Novation Mortgage :: Recent Fannie Mae Updates

Thu - 7/29/2010

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Recent Fannie Mae Changes and Notices

Fannie Mae Single Family
Announcements and Letters
2007 Announcements and Letters
Ann. 07-03: Introduction of the Fannie Mae Single-Family MBS Master Trust Agreement (Announcement 06-27) (03/01/07)

Due-on-Transfer Clauses

Servicing Guide Part I: Lender Relationships; Chapter 2, Contractual Relationship; Section 208.04, Servicer's Optional Repurchase of Certain MBS Pool Mortgages; and Part III: General Servicing Functions; Chapter 4, Transfers of Ownership.

Servicers are reminded that they must enforce the due-on-transfer clause when the mortgage documents include a due-on-transfer clause and the servicer has knowledge that a mortgaged property has been or is about to be conveyed by the borrower in violation thereof, and none of the permitted transfer or other exceptions contained in the Servicing Guide applies. An example of a due-on-transfer violation is when a borrower sells or transfers a property to an unrelated third party without prior approval of the servicer.

REMINDER TO OUR CLIENTS

There is no type of trust or partnership that can help you "get around" the Due On (Transfer) Sale Clause including the Illinois Type Land Trust unless the beneficiaries of the trust are the owners of record indicated on the mortgage deed. I don't care how much you paid for the seminar, book or DVD set the cold hard fact is if you accept transfer of a property or transfer a property to another entity in this manner you are at risk of an immediate demand of satisfaction or forfeiture of the property.

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