Fannie Mae announced it has revised its maximum fee assessment for servicers that submit late or inaccurate loan reporting. "Currently, Fannie Mae sends a Failed Business Rules Report to a servicer that fails to submit its Fannie Mae investor reporting system reports on a timely basis or fails to use the correct data and formats," the company said in a release.
Fannie Mae then fines servicers in order to recoup the losses and damages that result from servicing breaches, "including reimbursement for Fannie Mae's internal administrative costs in tracking, reporting, and correcting these errors."
For the first instance of late or inaccurate reporting, Fannie Mae will fine servicers greater of $250 or $50 per mortgage loan, up to a maximum of $5,000.
The second instance increases both figures—greater of $500 or $50 per mortgage loan, up to a maximum of $10,000. The Fannie Mae release notes in order to qualify as a second violation, late or inaccurate reporting must occur within one year of the first instance.
The third offense is a similar step up in penalties. A third instance results in $1,000 or $50 per mortgage loan, up to a maximum of $15,000, if any subsequent issue occurs within one year from the most recent previous instance.
The new fee structure goes into effect May 1, 2014.
"Fannie Mae will begin issuing warning letters and assessing compensatory fees to affected servicers for failing to meet these servicing requirements. Alternatively, Fannie Mae reserves the right to issue an indemnification demand to any servicer that breaches these servicing requirements," the release said.
Fannie Mae encourages servicers to work with their Investor Reporting and Exceptions Management Team Analysts to review and remediate the Failed Business Rules Report.