Fannie Mae Servicing Guide A4-2.2-04 — Law Firm Suspensions, Matter Transfers, and Terminations

Fannie Mae Servicing Guide A4-2.2-04 — Law Firm Suspensions, Matter Transfers, and Terminations

A4-2.2-04, Law Firm Suspensions, Matter Transfers, and Terminations (08/15/2018) Introduction This topic contains the following: Servicer-Directed Suspensions Fannie Mae-Directed Suspensions Implementation of Suspensions Servicer-Directed Suspensions The following table provides instructions for the servicer regarding the suspension of referrals, law firm matter transfers, and termination of law firms. If… Then the servicer must… the servicer becomes aware of information regarding a law firm handling Fannie Mae default-related matters that might warrant a suspension of referrals, the transfer of matters to another law firm, and/or the termination of the law firm (for example, due to legal, reputational, or operational risk) • notify Fannie Mae within two business days or sooner if circumstances warrant as set forth in Escalations of Law Firm and Servicer Issues and Government and Media Inquiries in A4-2.2-02, Law Firm Management and Oversight, and • conduct due diligence with respect to the issue. Published May 13, 2026 160 If… Then the servicer must… the servicer intends to suspend referrals and/or terminate a law firm • provide Fannie Mae with prior notice at least five business days before implementing the decision, • provide Fannie Mae with the implementation plan for the course of action chosen by the servicer, • inform the law firm of the decision, and • keep Fannie Mae periodically updated with respect to the status of implementation of the decision. the servicer is transferring matters to another law firm refer to Servicing Guide E-1.1-01, General Requirements for Referring a Mortgage Loan to a Law Firm for the requirements for notifying Fannie Mae of the transfer of default-related matters. The servicer must retain all information relating to its due diligence review, its decision, and all other information supporting its decision for the longer of any retention period applicable to the servicer, or seven years after the decision. The servicer must make such information available to Fannie Mae upon request. Fannie Mae-Directed Suspensions Fannie Mae reserves the right to direct the servicer to initiate an investigation of a law firm if it becomes aware of information that might warrant a suspension of referrals, the transfer of law firm matters, or termination of the law firm. Fannie Mae may itself conduct due diligence and investigations as necessary, and may instruct the servicer to suspend some or all new referrals, to transfer some or all of its matters, or to terminate law firms. In the event of a decision by Fannie Mae to suspend new referrals, transfer matters, or terminate a law firm, Fannie Mae will inform the servicer of the decision and provide direction regarding required servicer actions. Implementation of Suspensions The servicer is responsible for implementing any suspension, transfer of law firm matters, and/or termination unless otherwise directed by Fannie Mae. The servicer must consider all pertinent factors when determining the proper implementation strategy for any suspension, law firm matter transfers, and/or termination, including: the capacity of other eligible law firms in the jurisdiction to handle additional capacity and/or transferred Published May 13, 2026 161 matters, the proration of fees between the transferor and transferee law firms, avoiding duplicative fees and costs as a result of any transfer, and the continuing availability of adequate errors and omissions coverage for a law firm as to which some matters are left for resolution following a suspension of referrals or partial transfer of matters. With respect to any required matter transfer, the servicer must take all required steps to effectuate, manage, and monitor the transfer and report periodically to Fannie Mae regarding the identity of each transferee law firm, the identification and quantification of the matters transferred to each transferee law firm, and the timing and status of the law firm matter transfer. The servicer must not charge Fannie Mae or the borrower for any fees or costs associated with transferring matters, and such amounts must not be added to the borrower’s total indebtedness. Fannie Mae reserves the right to manage any suspension, transfer of matters, and/or termination if it concludes that Fannie Mae's management is necessary to manage legal, reputational, or operational risks. The servicer must follow all reasonable instructions given by Fannie Mae. Recent Related Announcements There are no recently issued Announcements related to this topic. Published May 13, 2026 162 Part B, Escrow, Taxes, Assessments, and Insurance Introduction This part describes how to administer an escrow account to manage taxes, assessments, and insurance requirements. Published May 13, 2026 163 Chapter B-1, Escrow Account Administration Introduction This chapter describes escrow account administration.

Source: Fannie Mae Servicing Guide A4-2.2-04 — Law Firm Suspensions, Matter Transfers, and Terminations · source URL · snapshot cf63a82bbb4adfba