source:
  type: guide
  id: fnma-svc-a4-2.2-02
  authority: Fannie Mae Servicing Guide A4-2.2-02 — Law Firm Management and Oversight
  description: Fannie Mae Servicing Guide A4-2.2-02 — Law Firm Management and Oversight.
  coverage_tier: operative
obligations:
- id: fnma-svc-a4-2.2-02-full
  canonical_id: fnma-svc-a4-2.2-02-full
  section: Fannie Mae Servicing Guide A4-2.2-02 — Law Firm Management and Oversight
  type: do
  tags:
  - regulator-direct
  - fnma
  - servicing-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Servicing Guide A4-2.2-02 — Law Firm Management and Oversight
    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: 'A4-2.2-02, Law Firm Management and Oversight (11/12/2014) Introduction
      This topic contains the following: Overview of Law Firm Management and Oversight
      Establishing Written Policies and Procedures Related to Law Firm Oversight and
      Compliance Conducting Law Firm Compliance Reviews and Training Reporting Law
      Firm Performance to Fannie Mae Escalations of Law Firm and Servicer Issues and
      Government and Media Inquiries Overview of Law Firm Management and Oversight
      The servicer is fully responsible for managing and overseeing all aspects of
      the performance and compliance of any law ﬁrm to which it makes a referral,
      including foreclosure prevention activities and timeline performance. The servicer
      must interact with the law ﬁrm as necessary throughout the course of the foreclosure
      or bankruptcy proceedings in order to ensure that the matters are completed
      in a timely manner, in accordance with applicable law, and in accordance with
      the requirements of the Servicing Guide, including the requirement that the
      servicer timely deliver good and marketable title to Fannie Mae following a
      foreclosure. The servicer must obtain, review, and analyze data and reports
      from the law ﬁrms and take appropriate action as necessary. The servicer is
      accountable and responsible to Fannie Mae for any delays or losses resulting
      from deﬁciencies in the law ﬁrm’s performance. The servicer must reimburse Fannie
      Mae for any losses suﬀered because a law ﬁrm did not meet its responsibilities.
      The following table lists the servicer''s ongoing responsibilities following
      referral to a law ﬁrm. ✓ After referral, the servicer must… Continue pursuing
      foreclosure prevention eﬀorts. Keep the law ﬁrm apprised about the status of
      any workout proposals, bankruptcy ﬁlings, or other events that aﬀect the matter.
      Provide any additional documentation, information, or signatures to the law
      ﬁrm, as needed. Published May 13, 2026 154 ✓ After referral, the servicer must…
      Advance funds to pay attorney fees and costs. Provide bidding instructions.
      File applicable IRS forms related to paying attorney fees. Monitor timeline
      performance. Obtain and review data and reports from law ﬁrms and take appropriate
      actions as necessary. Fulﬁll all of its other servicing obligations. The servicer
      must also ensure that the law ﬁrm is able to process foreclosures and bankruptcies
      in a timely and eﬃcient manner, recognize and facilitate foreclosure prevention
      whenever possible, and quickly obtain relief from the bankruptcy so that foreclosure
      proceedings may be initiated or continued, when appropriate. Establishing Written
      Policies and Procedures Related to Law Firm Oversight and Compliance The servicer
      must develop and have in place policies and procedures regarding oversight and
      compliance relating to law ﬁrms handling Fannie Mae default-related matters.
      The servicer must have policies and procedures reasonably designed to ensure
      that the law ﬁrms handling of Fannie Mae default-related matters are in compliance
      with the Mortgage Default Counsel Retention Agreement with Fannie Mae, the applicable
      provisions of the Servicing Guide, and applicable law. Conducting Law Firm Compliance
      Reviews and Training The servicer must conduct periodic law ﬁrm compliance reviews
      and training as appropriate. In determining the frequency of ﬁrm compliance
      reviews, the servicer must consider the overall risk posed by the ﬁrm (legal,
      reputational, and ﬁnancial), ﬁrm volume, performance, any changes in staﬃng
      ratios or levels, any litigation against the ﬁrm alleging systemic issues, any
      media coverage regarding the ﬁrm, and the prior results of any ﬁrm compliance
      reviews. Compliance Reviews: The servicer''s ongoing compliance monitoring must
      address the following minimum elements. Published May 13, 2026 155 ✓ Elements
      of the servicer’s ongoing compliance monitoring that must be maintained Ongoing
      eligibility under Fannie Mae minimum requirements. Compliance with the limited
      retention agreement with Fannie Mae, including the fee and cost guidelines.
      Compliance with the applicable provisions of the Servicing Guide. Compliance
      with applicable law. Law ﬁrm capacity. Reputational risk issues, for example,
      complaints against the law ﬁrm, bar complaints, sanction proceedings, or investigations
      by regulatory or law enforcement authorities. Veriﬁcation that the law ﬁrm has
      eﬀective controls in place related to information security, data management,
      and fraud prevention. Document custody practices. Business continuity. Maintenance
      of appropriate errors and omissions coverage. Financial viability. Adequacy
      of staﬃng. Applicable ratios (attorney to staﬀ; attorney to ﬁle, and staﬀ to
      ﬁle) and the law ﬁrm’s management of the ratios. Training. Quality of work.
