannie Mae eliminates the REOgram as a result of the bankruptcy filing.
on or before the foreclosure sale date	the servicer has not confirmed the REOgram to Fannie Mae	is responsible for selecting and monitoring the law firm that will handle the bankruptcy proceeding.