Modifications have been made to the standard Escrow Waiver (cx28) and Partial Escrow Waiver (cx9826) to disclose additional details as listed in the updated Fannie Mae Selling Guide B2-1.4-04, Escrow Accounts. The additions include:
• informing the borrowers of any applicable fees associated with the waiver of escrows;
• advising borrowers that in most cases they may contact their servicer to set up an escrow account if they decide to do so even after the closing of their mortgage loan;
• advising borrowers that they are responsible for personally and directly paying the non-escrowed items, in addition to paying the mortgage loan payment; and
• explaining the consequences of a failure to pay non-escrowed items, including the requirement for the lender placement of insurance and the potentially higher cost, including any potential commission payments to the lender and/or reduced coverage for borrowers under lender-placed insurance.
Fannie Mae also encourages lenders to disclose to borrowers an estimate of the first year’s real estate taxes and insurance payment, including estimated due dates. This information currently prints on the Tax and Insurance Information Sheet (cx24). It will now also be listed on the Escrow Waiver (cx28) and Partial Escrow Waiver (cx9826) if the information is entered on the loan.
The modified documents will be available July 30, 2011.
July 28, 2011