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  June 1, 2010
                                        Fannie: New Quality Control Guidelines  

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Overview

Fannie Mae announced revisions to its Selling Guide for Lender Quality Control Standards by issuing an update to its Loan Quality Initiative (LQI)

The LQI identified policies, processes, and technological enhancements involved in originating mortgage loans to Fannie's underwriting and eligibility standards, with the further goal of mitigating repurchase risk.

One consequence of the LQI was a substantial revamping of Fannie's quality control policies (QC) specified in Part D of the Selling Guide. 

The ostensible purposes of the revisions are primarily to update outdated policies and create more comprehensive audit findings. 

The new quality control requirements affect all lenders that deliver mortgage loans to Fannie Mae for purchase.


Effective Date: July 1, 2010
Highlights

Eight (8) Principal Revisions

1) Lenders must have written procedures for approving third-party originators and management procedures for third-party originations (TPOs).

2) Revisions have been made to the QC process and the QC plan.


3) Revisions have been made to outsourcing the QC audit.

4) There is a new requirement for a pre-funding QC review.


5) Revision to the sampling methodology and the timing of selection and completion of the post-closing QC audit.


6) Revision to the post-closing review process.


7) Update to Fannie's Mortgage Loan File Document Submission Requirements.


8) New requirement pertaining to the QC audit process.



Visit our Library for Issuance
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Loan Quality Initiative (LQI) FAQs (05/28/10)

Selling Guide Updates for Lender Quality Control Standards, SEL-2010-03 (03/29/10)



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