FNMA Servicing Guide C-2 — Servicing ARM Loans

fnma-svc-c-2

Servicing Guide Chapter C-2 sets ARM loan servicing responsibilities, change notices, and buydown expiration notification timing.

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source:
  type: regulation
  id: fnma-svc-c-2
  authority: FNMA Servicing Guide C-2 — Servicing ARM Loans
  description: |
    Servicing Guide Chapter C-2 sets ARM loan servicing responsibilities, change notices, and buydown expiration notification timing.
obligations:
  - id: fnma-svc-c-2-arm-change-notice-pre-effective-date
    canonical_id: fnma-svc-c-2-arm-change-notice-pre-effective-date
    section: FNMA Servicing Guide C-2.1-02 — Notifying the Borrower Regarding Interest Rate and/or Payment Changes
    description: |
      [LENDER], as servicer of an ARM loan, must notify the borrower before
      the effective date of any change to the mortgage loan interest rate or
      monthly payment in accordance with applicable law and the mortgage loan
      security instrument. When the interest rate and the monthly payment
      change at different intervals, separate notices are required for each
      change.
    type: do
    audit_question: For every ARM interest rate or monthly payment change on a Fannie Mae ARM loan, can [LENDER] evidence a borrower notice sent before the change effective date, compliant with applicable law and the security instrument, with separate notices issued where rate and payment change at different intervals?
    program_review: Does the program ensure ARM rate/payment-change notices go to the borrower before the change effective date per applicable law and the security instrument, with separate notices when rate and payment change at different intervals?
    file_review: For ARM rate/payment changes, confirm a pre-effective-date notice (and separate notices where rate and payment change on different intervals).
    judgment: false
    feeds: []
    workflow_phase: servicing
    owner_role: default_servicing_analyst
    secondary_owner_role: compliance_officer
    cadence: per-event
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - fnma
      - servicing-guide
      - arm
      - change-notice
      - promoted
    primary_source:
      tier: 1
      authority: FNMA Servicing Guide C-2.1-02
      source_class: fnma-guide
      source_url: https://singlefamily.fanniemae.com/media/document/pdf/servicing-guide
      snapshot_id: cf63a82bbb4adfba
      fetched_at: '2026-05-22T23:53:19Z'
      content_hash: sha256:89df66c43baad07f8a8dd9d224492fff7d15e8839edba02ad0e74c7e50fe5da3
      paragraph_quote: The servicer of an ARM loan must notify the borrower before the eﬀective date of any change to the mortgage
      drafter_attestation: |
        Copied verbatim from FNMA Servicing Guide snapshot cf63a82bbb4adfba (chapter C-2) at 2026-05-22.
    promoted_at: '2026-05-23T00:25:10+00:00'
    promoted_from: fnma-svc-c-2-roundb-v1.yaml
  - id: fnma-svc-c-2-buydown-expiration-90-day-notice
    canonical_id: fnma-svc-c-2-buydown-expiration-90-day-notice
    section: FNMA Servicing Guide C-2.1-02 — Notifying the Borrower Regarding Interest Rate and/or Payment Changes
    description: |
      For a Fannie Mae ARM loan subject to a temporary interest rate buydown
      plan, [LENDER] must send notification detailing the pending interest
      rate increase to the borrower 90 days prior to the payment change.
    type: do
    audit_question: For every Fannie Mae ARM loan subject to a temporary interest rate buydown plan that is about to expire, can [LENDER] evidence a borrower notice detailing the pending interest rate increase sent 90 days prior to the payment change?
    program_review: Does the program ensure that for ARM loans with a temporary buydown plan, a notice detailing the pending rate increase is sent 90 days before the payment change?
    file_review: For buydown-plan ARM loans nearing expiration, confirm the rate-increase notice 90 days before the payment change.
    judgment: false
    feeds: []
    workflow_phase: servicing
    owner_role: default_servicing_analyst
    secondary_owner_role: compliance_officer
    cadence: per-event
    consequence: ''
    tags:
      - round-b
      - regulator-direct
      - fnma
      - servicing-guide
      - arm
      - buydown
      - 90-day-notice
      - promoted
    primary_source:
      tier: 1
      authority: FNMA Servicing Guide C-2.1-02
      source_class: fnma-guide
      source_url: https://singlefamily.fanniemae.com/media/document/pdf/servicing-guide
      snapshot_id: cf63a82bbb4adfba
      fetched_at: '2026-05-22T23:53:19Z'
      content_hash: sha256:89df66c43baad07f8a8dd9d224492fff7d15e8839edba02ad0e74c7e50fe5da3
      paragraph_quote: temporary interest rate buydown plan to the borrower 90 days prior to the payment change.
      drafter_attestation: |
        Copied verbatim from FNMA Servicing Guide snapshot cf63a82bbb4adfba (chapter C-2) at 2026-05-22.
    promoted_at: '2026-05-23T00:25:10+00:00'
    promoted_from: fnma-svc-c-2-roundb-v1.yaml
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  - promoted_at: '2026-05-23T00:25:10+00:00'
    candidate_path: C:\Users\earlc\broker-tools\obligations\_remediation\_round_b_drafts\fnma-svc-c-2-roundb-v1.yaml
    candidates_promoted: 2
    candidates_skipped_existing: 0

Verbatim regulatory text (2)

Verbatim provisions from FNMA Servicing Guide C-2 — Servicing ARM Loans — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.

FNMA Servicing Guide C-2.1-02 — Notifying the Borrower Regarding Interest Rate and/or Payment Changes

The servicer of an ARM loan must notify the borrower before the eﬀective date of any change to the mortgage

Source: FNMA Servicing Guide C-2.1-02 · source URL · snapshot cf63a82bbb4adfba

FNMA Servicing Guide C-2.1-02 — Notifying the Borrower Regarding Interest Rate and/or Payment Changes

temporary interest rate buydown plan to the borrower 90 days prior to the payment change.

Source: FNMA Servicing Guide C-2.1-02 · source URL · snapshot cf63a82bbb4adfba