When a mortgage loan is paid in full, the servicer is responsible for collecting any advances made on behalf of the borrower along with the mortgage loan payoff, in accordance with C-1.2-03, Processing Payments in Full. The following table describes the servicer’s responsibilities related to collecting advances.
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Collect any funds advanced on behalf of the borrower.
Remit the repayment as a special remittance to Fannie Mae, and within 30 days of the payoff date, if Fannie Mae advanced the funds.
Note: The repayment of advances must not be included as part of the payoff proceeds.
For more information please see Servicing Guide F-1-09, Processing Mortgage Loan Payments and Payoffs.