Fannie Mae Announces New Document Custodian Requirements
by Sarah Lagattolla
Vice President
On May 9, 2012 Fannie Mae announced the requirement for all lender-affiliated and independent document custodians to utilize third party QC audit services for an annual compliance audit to assess eligibility and operational compliance.
Fannie Mae further announced the requirement for document custodians to establish a monthly quality control review process in addition to an annual third party audit. The announcement was made in Fannie Mae’s Servicing Guide Announcement SVC-2012-08.
Document custodians who hold or certify loan documents on behalf of Fannie Mae will be required to certify that an independent third party firm has completed an audit and that those results reflect compliance with Fannie Mae’s minimum standards as set forth in the Requirements for Document Custodians Guide.
The annual third party review implementation must occur no later than:
- July 31, 2013, if the last Fannie Mae on-site audit of the document custodian occurred prior to August 1, 2011
or - December 31, 2013 if the last Fannie Mae on-site audit of the document custodian occurred between the dates of August 1, 2011 and July 31, 2012
Document custodians must develop a monthly quality control review process no later than September 30, 2012. This new QC plan must be implemented no later than October 31, 2012 for the September, 2012 sample period.
Document custodians are currently required to submit Form 2001: Annual Statement of Eligibility for Document Custodians, no later than March 31 of each year to reflect compliance with Fannie Mae’s requirements.
Form 2001 asks document custodians to certify information including, but not limited to, vault and Note storage, disaster recovery plans, written policies and procedures, and compliance with Fannie Mae’s Seller/Servicer Guide & Requirements for Document Custodians Guide. This form will be updated to reflect the new requirements as outlined in this announcement, as well as the requirements that will be detailed in the updated guide yet to be released.
Details pertaining to the requirements of the monthly QC process as well as minimum standards for independent third party annual audits will be published by Fannie Mae by August 31, 2012. At this time a revised Requirements for Document Custodians Guide containing these requirements will be made available as well as the revised Form 2001.
Anna DeSimone founded Bankers Advisory in 1986 and is a nationally recognized authority in residential mortgage lending. She has received numerous industry awards and has authored more than 40 best practices guides and hundreds of articles.
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