Servicing Guide

Published September 9, 2020

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What are the requirements for remitting third party sales proceeds to Fannie Mae?

The servicer must remit all third-party sales proceeds to Fannie Mae regardless of whether or not the sale is finalized or falls through in accordance with E-3.5-02, Handling Third-Party Sales. 

If the sale is finalized, the amount that must be remitted to Fannie Mae is the lesser of: 

  • the reserve price; or
  • the total mortgage indebtedness, including the UPB of the mortgage loan and interest (based on the applicable PTR) for the period from the due date of the LPI to the latter of the liquidation or settlement date. 

However, if state law requires that the sheriff deduct fees from the sale proceeds, the servicer must remit the proceeds less such deductions to Fannie Mae along with an itemization of the deducted fees. 

The servicer must submit arequest for expense reimbursement for any reimbursable expenses. 

The servicer must not submit any sales proceeds that remain after Fannie Mae has been paid the amount it is due—and after the servicer has been reimbursed for its expenses and advances—because these proceeds must be distributed as provided for under local statutory requirements. 

Any premium refunds (minus the portion that may be required to reimburse Fannie Mae or the servicer for advances Fannie Mae made) must be disbursed as shown in the following table. 

If the mortgage loan is... Then the payment must be made to the...

FHA

third-party purchaser

Conventional, VA, or RD

borrower

For a VA mortgage loan, the servicer must file a claim under the guaranty if the third party’s bid was more than VA’s “upset price,” but less than the total indebtedness. The servicer also may file a claim under FHA’s claim without conveyance procedure for an FHA mortgage loan that was endorsed for insurance on or after November 30, 1983. For additional information, see Section E–4.5, Filing MI Claims for Liquidated Properties. 

For more information please see Servicing Guide F-1-21, Remitting and Accounting to Fannie Mae

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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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