Fannie Mae Selling Guide D1-3-03 — Lender Post-Closing Quality Control Reverifications

Fannie Mae Selling Guide D1-3-03 — Lender Post-Closing Quality Control Reverifications

D1-3-03, Lender Post-Closing Quality Control Reverifications (04/01/2026) Introduction This topic contains information on the lender's post-closing QC reverifications, including: Overview Requirements for Reverifications Overview The reverification process is designed to confirm the authenticity of the loan documentation and verify the accuracy and integrity of the information relied upon in the underwriting decision. The process also serves to substantiate that no material changes have occurred that would affect the loan's eligibility as delivered to Fannie Mae. For QC random reviews, the lender must request reverification of the components of the loan file utilized for qualification, which may include income, employment, assets, liabilities, valuation (appraisal or property data collection), and occupancy. The lender must use the information in the reverification documentation to reconcile the information used to underwrite the loan and make the lending decision. Published May 6, 2026 1056 Requirements for Reverifications The lender must pay any applicable fees charged by employers, financial institutions, or other third- parties used to obtain reverification information. The lender may supplement reverification processes with alternative information sources available online, sources maintained by government agencies or other licensing authorities, and through the use of other third- parties to obtain a successful reverification result. If the reverification process reveals information that differs from what was used in underwriting, the lender must re-underwrite the loan to confirm its eligibility for delivery to Fannie Mae. For all loans selected for full-file review, the post-closing random QC review must reverify the following: income and employment, income tax returns, assets, credit history, property eligibility and property value, and occupancy. If the lender cannot obtain required post-closing QC reverifications, the lender must document the loan file with the request date, and that the information requested was not obtained. The lender must track reverification results, including successful reverifications and unsuccessful attempts. The borrower's income, employment, or assets do not have to be reverified (or recalculated) if they were validated by the DU Validation Service, and the lender satisfied all the requirements for obtaining representation and warranty enforcement relief (as described in A2-2-04, Limited Waiver and Enforcement Relief of Representations and Warranties), and the loan closed by the "Close by Date" stated in the DU validation message. For loans with representation and warranty enforcement relief related to undisclosed non-mortgage liabilities, the lender is not required to re-underwrite the loan to confirm its eligibility for delivery to Fannie Mae when: the new, post-closing QC credit report reveals non-mortgage debt that was not disclosed by the borrower or discovered by the lender prior to or concurrent with the day of closing, the lender's review of the file does not identify inconsistencies between the data or information in the loan file and the information submitted to DU, and all conditions for eligibility for relief described in A2-2-04, Limited Waiver and Enforcement Relief of Representations and Warranties have been met, including the reconciliation of conflicting and contradictory information and closing by the credit report expiration date. Income and Employment The lender must reverify the income and employment that was used to underwrite the loan and confirm that all income of all borrowers has not changed to the point where the loan is ineligible for delivery to Fannie Mae. Reverification of income and employment must align with the documentation requirements for the applicable income type. If the lender is required to document income using IRS W-2 forms for the most recent one-year Published May 6, 2026 1057 period in addition to a year-to-date paystub, all income and employment documents covering that period must be reverified. This includes reverification of each employer if the borrower had more than one employer during the applicable timeframe. When an automated income verification was obtained directly from an approved Fannie Mae vendor, reverification of that income is not required. A verbal reverification of employment and income is acceptable if the lender documents the conversation, including the date, name, title, and contact information of the person providing the details. Income Tax Returns The post-closing QC review must include the lender's submission for tax transcripts to the IRS (or designee) using the IRS Form 4506-C (or an alternative IRS form or process that authorizes the release of comparable tax information) when tax returns were required and relied upon in underwriting to support the borrower's income. Tax transcripts obtained through post-closing QC are used to reverify the accuracy and authenticity of the tax returns that supported the underwriting decision. The lender must reconcile the IRS transcript information with the corresponding income documentation in the loan file. See B3-3.1-02, Tax Return and Transcript Documentation Requirements, for detailed information. The following exception applies: If the lender obtained the appropriate IRS transcripts during its preclosing process (processing and underwriting), it may use the same documents in its post-closing QC process, without ordering new transcripts. Assets The lender must request reverification of all sources of funds used for the down payment, closing costs, and reserves. Reverification must be performed using the original documentation. The reverification documentation obtained in post-closing QC must be compared to the documentation from origination to authenticate the amounts used are accurate and to ensure no documentation alterations were made. If