Fannie Mae Servicing Guide SVC 2010 18
December 21st, 2010
Fannie Mae issued Servicing Guide Announcement SVC-2010-18 titled, Technology Fees and Foreclosure and Bankruptcy Referrals.
Technology Fees and Foreclosure and Bankruptcy Referrals
Introduction
This Announcement amends Fannie Mae requirements regarding technology usage and electronic invoice submission charges to attorneys and trustees and foreclosure and bankruptcy referrals.
Servicing Guide, Part VII, Section 501.03: Allowable Attorneys Fees, and Part VIII, Section 104.04: Attorney (or Trustee) Fees
As compensation for servicing mortgages for Fannie Mae, Fannie Mae pays the servicer servicing fees and allows it to retain late charges, fees charged for special services, yield differential adjustments, and, in some cases, either a share or all of any applicable prepayment premiums that Fannie Mae permits under the terms of a negotiated contract. The cost of servicing must be borne by the servicer unless the Selling Guide and Servicing Guide expressly provide otherwise.
Some servicers have chosen to use technology provided by outsourcing companies or third-party vendors to assist in carrying out their servicing responsibilities. The technology is used to, among other things:
- refer foreclosure and bankruptcy matters to attorneys and trustees,
- exchange documents and information with attorneys and trustees,
- monitor the progress of foreclosure and bankruptcy matters, and
- facilitate the submission and payment of invoices from the attorneys and trustees for fees and expenses incurred as part of the default process.
In addition, under certain arrangements, attorneys and trustees are required to input information directly into the servicer’s systems and may be charged fees for data entry or access to those systems. Fannie Mae has required that the fees charged to any attorney or trustee for technology usage or electronic invoice submission in connection with a Fannie Mae loan be reasonable in relation to the benefit received by the attorney or trustee.
In Announcement SVC-2010-10, Miscellaneous Servicing Policy Changes, Fannie Mae:
- defined “reasonable” fees that could be charged to and paid by attorneys and trustees;
- provided that any fees for technology usage or electronic invoice submission in excess of the limitations imposed would be the
- responsibility of the servicer, could not be charged to or paid by the attorneys and trustees, and would not be reimbursed by Fannie Mae; and
- provided that the fees could not to be charged as a cost to the borrower.
To view the Announcement in its entirety, please click here.
About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees and a handful of contractors performing services in the Midwest, to a national company with over 800 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.