Servicing Management Default Underwriter™ (SMDU™) is Fannie Mae’s groundbreaking decisioning tool used by servicers that delivers real-time borrower eServicing Management Default Underwriter™ (SMDU™) is Fannie Mae’s groundbreaking decisioning tool used by servicers that delivers real-time borrower evaluations for a variety of our retention and liquidation workouts and delivers certainty, speed, and savings in loss mitigation.valuations for a variety of our retention and liquidation workouts and delivers certainty, speed, and savings in loss mitigation.
SMDU evaluates loss mitigation workouts for conventional loans where the borrower may be experiencing a hardship that causes (or may in the future cause) a payment delinquency. When a servicer provides borrower’s data to Fannie Mae for an SMDU evaluation and then SMDU provides an evaluation response back to the servicer it’s known as the Auto-Decisioning (AD) side of SMDU. SMDU also has Case Management (CM) functionality allowing servicers to report statuses of active loss mitigation workouts to Fannie Mae in lieu of utilizing Fannie Mae’s HomeSaver Solutions® Network (HSSN).
For more information, visit the SMDU page on fanniemae.com.
The SMDU User Interface (UI) is Fannie Mae’s web-based application that enables a servicer to access SMDU to:
- Submit a loan for evaluation for retention (trial and final modification evaluations) and/or liquidation options.
- Report case statuses and upload case documents directly to Fannie Mae, eliminating the need to use HSSN to create, update, and/or close a case.
- Send an SMDU decisioned loan to Fannie Mae’s Home Retention Solutions Group for manual review (Fannie Mae Flex Modification with a completed Borrower’s Response Package (BRP) only).
- Ensures compliance with Fannie Mae workout evaluation policies through accurate and consistent workout decisioning.
- Offers servicers limited liability relief when using SMDU decisions.
- Reduces costs and resources required to update, implement, and maintain Fannie Mae loss mitigation programs.
- Automates time consuming and high-touch loss mitigation evaluation and case management activities.
- Delivers real-time decisioning to enable timely responses and faster workout fulfillment.
- Ensures servicers can provide homeowners fast, accurate, and consistent decisions.
Waivers of representations and warranties, if any, are set forth in Fannie Mae’s Software Subscription Agreement. Servicers may rely upon the loss mitigation recommendation and findings messages contained in the SMDU™ response to assist with loss mitigation activities for Fannie Mae loans. Limited waiver of representations and warranties will continue to apply for servicers who provide accurate input data and follow the guidance provided in the SMDU finding messages.
Before utilizing the Fannie Mae SMDU UI, you should ensure that your browser includes one of the following:
- Internet Explorer (IE) version 11 (IE11)
- FireFox version 45.1.1
- Google Chrome version 53.0.2785.143m or higher
- Safari 10
Log into SMDU UI at: https://servicing.fanniemae.com/smdu/
- SMDU UI users will sign on using their single sign on username and password.
Each icon represents a respective action you can take.
Evaluate for a Workout: Allows servicer to complete the required dataset to submit a loan to SMDU for a Structuring TRIAL evaluation.
Create Manual Submission: Allows servicer to report a delegated or submit a non-delegated case to Fannie Mae for a loan that was not evaluated by SMDU.
Record Trial Payments: Allows servicer to report trial payments and, if applicable, extend the trial period plan.
Evaluate for Final: Allows servicer to update the required dataset to submit a loan decisioned by SMDU at trial to SMDU for Structuring FINAL evaluation. This is known as a “dependent final” because the SMDU Structuring FINAL evaluation is dependent on their being an SMDU trial evaluation.
Evaluate for First-Time Final: Allows servicer to complete the required dataset to submit a loan that was not evaluated by SMDU at trial for an SMDU Structuring FINAL evaluation.
Close Case: Allows servicer to update a reported trial with the final modification terms to close out the case in Fannie Mae’s Servicing Solution System.
Report Case: Allows a servicer to report a payment deferral or COVID-19 payment deferral case to Fannie Mae.
Request Second Look: Servicer can submit a loan that was previously evaluated by SMDU at TRIAL to Fannie Mae’s Home Retention Solutions (HRS) group for a “Second Look” review. HRS will review the loan and provide an email outlining whether the request was “Approved for Trial” or “Declined”. If “Approved for Trial” the email will have the applicable trial terms and such terms will also be available in the SMDU UI, if “Declined” the email will provide the reason for declination.
Note: SMDU CANNOT review loans for Structuring FINAL evaluations that were “Approved for Trial” through the Request Second Look functionality, you must complete the final structuring review outside of SMDU and report the final terms to Fannie Mae when closing the case.
Evaluation History: This provides an overview of the loan’s SMDU evaluation history. You can also view and activate a previous SMDU evaluation, print the evaluation terms, request an Appeal or view the SMDU response XML.
Create Mortgage Release™: Allows servicer to create either an SMDU or non-SMDU borrower evaluated Mortgage Release case in Fannie Mae’s Servicing Solution System. Currently Mortgage Release cases can be submitted through SMDU as either delegated or non-delegated.
