Attention! Attention! | Fannie Mae Now Requires Servicers to Protect the Priority of Mortgage Liens by Clearing ALL Liens for Delinquent Homeowners’ Association Dues

Servicing Guide Announcement SVC-2012-05

Payment of Homeowners’ Association Dues and Condo Assessments

Fannie Mae requires servicers to protect the priority of the mortgage lien and to clear all liens for delinquent homeowners’ association (HOA) dues and condo assessments on properties acquired through foreclosure or deed-in-lieu of foreclosure.

Servicers must follow the policies outlined herein for all conventional mortgage loans held in Fannie Mae’s portfolio, those purchased for Fannie Mae’s portfolio but subsequently securitized into MBS pools (known as Pooled from Portfolio or PFP mortgage loans), those originally delivered as part of an MBS pool that have either a special or regular servicing option or a shared-risk MBS pool for which Fannie Mae or the servicer markets the acquired property, or other mortgage loans sold to Fannie Mae under a recourse or other credit enhancement arrangement.

Effective Date

Unless otherwise indicated, all policy changes specified in this Announcement are effective July 1, 2012; however, Fannie Mae encourages servicers to implement them as soon as possible. All other requirements provided in the associated sections of the Servicing Guide remain unchanged.

Full bulletin below…

Is somebody worried about priority here?




Servicing Guide Announcement SVC-2012-05

8 Responses to “Attention! Attention! | Fannie Mae Now Requires Servicers to Protect the Priority of Mortgage Liens by Clearing ALL Liens for Delinquent Homeowners’ Association Dues”
  1. To Tell The Truth says:

    You should read the book The Color of Demons…very interesting and quite timely although written some years ago…don’t let the name fool you…for got who the writer is but can check on amazon or internet. It is a very revealing political book…mmmm

  2. Matt says:

    In a perfect, non-borrower knowing world to the above, Chase would likely just move ahead and foreclose. If the second lien holder later found out about their actual position, 2 things would happen:

    1. They would have to re-negotiate with Chase to get what they deserve payoff-wise (if they ever get it).
    2. They would go ahead to file and foreclose realizing their position…with the new owners now living in the home…causing a mess there.


    • Bobbi Swann says:

      Ah, but in the state of Florida, when a foreclosure action is filed the plaintiff, regardless of the lien position, has to notify each and every mortgage holder of the anticipated action. This would automatically present awareness to the supposed 2nd mortgage holder. If they (Chase) presented their case as a first lien position and filed documents as such they would be committing fraud on the courts. Also, since Chase has sold this to Fannie as a first lien position as is required under the PSA that would also be considered fraud against Fannie. When you sell on the secondary market to an investor (whether it’s Fannie or otherwise) you are signing and swearing to affidavits and agreements that the position is a first lien position so that the investor can turn around and sell it off as an investment. Hence, now you have investors who purchased into securities that are basically null and void.

  3. John says:

    Our country was just fine until Barack Hussan Obama became president. We havealways taken care of our problems but for the last 3 1/2 years the government, the banks, and their attorneys have stolen homes from the lady and her mother causing the murder and suicide of two elderly people that the present administration regards as damaged goods. Do you think people in the White House shed a tear? FN. Every foreclosure program asociated with this administration has been a complete and shameful falilure and they all a laughing their way to the bank. The only way for the country to regain its dignity is to vote them all out of Washington. I am a democrat but I know a dictator when I see one. Look around you and all you see are foreclosed homes, closed businesses, high unemployment, and neighbor killing neighbor. It must stop and the best first step is to vote Obama out of office. No, all politicians are not the same. Some are bad and some are dispicable. If you love your country, vote for Romney and take our country back. Stop drinking the democratic poison and stop being in denial. This story brought tears to my eyes as well. God bless them both and God Bless America.

    • Romney, the guy that said: that the solution to the foreclosure crisis was to let the housing market hit bottom, the guy that said that corporations are people, he also said the protesters rallying against Bank of America are too young “to really understand how the economy …I can go on forever…
      Sad but is a race to the bottom !

    • j Alonzo says:

      Yes I agree, stop drinking that Democratic poison, but for god sakes dont tell me the Republicans did much better. BOTH PARTIES ARE CORRUPT!! WAKE UP!!! Do you think for a moment Romney will do anything else? Obama is just continuing what Bush did. I voted twice for Bush and now I realize both parties are a bunch of war loving, money printing, bank loving special interest Neocons. You want change? Vote for RON PAUL!!!!!!!!!!!!!!!! Grow some and get rid of that Republican Poison they have you on.
      They have so busy fighting over what party is what, when in the end they both are finding new ways to pillage our civil rights.

      • Rusty says:

        I would have voted Independent but the Independent party can’t seem to find a candidate with common sense practicability. The House and the Senate will still have the same ol’ Republicans and Democrats still in office so we will never be that “Garden of Eden” Country.

  4. Bobbi Swann says:

    Hre’s a good one for ya. I have a friend who purchase a home, took out a mortgage (Fannie/Freddit) through Chase. A couple of years later they took out a second mortgage for repairs, etc. When the market was booming they took advantage of the ‘equity; position and refinanced the first mortgage with Chase. Now comes the good part. The couple both worked for the same company which closed down and they both got laid off. They were able to keep up the payments but the marriage began to break. Unable to maintain payments by a single person Chase began with their collection efforts and threats. When he brought me the paperwork to look over just what I found? At the refinance Chase did not get a subordination from the (then) 2nd mortgage holder so when the original Chase mortgage was paid off from the refinance that moved the 2nd mortgage holder into 1st place lien position!!! When Chase threatened foreclosure I am sure that they did title work prior to initiating any legal procedure…and me thinks they finally figured out they are not in a first lien position (ha-ha). Then Chase offered a modification which they ultimately turned down. Now, they want the borrower to give them a Deed In Lieu….I told my friend to stay right where he is. Note also that the original 2nd mortgage holder does not even know that they now are in a first lien position!!!! This could prove to be one heck of a battle.

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