Fannie Mae Updates Servicing Manual

Fannie Mae is updating its policies and requirements in the Reverse Mortgage Loan Servicing Manual (Reverse Manual), Section 4-05, Initiation of Foreclosure Proceedings, by authorizing servicers to submit a request for a short sale when the surviving spouse or heir(s) makes a request to purchase the property and the transaction is not arm’s length.

The parties involved in such a short sale transaction are required to provide a signed Short Sale Affidavit (Form 191) at closing; however, the servicer must revise the form to delete the arms-length requirement between the seller(s) and buyer(s). Servicers must implement these policy changes by August 1, 2015.