Fannie Mae announces changes to origination requirements

Federal Issues Covid-19 GSE Fannie Mae

On March 23, Fannie Mae issued Lender Letter LL-2020-03 addressing the impact of Covid-19 on Originations. The letter (i) establishes permissible alternatives to the verbal verification of employment requirement; (ii) encourages lenders to “practice additional due diligence” with respect to continuity of income to ensure most recent information is obtained; (iii) extends the deadline for lender submission of financial statements and Form 582 until April 30, 2020; (iv) reiterates the requirements to maintain the original copy of the promissory note and to obtain an original, non-electronic signature on promissory notes unless originated as an electronic note; (v) addresses title insurance consequences of recording office closures; and (vi) reminds lenders to follow their business continuity and resiliency plans.