Fannie Mae issued Servicing Guide Announcement SVC-2019-04 (Announcement), clarifying eligibility and documentation requirements related to partial lien releases. Per the Announcement:
- An appraisal is now required to evaluate a partial release request and to determine the amount of any required principal curtailment, as applicable;
- Partial release requests that increase the loan-to-value (LTV) ratio of a mortgage loan may not be approved without requiring a principal curtailment to maintain the pre-release LTV ratio, provided the post-release LTV ratio is less than 60%; and
- The Application for Release of Security (Form 236) has been streamlined.
Fannie Mae also updated requirements relating to internal records when a regular or special servicing option MBS mortgage loan has been reclassified.
In addition, the Investor Reporting Manual has been updated to state that when determining the minimum pass-through rate (PTR) using the “bottom-up” calculation method, in the absence of a stated PTR floor, the required margin becomes the PTR floor.
The clarified eligibility and documentation requirements related to partial lien releases are effective October 1, 2019. All other updates are effective immediately.
Click Here to View the Fannie Maw Servicing Guide Announcement SVC-2019-04
