Servicing Guide

Published September 9, 2020

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What is the process for requesting reimbursement for advances made under a military indulgence?

The servicer may request reimbursement for advances made under a military indulgence in accordance with the Servicing Guide. The process for requesting reimbursement for advances made under a military indulgence varies according to whether the mortgage loan is a portfolio mortgage loan or an MBS mortgage loan, as shown in the following table.

If the mortgage loan is… Then...

a portfolio mortgage loan

Fannie Mae will adjust its investor reporting system records to reflect the 6% interest rate and new P&I payments (calculated in accordance with either the standard method or the interest subsidy method) upon receipt of Form 1022. The servicer will not have to advance any interest and no request for reimbursement is necessary.

 

Note: If the interest subsidy amortization method is used, the servicer must notify Fannie Mae by submitting Form 1022 to sailors_and_soldiers@fanniemae.com to notify Fannie Mae of any change in the monthly installment while the mortgage loan is under military indulgence.

 

a PFP mortgage loan

  • regardless of remittance type, Fannie Mae will not adjust its investor reporting system records.

  • the servicer must submit Form 1022 to sailors_and_soldiers@fanniemae.com by the ninth business day in order to request an adjustment be made to the servicer’s shortage surplus account for the current month.

     

    Note: Requests received after the ninth business day will be processed the following month.

     

an MBS mortgage loan

  • regardless of remittance type, Fannie Mae will not adjust its investor reporting system records;

  • the servicer must submit the mortgage loan information through Fannie Mae’s investor reporting system under the Loan Reporting screen through the SCRAMS file transmit link; and

  • once the mortgage loan has been submitted through Fannie Mae’s investor reporting system, the servicer must only resubmit if

    • corrections are needed,

    • there is an early release, or

    • service has been extended.

Fannie Mae will continue to make disbursements for the amount of the interest rate reduction through the military indulgence end date plus one year. The disbursements will be funded two days prior to the end of the month in the custodial account that the servicer has assigned for military indulgence funds. Once a mortgage loan is reclassified from the MBS pool, the servicer must submit Form 1022 to have the rates updated effective the month after the reclassification.

For additional information, please see F-1-20: Processing Military Indulgence.

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