Fannie Mae releases updates to Sales Guide
The Sales Guide for November aimed to modernize property compliance and considerations for rental properties, and it revised the project review requirements for properties secured by a government-sponsored enterprise (GSE).
The Sales Guide also updated the requirements “relating to the analysis of the market area of the report” and added standardized definitions of valuation market areas to the glossary. It also clarifies that sellers and servicers are “responsible for preventing, detecting and reporting mortgage fraud.”
Regarding the tenancy provisions, the GSE revised the eligibility requirements to “clarify and update the tenancy requirements, address scenarios involving tenant properties in projects, and include co-ops as eligible property types,” according to the update.
The addition of the “definitive list of property types, definitions and exceptions that are suitable for the subject of lease”, as well as the execution of the first debt, assessment and .
The guide also clarified that a homeowner's association must be a “tenant” for manufactured homes located within a larger project. And it updates certain lease requirements, such as default notices and options for title treatment and consolidation. These provisions come into force from March 2025.
The guide also added project overviews for manufactured homes, including rental properties.
“In order to facilitate the lending of manufactured homes in projects, we have clarified the policy to address inconsistencies in requiring a manufactured home to be submitted to the Project Compliance Review Service (PERS),” the update said. It emphasized that manufactured homes in cooperative projects “remain ineligible project types and cannot be delivered to Fannie Mae.” This policy is effective immediately.
There is also a ratings section. Fannie Mae is working with its GSE counterparts to update requirements related to “the Market Area analysis of the appraisal report and the application of standardized definitions for the terms “Neighborhood'' and “Market Area.'' Fannie is urging sellers to implement these changes immediately, but they must. It will be in place from February 2025.
Finally, the update aims to clarify responsibilities when cases are discovered.
“Sellers and servicers are responsible for preventing, detecting and reporting mortgage fraud,” the update said. “Sellers and servicers are reminded to have policies and procedures in place to ensure the integrity of data and processes at every stage, from mortgage application to servicing.”
For any seller or servicer not already in compliance with this requirement, compliance is encouraged immediately, but must be completed by March 2025.