the lender confirms that an institution will not reverify asset account information on a systemic basis and maintains a separate log documenting the lender's confirmation of each institution's process, the lender is not required to document the reverification attempt for each individual loan. The lender must establish and follow a routine to reverify the institution's process and remains responsible for the accuracy and integrity of the information. When an automated asset verification was obtained directly from an approved Fannie Mae vendor, reverification of that asset is not required. When a third-party asset verification report is provided to DU for an assessment of rent payment history or a cash flow assessment, reverification of the full 12 months of asset data is not required. Reverification of the assets used specifically for verification of assets is required as described above. Credit History The post-closing QC review must include reverification of the borrower's credit history. If a borrower's credit was evaluated by using a traditional credit report, the lender must reverify the borrower's credit history by obtaining a new tri-merge credit report. The new report does not need to generate a new Published May 6, 2026 1058 inquiry that will appear on future credit reports or include trended credit data; even if reflected on the credit report used for underwriting purposes. The lender is not required to analyze trended credit data in the new credit report. If a borrower's credit history was evaluated by using nontraditional credit or a nontraditional mortgage credit report, the lender must reverify each of the credit references on that report. If the lender obtained written references from creditors, the lender's QC review process must include reverification of each of the credit references. The liability information obtained on the new credit report must be reconciled against the credit report or references used at the time of underwriting to identify any discrepancies or the existence of any debt that may not have been taken into account when the loan was underwritten. Property Eligibility and Property Value The lender must complete a collateral risk assessment for loans with an appraisal or property data collection. Full appraisal collateral risk assessment must include the elements shown in the following table. ✓ The lender must... determine the property meets eligibility requirements including the LTV, CLTV, and HCLTV ratios. assess the appropriateness of comparable sales. Appraisal comps do not have to be reverified on appraisals with a Collateral Underwriter (CU) score of 2.5 or below if the lender satisfied all the requirements for obtaining representation and warranty enforcement relief (as described in A2-2-06, Representations and Warranties on Property Value. assess the appropriateness of the data presented and verify the appraisal report complies with B4-1.1-04, Unacceptable Appraisal Practices. conclude that the rationale for the reconciliation of value is supported. reconcile flags and messages that were identified in Collateral Underwriter (CU) if the property was able to be scored in CU. If the property was not able to be scored in CU, then reconcile any known quality messages (messages, alerts, flags) reflected in other third-party tools, if utilized. If the lender is unable to complete the collateral risk assessment or evaluate the origination appraisal, it may order either a desk review or field review from a licensed appraiser. The desk review or field review must account for all of the above collateral risk assessment requirements. Property data collection collateral risk assessment must include the elements shown in the following table. Published May 6, 2026 1059 ✓ The lender must... assess the accuracy of the data obtained through the property data collection. identify any property eligibility issues and items of safety, soundness, or structural integrity concern. determine whether the lender appropriately required repairs or inspections. Occupancy The post-closing QC review must include occupancy assessment for the subject property. The lender must review the loan file documentation (for example, property insurance policy, appraisal, income tax returns or transcripts, lease agreements, etc.) to confirm the documented occupancy is accurate. When occupancy red flags are identified, the lender must further investigate. For example, the lender may use publicly available listing or sale information or hire a door-knock service to ensure the occupancy status is accurate. Recent Related Announcements The table below provides references to recently issued Announcements that are related to this topic. Announcement Issue Date Announcement SEL-2026-03 April 01, 2026 Announcement SEL-2025-09 November 05, 2025 Announcement SEL-2025-04 June 04, 2025 Announcement SEL-2019-03 April 03, 2019 Subpart D2, Fannie Mae QC Process Introduction Fannie Mae’s Loan Quality Center reviews a sample of the mortgage loans purchased or securitized by Fannie Mae to ensure that they meet its underwriting and eligibility requirements. This subpart describes Fannie Mae’s policies and practices with respect to the selection, review, and reporting of results; and the lender’s responsibilities for participating in this process. Fannie Mae also reviews servicing files with the primary focus of Published May 6, 2026 1060 confirming that the mortgage loan has been serviced in accordance with the and Lender Contract. See the for a description of the servicing QC process. In addition, within the Loan Quality Center, the Data Validation Center team follows up on loan-level data discrepancies to perform required data changes that, in some instances, may indicate eligibility concerns leading to a full underwriting review. Chapter D2-1, General Information on Fannie Mae QC Process Introduction This chapter provides general information on the Fannie Mae QC reviews that focus on underwriting and eligibility requirements.

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