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E-2.3-05, Bankruptcies Involving Multiple Fannie Mae Mortgage Loans (11/12/2014)

Before referring a case to a law firm, the servicer must make a reasonable effort to determine whether the borrower has any other outstanding mortgage debts on other real property included in the bankruptcy estate. One way of doing this is to order a credit report for the borrower to see if any other mortgage debts appear on the report. If such debts exist, the servicer must try to identify the servicers of the other mortgage loans and initiate contact with them to determine whether Fannie Mae also has an interest in those mortgage loans.

In any instance in which Fannie Mae has an interest in more than one mortgage loan for which the security property is part of the same borrower’s bankruptcy estate, the servicer must abide by the instructions presented in the following table.

The servicer must…

Coordinate its efforts with those of the other servicers and/or the law firms to which the other servicers have referred the mortgage loans.


Have the same law firm handle the proceedings for all of the mortgage loans, whenever possible. If not possible, the servicers must emphasize to the individual law firms to which they have referred the mortgage loans the need to work closely with the other law firm(s) involved to ensure that Fannie Mae’s interests are adequately protected.

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