FAQs: Upcoming Loan Management Changes

We are transforming how servicers report activities to and receive data from Fannie Mae through several key improvements: 

1. Event-based reporting: We will streamline how servicers report loan-level transactions. When these changes become effective, you will be required to report loan-level servicing events to us in near real-time, enhancing transparency and ensuring data alignment. Examples of servicing events include contractual payments, curtailments, payment reversals, no payment, rate and payment changes, delinquency status, escrow deposits and disbursements, and mortgage insurance cancellations. As a servicer, you will no longer be required to submit Transaction Type Reports or Loan Activity Records (LARs).
   
   For delinquency reporting, you will be able to submit multiple Loan Delinquency Servicer Action Types, Loan Delinquency Loan Status, and Loan Delinquency Reasons as the activities and events occur (instead of once per month). 
   
   Reporting frequency for event-based reporting: You will be required to report standardized loan-level borrower and servicer activities to Fannie Mae the same day as the events are processed, but no later than 3:00 a.m. ET the next business day. Servicing events will be processed, and results will be made available to view in our servicing solutions system in near real-time. If no payment has been received from the borrower by Calendar Day 22 (CD22) of the reporting period, you will be required to report a “no payment” event. If the 22nd calendar date falls on a weekend or holiday, the servicing event must be reported on the preceding business day. The reporting period will continue to close by 5:00 p.m. ET on Business Day 2 (BD2) of the month. Any activity reported after 5:00 p.m. ET on BD2 will be applied to the next reporting period. 
   
   Note: The event-based reporting and loan data expansion requirements published with Lender Letter LL-2025-02 are specific to investor, escrow, and delinquency reporting. Additional data requirements related to loss mitigation and liquidation reporting are in development and will be published in Q4 2025.
    
2. Expanded loan data: To support the change to event-based reporting, you will be required to report an expanded set of data attributes for servicing events. Reporting an expanded set of data attributes will provide better insight into borrower and servicer activities throughout the loan life cycle and enhance risk management capabilities. These data attributes will align with MISMO (Mortgage Industry Standards Maintenance Organization) data standards for greater consistency and integrity in loan data across the mortgage industry. 
   
   Review the requirements for event-based reporting and the expanded loan data in the Loan Management: Servicing Events and Data Requirements document. 
    
3. Principal and Interest (P&I) remittance for summary reporting Actual/Actual (A/A) mortgage loans: To simplify your responsibilities for remitting P&I payments for A/A remittance type mortgage loans, we will automatically initiate a draft of the P&I remittance amount from your custodial account two business days after successfully processing payment events reported to us. This change will create operational efficiencies, reduce administrative burdens, and eliminate the monthly shortage/surplus balance reconciliation using Schedule 3 – Reconciliation of Shortage Surplus (Form 472). Once the change becomes effective, we will settle any outstanding shortage/surplus balances. There will be no remitting or draft date changes for any other remittance types.

These changes will enhance risk management capabilities and improve the efficiency, accuracy, and overall effectiveness of loan management processes for servicers. The advantages of these changes include: 

• Better/more up-to-date view of loan state: Same day reporting will allow us to process servicing events and provide responses to you in near real-time, enhancing transparency, data alignment, and risk management capabilities as well as eliminating data discrepancies due to timing.
• Simplified delinquency and investor reporting: Eliminating redundant reporting in multiple systems will reduce reconciliations and create operational efficiencies.
• Streamlined cash management: Eliminating bifurcated processes for reporting and remitting on Actual/Actual loans will result in simplification, lower administrative overhead, and eliminate reconciliations due to shortages and surpluses when we initiate draft(s) for P&I due based on the reported payment event(s). This change also aligns our remittance processes (Fannie Mae calculates and drafts P&I) across all our remittance types (Scheduled /Scheduled and Scheduled/Actual).

These transformational changes are part of a multi-year initiative and will be delivered incrementally in a phased approach. The high-level implementation timeline, including customer integration testing (CIT) and Production Go-Live milestones, is available on our web page. Further details will be provided at a later date. Additional requirements, including those related to loss mitigation, liquidation reporting, and data formatting, are currently under development and are scheduled for release in Q4 2025.

We encourage you to review the Lender Letter, Data Requirements, Implementation Milestones, and Technical Specifications documents to: 

• understand the changes and implementation roadmap and key milestones
• analyze how to changes will affect your current systems and processes, with a focus on Escrow Reporting
• map current data to the future reporting requirements, identifying gaps in existing reporting, and begin planning on how you will source new data.
• start preparing for your development activities. 

This document covers the data requirements associated with servicing events that servicers will report and includes definitions, reporting frequency, and the corresponding MISMO and Technical Specification information that can be used for mapping purposes. You and your Technology Service Providers should use the Data Requirement document to assess impacts to existing systems and processes.

The Technical Specifications provide the JSON schema for a defined set of servicing events, along with sample inbound reporting payloads to Fannie Mae. These documents will be updated periodically with:

• JSON schemas and sample payloads for additional servicing events
• Additional technical files, such as response files and sample outbound reporting files from Fannie Mae

We encourage you to visit our web page regularly to stay informed about the latest updates to technical documentation.

The initial set of technical specifications are available on our web page. Other resources will be made available here as details are finalized. We encourage you to visit the web page regularly to stay current on resource updates and begin planning and preparing for timely implementation.

