Servicing Guide

Published November 10, 2020

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How should a servicer process a transfer of ownership for an assumption of a delinquent loan?

The servicer must process any transfer of ownership in accordance with Chapter D1-4, Transfers of Ownership.   

An Assumption of a Delinquent Mortgage Loan

The servicer must process the transfer of ownership as described in the following table.

If... Then the servicer must...

Fannie Mae is the mortgagee of record and the servicer does not have an assignment of mortgage

  • prepare the assignment of mortgage, and

  • send the assignment of mortgage to Fannie Mae’s SF CPM division (see F-4-03, List of Contacts) for execution.

    Note: Once Fannie Mae returns the executed assignment of mortgage to the servicer, the servicer is authorized to execute the assumption agreement and must send the original recorded assumption agreement to its document custodian.

the servicer (or MERS) is the mortgagee of record, or if Fannie Mae is the mortgagee of record and the servicer has an assignment of mortgage

  • execute the assumption, or assumption and release, agreement;

  • have the executed agreement recorded, if required;

  • send the recorded agreement to its document custodian.

Regardless of the owner of record for the mortgage loan, the servicer must have the executed transfer documents recorded and should request a title bring-down from the title insurer. The bring-down must

  • change the effective date of the mortgage title policy to the date the transfer instruments were recorded, and

  • insure the mortgage loan as modified by the recorded agreement.

The servicer must provide the document custodian with the assumption agreement.

For more information please see F-1-18, Processing a Transfer of Ownership.

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If you have additional questions, Fannie Mae customers can visit Ask Poli to get information from other Fannie Mae published sources.

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