Fannie Mae (FNMA) released Servicing Guide Announcement 2018-01, making a handful of clarifying changes that are effective immediately, to Guide Section B-5-1, Insured Loss Events.
The text in bold below indicates the Guide section revisions:
- Note: The servicer and/or the insurance company may not have reason to believe that a supplemental claim will be filed for additional damages at the time the initial loss proceeds are paid by the insurer; therefore, the servicer must disburse any insurance loss proceeds based on the requirements in this Guide without regards to whether supplemental loss proceeds will be received.
- The servicer must release the insurance loss proceeds received from the insurance carrier based on the status of the mortgage loan when the servicer receives notification of damage to the property.
- Mortgage Loans Current or Less Than 31 Days Delinquent
- Note: If the borrower has made advance payments to the contractor and/or to purchase materials, then the servicer is authorized to reimburse the borrower by releasing insurance loss proceeds payable only to the borrower as evidenced by paid receipts. Receipts are not necessary if the loss proceeds are less than or equal to $20,000.
If you have any questions, please contact your PFI client relationship manager.