Master Servicing Simplification Changes
Fannie Mae is making policy and operational changes to Master Servicing processes and systems. These tools are designed to help you prepare and seamlessly implement these required changes.
Upcoming Loan Management Changes
June 18, 2025 – We are providing advance notice of transformational changes to streamline servicing, enhance risk management, and improve efficiencies for our mortgage servicing partners. These changes will be delivered in a multi-year, phased approach and pertain to:
- Event-based reporting
- Loan data expansion
- Principal and interest (P&I) remittance for summary reporting Actual/Actual (A/A) mortgage loans
Start preparing now:
- Review the resources below to get started (Lender Letter, data requirements and FAQs)
- In consultation with your technology partner (if applicable), analyze how these future changes will affect your current systems and processes by:
- Mapping current data to the future reporting requirements to understand what you will be required to report in the future.
- Identifying gaps between the required data and what you are currently reporting.
- Planning for how you will source the new data.
Contact
If you have questions about these change, contact Future of Servicing.
Completed
Cash Simplification Changes
We updated LL-2023-05, Advance Notice of Changes to Master Servicing Processes and Systems, to reflect that changes to reporting deadlines for summary loan payments are effective with the September 2024 loan reporting cycle.
Guaranty fee relief after four months delinquency
Per LL 2021-12, for Scheduled/Scheduled remittance type mortgage loans where we bear the foreclosure loss risk, in the Loan Reporting Cycle that an Scheduled/Scheduled MBS mortgage loan becomes 120 or more days delinquent, Fannie Mae will place the mortgage loan in the Stop Delinquency Advance process.
Elimination of advance payment of UPB at foreclosure
Per Lender Letter LL-2021-12, effective Sept. 2021, the requirement for servicers to advance payment of outstanding scheduled UPB upon completion of the foreclosure for all Scheduled/Scheduled remittance type mortgage loans for which Fannie Mae bears the foreclosure loss risk, or which are shared risk with us being responsible for marketing the property has been eliminated.
Reimbursement of gross servicing fee and guaranty fee for mortgage loans with a payment deferral
Per Lender Letter LL-2021-12, effective Sept. 2021, servicers will be able to obtain advance notice of the reimbursable amounts by utilizing Fannie Mae Connect™ or the Loan Servicing Data Utility (LSDU) application.
24 Month Delinquent Loan Reclassification
Per Lender Letter LL-2020-13, effective Jan. 2021, Fannie Mae changed the trigger for automatic reclassification from four consecutive months delinquent to 24 consecutive months delinquent (measured by LPI date). These changes became effective for mortgage loans that become greater than four consecutive months delinquent on or after Feb. 2021 remittance activity (based on Jan. 2021 reporting activity).
P&I Advance Changes
Per Lender Letter LL-2020-08, effective Aug. 2020, Fannie Mae discontinued servicer advances of scheduled remittances of principal and interest (P&I) payments for delinquent Scheduled/Scheduled remittance type mortgage loans (delinquency advances) after four consecutive missed monthly payments for mortgage loans serviced under the special servicing option.
2020 Cash Simplification Changes
Per Lender Letter LL-2019-07, effective Aug. 2020, Fannie Mae made policy and operational changes to simplify and streamline the Fannie Mae cash remittance and reconciliation processes. These changes reduced touch points and eliminated manual operations for remitting Principal and Interest (P&I) for Scheduled/Scheduled and Scheduled/Actual portfolio loans.
