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A4-2.2-01: Selecting and Retaining Law Firms (02/09/2022)


This topic contains the following:



The servicer is responsible for selecting qualified, experienced law firms for all jurisdictions to handle default-related legal services relating to Fannie Mae mortgage loans. Default related legal services include foreclosure, workout options, bankruptcy and related litigation.

See  F-2-04, Firm Minimum Requirements  and Compliance with the HERA in Selling Guide A3-2-01, Compliance with Laws for additional information regarding requirements for law firm selection. For a Mortgage Release, a servicer is authorized to select a third-party other than a law firm to prepare documentation; however, the servicer must select qualified and experienced vendors to complete the services related to this activity.

In order to mitigate risk arising from the concentration of legal work relating to Fannie Mae mortgage loans, the servicer must select and retain an appropriate number of law firms for each jurisdiction.

Fannie Mae does not allow for the direct referrals of Fannie Mae mortgage loans to trustees for foreclosure in any jurisdiction.

Fannie Mae retains counsel directly for legal services relating to acquired properties.


Managing Legacy Matters

Matters that were referred to law firms that were part of Fannie Mae's retained attorney network under the previous structure will be considered ”Legacy Matters,” and will be governed by the pre-existing engagement letters between those law firms and Fannie Mae. The following table provides additional guidance to servicers handling Legacy Matters.

If the servicer… Then the servicer…

elects to leave Legacy Matters at a law firm that it does not select and retain pursuant to current policy

  • is responsible for managing and overseeing the law firm's performance and compliance in accordance with the requirements of Fannie Mae's current default-related legal services structure.

decides to transfer Legacy Matters to law firms selected and retained pursuant to current policy

  • must do so at its own expense,

  • must provide Fannie Mae’ Legal department with five business days' prior written notice via email (see F-4-02, List of Contacts), and

  • will be responsible for any errors, omissions, or delays by the transferee law firm.


Performing Due Diligence When Selecting and Retaining Law Firms

The following table lists the servicer's duties related to law firm selection.

The servicer must…

Collect data from the law firm.


Conduct appropriate due diligence to evaluate whether the law firm meets Fannie Mae's minimum requirements as described in F-2-04, Firm Minimum Requirements.


Maintain documentation evidencing its law firm selection process, including how law firms are

  • solicited,

  • evaluated, and

  • selected.

If the servicer concludes that a law firm does not meet Fannie Mae’s minimum requirements, or as a result of the due diligence process decides not to retain the law firm, the servicer must inform the law firm that it has not been selected. Information relating to law firms that are not selected and retained by the servicer must be maintained for the longer of any retention period applicable to the servicer, or seven years.

The servicer is not obligated to inform Fannie Mae if the servicer

  • determines that a law firm does not meet the minimum requirements, or

  • decides not to retain a law firm.


Submitting a Servicer Selection Form

The servicer must submit a Servicer Selection Form (Form 200) to Fannie Mae for each law firm it wishes to retain to provide default-related legal services for Fannie Mae mortgage loans. By submitting Form 200, the servicer certifies the law firm’s satisfaction of Fannie Mae’s minimum requirements and other certain required disclosures. 

The following table provides Fannie Mae’s requirements related to the submission of Form 200.

The servicer must…

Submit a Form 200 for each jurisdiction for which the servicer wishes to retain a law firm, if the law firm practices in multiple jurisdictions.


Retain all information submitted by a law firm in support of the law firm’s application or otherwise gathered by the servicer regarding the law firm.

Note: Information relating to law firms that are selected and retained by the servicer must be maintained as long as the law firm is providing legal services with respect to Fannie Mae mortgage loans and, thereafter, for the longer of any retention period applicable to the servicer, or seven years.


Make all information available to Fannie Mae upon request.

Within 15 business days following the submission of Form 200, Fannie Mae expects that it will be in a position to issue a "No Objection" determination, an "Objection" determination, or request additional information for each Form 200 submitted.

The following table provides the servicer with further instructions based on Fannie Mae's response to Form 200.

If Fannie Mae… Then the servicer must…

issues an ”Objection” determination

not retain the law firm to handle Fannie Mae matters and inform the law firm that it was not selected.

issues a ”No Objection” determination

inform the law firm that it must attend Fannie Mae new law firm training and sign a limited retention agreement with Fannie Mae in order to become eligible to receive referrals of Fannie Mae mortgage loans.

requests additional information

provide the requested information as quickly as possible.

The servicer cannot rely upon the fact that another servicer previously submitted Form 200 with respect to a law firm and received a ”No Objection” determination.


Law Firm Training and the Limited Retention Agreement

All law firms that receive a "No Objection" determination from Fannie Mae must complete Fannie Mae new law firm training. Law firms only have to attend this training once, regardless of the number of servicers that select and retain the law firm.

Law firms must also execute a limited retention agreement. The limited retention agreement will recognize and reflect a joint attorney-client relationship between the law firm, Fannie Mae and the servicer. It will also provide that it controls in the event that there are any inconsistent provisions in any agreement between the law firm and the servicer. The servicer may access the form of the limited retention agreement by logging in to the password-protected portion of Fannie Mae’s website. Fannie Mae considers the form of the limited retention agreements to be confidential and proprietary information, and the servicer must treat the forms consistent with this classification.


The Use of Special Counsel

From time to time, servicers retain counsel at their own expense to represent Fannie Mae and/or the servicer pursuant to their indemnification obligations to Fannie Mae (Special Counsel). Special Counsel retained and paid by servicers pursuant to their indemnification obligations to Fannie Mae do not have to be selected and retained pursuant to the guidelines described in  A4-2.2-01, Selecting and Retaining Law Firms. The following table describes the requirements of the servicer if it retains Special Counsel.

The servicer must…

Notify Fannie Mae of the retention of Special Counsel.


Ensure that its Special Counsel keeps Fannie Mae updated on the progress of the matters handled by the law firm.


Ensure that it or the Special Counsel periodically updates the law firm to which the foreclosure, bankruptcy, or eviction matter was originally referred regarding the status of the matter for which the Special Counsel was retained.

Once any issues for which Special Counsel was retained are resolved, the servicer must transition the foreclosure, bankruptcy, or eviction matter back to the law firm to which it was originally referred for any required further proceedings.

See Selling Guide A2-1-03, Indemnification for Losses for additional information.


Recent Related Announcements

The table below provides references to recently issued Announcements that are related to this topic.

Announcements Issue Date
Announcement SVC-2 022-01 February 9, 2022

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