Servicing Guide

Published September 9, 2020

For best results, pose your search like a question.

Guide Resources

For a comprehensive list of resources such as forms, announcements, lender letters, notices and more.

Visit Selling and Servicing Guide Communications and Forms

Customers Recommend Ask Poli

AskPoli

If you have additional questions, Fannie Mae customers can visit Ask Poli to get information from other Fannie Mae published sources.

Launch Ask Poli  

Download PDF Guide

You can also download the printable ~800 page PDF, which include links.

Download Now

How should scheduled UPB be calculated for daily simple interest loans for investor reporting purposes?

Interest accrues daily (based upon a 365-day year) up to but not including the date a payment is received that reduces principal. Then, starting on the date the principal was reduced, interest accrues on the new balance. The following example provides an illustration of the calculation the servicer must complete. 
 
 Example:

  • Balance as of March 5 (and assuming interest is fully satisfied to this date): $10,000.00
  • Payment of $500.00 received on March 24 (effective date = March 24 with interest accrued through March 23)
  • Interest rate = 5.5% Fannie Mae's system will calculate interest on $10,000.00 for 19 days (March 5 to March 24) @ 5.5%. 10,000.00 x 0.055/365 x 19 = 28.63 $28.63 would be applied to interest and $471.37 would go to principal, bringing the new UPB to $9,528.63.  Starting on March 24, Fannie Mae's system would calculate interest on the new UPB, $9,528.63. 

 When a payment is made by the borrower, the servicer must satisfy accrued interest first, then principal with the payment effective, driving the interest calculation.

 

For more information see Investor Reporting Manual Chapter 2-04, Reporting Specific Payment Transactions to Fannie Mae (02/14/2018)

Have You Tried Ask Poli?

Poli knows. Just ask.

Ask Poli features exclusive Q&As and
more—plus official Selling & Servicing
Guide
content.

Try Ask Poli

Related Articles


AskPoli

Customers Recommend Ask Poli

If you have additional questions, Fannie Mae customers can visit Ask Poli to get information from other Fannie Mae published sources.

Guide Resources

For a comprehensive list of resources such as access forms, announcements, lender letters, notices and more.

Visit Selling and Servicing Guide Communications and Forms

X
Having Issues with Seeing this Page Correctly?

Use Firefox or Chrome   How to do a hard refresh in Internet Explorer
We recommend that you use the latest version of FireFox or Chrome.

Download Firefox
Download Chrome
  A hard refresh will clear the browsers cache for a specific page and force the most recent version of a page.
    Hold the Ctrl key and press the F5 key.
     

Email Us
If you still have Technical Support questions, feel free to emailAsk_Poli@fanniemae.com.