Servicing Guide

Published June 13, 2018

E-3.2-04: Postponing Foreclosure Referral for Mortgage Loans Not Secured by a Principal Residence (08/17/2016)

The servicer may postpone foreclosure referral of property not secured by a principal residence beyond the 120th day of delinquency upon receipt of a complete BRP. For additional information regarding required referral timelines for mortgage loans secured by a principal residence, see E-1.2-02, Timing of the Foreclosure Referral for Mortgage Loans Generally.

The following table provides Fannie Mae requirements for postponement of foreclosure referral beyond the 120th day of delinquency for mortgage loans not secured by a principal residence.

If… Then the servicer…

a complete BRP is received

must delay the foreclosure referral up to 30 days to complete an evaluation.

the servicer makes a retention offer to the borrower, including a Trial Period Plan, that is based on a complete BRP

must delay the foreclosure referral up to 14 days to allow the borrower to respond to the offer.

The borrower may indicate acceptance of the offer as follows:

  • verbally,

  • in writing (including email responses), or

  • by remitting a payment.

a payment is required under the terms of a retention offer that has been extended, including a Trial Period Plan, and the borrower indicates acceptance either verbally or in writing within 14 days of the date of the offer

must delay the foreclosure referral until the last day of the month in which the first payment is due under the terms of the retention offer.

the servicer receives the first payment in accordance with the terms of a Trial Period Plan

must delay the foreclosure referral until the borrower breaches the Trial Period Plan.

the servicer receives the first payment in accordance with the terms of a repayment or forbearance plan

must delay the foreclosure referral until the borrower breaches the plan.

Verbal or written acceptance, without payment or execution of required documents, serves only to postpone foreclosure referral. Except for those forbearance or repayment plans for which a written agreement may not be required, a workout arrangement must not be consummated without executed documents. See E-3.4-01, Suspending Foreclosure Proceedings for Workout Negotiations for additional information. The servicer must not postpone foreclosure referral due to the review of a borrower inquiry.

Related Announcements

The following table provides references to Announcements that are related to this topic.

Announcements Issue Date
Announcement SVC–2016–07 August 17, 2016