MPF Announcement 2020-40

Impact of COVID-19 on MPF Xtra Servicing

Effective Date: Immediately (unless otherwise noted)

On June 10, 2020 Fannie Mae issued updates to Lender Letter LL-2020-02 and Lender Letter LL-2020-07, respectively, which communicated updates to temporary policies previously announced, to enable servicers to better assist borrowers impacted by COVID-19. The policies in the Lender Letters are effective immediately and are effective until Fannie Mae provides further notice, unless otherwise stated.

Updates to Fannie Mae Lender Letter LL-2020-02- Impact of COVID-19 on Servicing

• Clarified that Servicers are authorized to not send a payment reminder notice to the Borrower during an active forbearance plan term.

Updates to Fannie Mae Lender Letter LL-2020-07- COVID-19 Payment Deferral

• Added a reference to the incentive fees for retention workout options introduced in Lender Letter LL-2020-09.
• Clarified when a COVID-19 impacted Borrower whose mortgage loan was modified pursuant to HAMP loses good standing.
• Clarified that the Servicer is authorized to continue solicitation for a Fannie Mae Flex Modification based on reduced eligibility criteria when a Borrower has defaulted on a COVID-19 payment deferral.
• Updated the COVID-19 payment deferral agreement in reference to the CARES Act.

PFIs and Servicers originating, delivering or servicing:

• MPF Traditional (Conventional) loans must follow the policies and guidance recently issued by the MPF Program. Please visit the MPF Website to view recently published MPF Announcements.

• MPF Government loans and MPF Government MBS loans, must follow policies and guidance issued by the applicable Government Agencies.

• MPF Direct loans, must follow policies and guidance issued by the product’s investor, Redwood Trust.

To gain a full understanding of these topics, Servicers should review the entire Fannie Mae Lender Letter plus any applicable Fannie Mae Servicing Guide chapters, forms, or exhibits noted in the announcement.