Other Actions – Cancel Case: Allows servicer to cancel an existing case that has been reported to Fannie Mae.
Other Actions – Evaluate for Imminent Default: Allows servicer to submit a dataset for a loan that is not being evaluated by SMDU for imminent default. If SMDU is evaluating a loan at trial through the Evaluate for Workout functionality then the loan will also be reviewed for imminent default, thus there is no need to process the loan through this Evaluate for Imminent Default standalone functionality.
- Other Actions – Create Charge Off: Allows servicer to complete the required dataset to report a charge off to Fannie Mae’s Servicing Solution System for review by Fannie Mae.
- Other Actions – Create Second Lien Consideration: Allows servicer to complete the required dataset to submit a second-lien mortgage loan to Fannie Mae’s Servicing Solution System for review by Fannie Mae.
- Other Actions – Upload Case Document: Allows servicer to upload a case document(s) after a case has been created and remains in an active status.
SMDU is broken down into two distinct functionalities: Auto-Decisioning (AD) and Case Management (CM)
- The AD side of SMDU allows the servicer to provide loan details and submit loan to SMDU for evaluation, then SMDU evaluates the loan through the applicable waterfall hierarchy and provides a detailed response for both eligible and ineligible workout types. The following AD functionalities are available in the SMDU UI:
- Evaluate for a Workout (Structuring Trial Request): If eligible, SMDU will return the trial plan terms and approval conditions. These terms should be offered to the borrower, if the borrower accepts the workout by making their first trial payment then you move to the CM side of SMDU. If the borrower never makes the first trial payment then you have nothing to cancel in SMDU, since you never entered the CM side of SMDU.
- Appeal: Complete re-evaluation based on updated loan data derived during servicer’s independent evaluation of borrower’s appeal of a modification denial. If the appeal results in an eligible modification, SMDU will return the trial plan terms and approval conditions. These terms should be offered to the borrower, if the borrower accepts the workout by making their first trial payment then you move to the CM side of SMDU. If the borrower never makes the first trial payment then you have nothing to cancel in SMDU, since you never entered the CM side of SMDU.
- Evaluate for Final (Structuring Final Request for Dependent Trial): Complete evaluation for permanent modification of a single required modification, based on existing SMDU trial plan terms. Prior to SMDU evaluating the loan for final terms, servicer will have the opportunity to update loan details provided during the trial evaluation, plus complete additional data fields covering the actual trial plan. If eligible, these terms should be entered into the modification agreement and submitted to the borrower for final execution. If the borrower returns the mortification agreement then you move to the Close Case step of CM. If the borrower fails to return the modification agreement then you move the Cancel Case step of CM.
- Evaluate for First-Time Final (Structuring Final for a loan not decisioned by SMDU at trial): Complete evaluation for permanent modification of a single required modification, based on existing non-SMDU trial plan terms. Prior to SMDU evaluating the loan for final terms the servicer must provide basic loan details, including details about the actual trial plan. If eligible, these terms should be entered into the modification agreement and submitted to the borrower for final execution. If the borrower returns the modification agreement then you move to the Close Case step of CM. If the borrower fails to return the modification agreement then you move the Cancel Case step of CM.
- The CM side of SMDU starts when the servicer: (1) reports the first trial payment to Fannie Mae for an SMDU decisioned loan (Record Trial Payments); (2) Request Second Look for an SMDU evaluated loan; (3) selects Create Manual Submission for a loan evaluated and decisioned outside of SMDU (delegated or non-delegated); (4) servicer has created a liquidation case; (5) servicer creates a charge off case request (Create Charge Off); or (6) servicer creates a second lien consideration request (Create Second Lien Consideration). CM for retention requires that all cases are: (1) closed after all trial payments have been reported and the final modification documents have been returned; (2) cancelled after the first trial payment has been reported and the borrower fails to makes subsequent trial payment(s) or fails to return the final modification agreement (aka Failed Trial); (3) cancelled if submitted as a non-delegated case (not decisioned by SMDU) and the borrower never makes the first trial payment; or (4) cancelled if the case needs to be resubmitted. Additional CM functionality details are as follows:
- Servicer MUST use the Record Trial Payments icon to update and/or report subsequent trial payments to Fannie Mae, and if applicable Extend Trial Period Plan.
- For completed cases servicer MUST use the Close Case icon to update and report the final modification terms to Fannie Mae.
- If the first trial payment is recorded and the borrower fails to make subsequent trial payments or return the final modification agreement then the servicer MUST Cancel Case and reported as a failed trial.
- If the case is manually “Approved for Trial” by Fannie Mae and the borrower fails to make the first trial payment then the servicer MUST Cancel Case and reported as a non-responsive borrower (this is not a true failed trial).
- If servicer needs to resubmit an active case, because for example the case at closing went to an “Approved” status versus “Closed” possibly due to invalid data input, then the servicer MUST cancel and resubmit case (Resubmitting a Cancelled Case).