Section 15: Change in Occupancy / Loan Status
Property inspections must continue as long as the loan remains 45+ days delinquent, regardless of occupancy status. An exception to this rule is when the servicer achieves Quality Right Party Contact (QRPC) and the property is borrower occupied. When a servicer determines a property occupied after maintenance has begun, the servicer must cease property preservation activities until servicer determines a property is vacant again.
See Servicing Guide D2-2-10: Requirements for Performing Property Inspections for further guidance on delinquent loan property inspection requirements.
The servicer must cease inspection and property preservation activities following a foreclosure sale, completed Mortgage Release (deed-in-lieu of foreclosure), or when the loan is paid in full unless otherwise instructed by Fannie Mae, even if title transfer to Fannie Mae has not completed (such as during an applicable redemption period or when the court has not yet confirmed or ratified the sale).
See Servicing Guide E-4.3-01: Managing the Property Post-Foreclosure Sale and E-4.3-02: Inspecting Properties Post-Foreclosure Sale for further guidance.
When a property liquidates via Third-Party Sale (TPS), the servicer must continue performing necessary activities (i.e., inspections, property preservation, etc.) to protect Fannie Mae’s interest in the property until the latter of either the date the foreclosure sale is completed (including receipt of funds), or the date the court confirms or ratifies the sale, when applicable.
See Servicing Guide E-3.5-02: Handling Third-Party Sales for further guidance.