We are committed to providing training and testing opportunities to ensure change readiness.

Events will need to be reported on the same day they are processed, but no later than 3:00 a.m. ET on the next business day. For BD2 (Cycle Close), reporting will be due by 5:00 p.m. ET. We will publish the pre-draft notification no later than the next business day after the event is processed and will initiate the draft of the A/A remittance two business days after the event is processed in our systems. If the A/A draft date falls on a Federal Reserve holiday, it will be drafted the following business day.

See below for an example:

Weekends: 

For servicers that process transactions over the weekend, we will expect the following reporting schedule:  

• If you process transactions on Friday, you must report the event to us no later than by 3:00 a.m. ET on Saturday.
• If you process transactions on Saturday, you must report the event to us no later than by 3:00 a.m. ET on Sunday.
• If you process transactions on Sunday, you must report the event to us no later than by 3:00 a.m. ET on Monday. 

We will publish the pre-draft notification no later than Monday. This will allow you to see the remittance amount and ensure the accounts are funded ahead of the remittance being auto drafted on Tuesday. 

Holidays: 

If there is a Federal Reserve holiday, you will have a business day to review the pre-draft notification; then we will draft on the following business day. For example:

• If Monday is a holiday, you will have Tuesday to review the pre-draft notification ahead of the remittance being auto drafted on Wednesday.
• If Friday is a holiday, you will have Monday to review the pre-draft notification ahead of the remittance being auto drafted on Tuesday.

There will be no remitting changes for S/S and S/A Portfolio Mortgage Loans.

Yes, the No Payment Event is similar to the No Activity LAR reporting. If there is no payment activity on a loan during the reporting period, you must submit a No Payment Event by CD22 of that period. This submission confirms the loan’s unpaid principal balance (UPB) and the last paid installment (LPI) for the time when no payment activity occurred.

In the future state, out of cycle pay-off reversal events will not be accepted.

Currently, servicers report a single cumulative value, "Other Fees Collected Amount," on the Transaction Type 96 (LAR). Expanded detailed reporting in this area will bring greater visibility and insight into loan fees. We will be using this additional information for Accounting and Finance purposes.

You should report fees that are income generating fees and are retained by the servicer (e.g., Late Fees, Assumption Fees, Non-Sufficient Fund Fees, & Payoff Statement Fees, etc.). See “Loan Fee Type” in Allowable Values tab in the Loan Management: Servicing Events and Data Requirements document.

Delinquency reporting ensures timely and accurate tracking of a loan’s delinquency status. Expanded delinquency data improves risk management capabilities by providing a consolidated, real-time view into the status of the loan, which will eliminate the need for you to report the data into different Fannie Mae systems plus provide greater insight into borrower and servicer activities throughout the loan lifecycle.

Delinquency Status and Reason should only be reported when new information regarding the borrower’s delinquency becomes available. There is no requirement to report this monthly or at a certain interval.

Loan Delinquency Servicer Action Type - No Action Taken should be reported along with the associated reason (such as Investor Reporting Adjustment, Litigation, Foreclosure Restricted, Do Not Call, Military Service) if you are unable to take the typical delinquency-related action on the loan, like sending a late charge notice. This action type is expected to be reported once by CD22 of that reporting period. No further reporting is expected until either there is new delinquency status or reason or a new Delinquency Servicer Action is taken. 

In the future state of event-based reporting, you will be able to report one loan delinquency servicer action type at a time, with multiple delinquency reasons and/or statuses. We encourage you to report all applicable delinquency reasons and status. If more than one delinquency servicer action happens on the same day, report each one separately.

In the future state, we will no longer have numeric codes for delinquency reporting. Instead, you will report delinquency servicer action types, loan delinquency statuses, and borrower delinquency reasons based on the “Allowable Values” name (See Allowable Values tab in the Loan Management: Servicing Events and Data Requirements document).

We are expanding visibility into the taxes and insurance (T&I) information to strengthen our risk management capabilities. Enhanced insights into escrow transactional data—such as deposits and disbursements—will provide greater transparency into T&I transactions and balances.

You should report each Escrow Event—such as deposits and disbursements—on the same day, the escrow transactions are processed, but no later than 3:00 a.m. ET the following business day.

For T&I, you should select "Other" as the Escrow Item Type. This option enables the recording of escrow activity that doesn't align with predefined categories, helping ensure data completeness and promoting consistency between servicers and Fannie Mae. For Loss Draft, Renovation, and Subsidy, only one designated Escrow Item Type (excluding "Set Up") is available for reporting.

You are expected to report separate Escrow Events with Escrow Item Type = “Setup” to establish the initial balance for each active escrow account. These events should be submitted prior to any deposit or disbursement activity.

For each escrow account, report:

• The applicable Loan Escrow Item Category Type
• Loan Escrow Item Type = Setup
• The corresponding Loan Escrow Balance Amount

If your loan does not include a specific escrow account (e.g., Loan Loss Draft), you are not expected to report the Setup Event.

Visit our web page and subscribe to Selling and Servicing News emails to stay updated on changes to servicing processes and to start planning for a smooth transition.

Please direct all questions about the Lender Letter or the Servicing Event and Data Requirements to [email protected].