D2-3.2-02, Repayment Plan (08/13/2025)

The servicer is authorized to evaluate the borrower for a repayment plan without receiving a complete BRP. However, if the borrower submitted a complete BRP, the servicer must evaluate the borrower in accordance with Fannie Mae’s evaluation requirements as indicated in D2-2-05, Receiving a Borrower Response PackageD2-2-05, Receiving a Borrower Response Package.

The following requirements apply to repayment plans:

• The servicer must consider a repayment plan when the delinquency resulted from a temporary hardship that no longer appears to be a problem.

• For an MBS mortgage loan, the servicer must identify and distinguish the pool issue date and be familiar with the reclassification requirements (see A1-3-06, Automatic Reclassification of MBS Mortgage LoansA1-3-06, Automatic Reclassification of MBS Mortgage Loans for additional information).

• The repayment plan terms must be provided to the borrower with an Evaluation Notice. For additional information on the requirements for an Evaluation Notice, see Sending a Notice of Decision on a Workout Option in D2-2-05, Receiving a Borrower Response PackageD2-2-05, Receiving a Borrower Response Package.

• When the servicer initially offers an arrangement that includes a combination of both forbearance and a repayment plan, the combined period must not exceed 36 months.

The following table provides the requirements for a repayment plan based on the mortgage loan's delinquency status at the time of evaluation and the duration of the repayment plan.

Note: The borrower may make a payment that is sufficient to bring the arrearage within eligible parameters.

If the borrower does not make their total monthly repayment plan payment by the end of the month in which it is due and the servicer is unable to achieve QRPC, then the servicer must evaluate the borrower for a payment deferral and, if eligible, solicit the borrower for a payment deferral in accordance with D2-3.2-04, Payment DeferralD2-3.2-04, Payment Deferral.

If the borrower is ineligible for a payment deferral, then the servicer must evaluate the borrower for a Fannie Mae Flex Modification and, if eligible, solicit the borrower for a Fannie Mae Flex Modification in accordance with  D2-3.2-06, Fannie Mae Flex ModificationD2-3.2-06, Fannie Mae Flex Modification.

If a borrower with a disaster-related hardship does not make their total monthly repayment plan payment by the end of the month in which it is due and the servicer is unable to achieve QRPC, then the servicer must evaluate the borrower for a disaster payment deferral and, if eligible, solicit the borrower for a disaster payment deferral in accordance with   D2-3.2-05, Disaster Payment DeferralD2-3.2-05, Disaster Payment Deferral.

If the borrower is ineligible for a disaster payment deferral, then the servicer must evaluate the borrower for a Fannie Mae Flex Modification and, if eligible, solicit the borrower for a Fannie Mae Flex Modification in accordance with Evaluating or Soliciting a Borrower with a Disaster-Related Hardship for a Fannie Mae Flex Modification in  D2-3.2-06, Fannie Mae Flex ModificationD2-3.2-06, Fannie Mae Flex Modification.

The repayment plan may include accrued late charges due when the plan is established between the servicer and the borrower. The servicer must waive late charges accrued during the repayment plan period as long as the terms of the repayment plan are maintained by the borrower.

The servicer must not apply buydown funds to reduce any delinquent amounts in connection with a repayment plan unless required by the terms of the buydown agreement.

Note:  If the buydown terms ends during the repayment plan period, the servicer must determine the borrower's remaining total monthly repayment plan payment amount based on the borrower's full contractual monthly payment per the mortgage note.

The Evaluation Notice must comply with the requirements as specified in the F-1-16, Processing a Repayment PlanF-1-16, Processing a Repayment Plan.  The servicer must make the appropriate changes to the Evaluation Notice and must comply with the requirements as specified in F-1-16, Processing a Repayment PlanF-1-16, Processing a Repayment Plan.  The servicer must make the appropriate changes to the Evaluation Notice as necessary to disclose the terms of the repayment plan, including monthly payment amounts and any scheduled changes to the borrower's monthly payment as specified in the buydown agreement or resulting from the completion of the buydown term.

Once the buydown term ends, the servicer must return any funds it has held in association with a temporary interest rate buydown plan to Fannie Mae in accordance with C-3-01, Responsibilities Related to Remitting P&I Funds to Fannie MaeC-3-01, Responsibilities Related to Remitting P&I Funds to Fannie Mae, subject to the terms of the buydown agreement.

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