Servicing Guide

Published June 10, 2020

The Servicing Guide is organized into parts that reflect how lenders generally categorize various aspects of their business relationship with Fannie Mae. To begin browsing, select from any of the sections below. You may also download the entire Servicing Guide in PDF format.

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What are the servicing responsibilities related to foreclosure title costs?

Foreclosure-related title costs must be kept at a minimum and in compliance with Fannie Mae maximum allowable title costs. The maximum allowable title cost is the amount that Fannie Mae will reimburse the servicer for title costs incurred by the law firm retained by the servicer to handle Fannie Mae foreclosure matters.

The following table provides the servicer with additional information regarding the requirements of a title search and related updates.

Title Search and Update Requirements
 

The maximum allowable foreclosure-related title cost includes:

  • an initial two-owner title search dating back to the deed prior to the mortgagor’s deed,

  • up to three title updates to the initial title search that are required and necessary to complete the foreclosure sale, and

  • complete copies of all documents and a summary page.

 

Unless specified by Fannie Mae, the initial title search must be an uninsured title search without additional charges for insurance or guarantees.

 

The title search and any required updates must confirm title to the property and identify all recorded liens and documents affecting title and all parties that must receive notice of the foreclosure sale.

Review of the title report is included in the Fannie Mae maximum allowable foreclosure attorney fee and should not be added to the title cost. Fannie Mae will not reimburse the servicer for title searches in excess of a two-owner search or for costs to correct title defects that are covered by selling representations or warranties.

The servicer must reimburse the law firm for foreclosure-related title costs associated with:

  • additional title work the servicer requires the law firm to run for a more detailed title search in excess of two-owner, and

  • fees and costs to correct title defects that are covered by selling representations or warranties.

For more information please see: E-5-07, Other Reimbursable Default-Related Legal Expenses

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