      The servicer must make available to Fannie Mae upon request the materials relating
      to its performance and compliance monitoring of law ﬁrms providing default-related
      legal services, including Published May 13, 2026 156 information regarding the
      servicer''s compliance monitoring, including scope and methodology, the schedule
      of law ﬁrm compliance reviews conducted, the identity of any vendors used in
      the law ﬁrm compliance reviews, any documentation from the law ﬁrm compliance
      reviews, and any ﬁndings, reports or remediation plans resulting from the law
      ﬁrm compliance reviews. Fannie Mae reserves the right to review and require
      changes to the servicer''s compliance process, as well as to require the servicer
      to conduct additional compliance activities related to law ﬁrms handling its
      default matters. In addition, Fannie Mae may require the servicer to change
      the scope of its compliance process in connection with Fannie Mae mortgage loans.
      Fannie Mae also reserves the right to directly conduct law ﬁrm audits and law
      ﬁrm on-site visits as deemed necessary. Ongoing Training: The servicer must
      ensure that law ﬁrms receive any necessary training, including information regarding
      Fannie Mae requirements, such as Servicing Guide Announcements that may aﬀect
      the law ﬁrms. Although Fannie Mae may conduct mandatory law ﬁrm training from
      time to time, the servicer is responsible for ensuring that law ﬁrms are aware
      of Fannie Mae’s requirements. Reporting Law Firm Performance to Fannie Mae The
      servicer must generate and provide in a timely manner data and reports requested
      by Fannie Mae related to, among other things, servicer performance in managing
      the foreclosure and bankruptcy processes and oversight of law ﬁrm performance
      and compliance. The servicer must provide Fannie Mae access, as requested, to
      data in its servicing systems regarding Fannie Mae mortgage loans. Fannie Mae
      will periodically specify the required data and reports on Fannie Mae’s website.
      Escalations of Law Firm and Servicer Issues and Government and Media Inquiries
      Within two business days of discovery, or sooner if circumstances warrant, the
      servicer must notify Fannie Mae of matters requiring Fannie Mae''s attention,
      including the following: any information regarding a law ﬁrm that might warrant
      a suspension of referrals, the transfer of matters to another law ﬁrm, and/or
      termination of the law ﬁrm; information suggesting legal or reputational risk
      posed by a law ﬁrm, e.g., bar complaints, sanction proceedings, or litigation
      asserting systemic issues with the law ﬁrm or its practices; any actual or suspected
      data security breach involving the law ﬁrm; any actual or alleged fraud on the
      part of a law ﬁrm; federal, state, or local governmental inquiries, including
      Congressional inquiries, that involve a signiﬁcant legal or reputational risk
      issue related to a law ﬁrm selected and retained to perform default-related
      legal services on Fannie Mae mortgage loans or that involve a signiﬁcant legal
      or reputational risk issue related to default-related practices of the servicer
      on Fannie Mae mortgage loans; media inquiries related to a law ﬁrm selected
      and retained to perform default-related legal services on Fannie Mae mortgage
      loans or default-related practices of the servicer on Fannie Mae mortgage loans;
      Published May 13, 2026 157 volume or capacity issues with a law ﬁrm; a breach
      of the limited retention agreement between Fannie Mae and a law ﬁrm; any systemic
      issues with a law ﬁrm; signiﬁcant issues with the servicer''s process for handling
      delinquent mortgage loans, e.g., an issue that causes widespread foreclosure
      delays or an issue that requires remediation eﬀorts be taken with respect to
      mortgage loans in one or more jurisdictions; or any material change in the ownership,
      partnership, or organization of the law ﬁrm after executing the limited retention
      agreement, including instances where a named partner leaves the law ﬁrm or a
      practice group separates from the law ﬁrm. Fannie Mae reserves the right to
      issue direction to servicers and law ﬁrms regarding escalated matters. Escalation
      Process: Escalated matters must be reported to Fannie Mae’s Legal department
      via email (see F-4-02, List of Contacts). The following table provides additional
      instructions for escalating matters to Fannie Mae. ✓ When the servicer provides
      Fannie Mae notice of a matter requiring Fannie Mae’s attention, the servicer
      must… Designate in its email one or more points of contact. Promptly obtain
      and provide Fannie Mae with any additional information requested from the law
      ﬁrm. Recent Related Announcements There are no recently issued Announcements
      related to this topic. A4-2.2-03, Prohibition Against Servicer-Speciﬁed Vendors
      for Fannie Mae Referrals, Use of Vendors, and Outsourcing Companies (04/12/2017)
      The servicer cannot directly or indirectly require or encourage law ﬁrms to
      use speciﬁed vendors in connection with Fannie Mae referrals, including, but
      not limited to title companies, Published May 13, 2026 158 posting and publication
      vendors, and service of process vendors. The law ﬁrm must be allowed to select
      vendors of its choice based on its assessment of factors such as the cost eﬃciency,
      quality, reliability, and timeliness of the services provided by the vendor.
      Arrangements with vendors and other service providers, particularly aﬃliates,
      must not be inﬂuenced by an actual or perceived conﬂict of interest. The servicer
      and law ﬁrm must use the most cost-eﬃcient and eﬀective vendors to assist in
      processing foreclosures and bankruptcy cases without regard to arrangements
      that could provide a ﬁnancial beneﬁt directly or indirectly to the servicer.
      The law ﬁrm must obtain Fannie Mae’s prior written approval if it wishes to
      use a vendor that is the servicer itself, an outsourcing company, or other third-party
      vendor utilized by the servicer to assist in servicing defaulted mortgage loans,
      or an aﬃliate of the servicer, outsourcing company, or third-party vendor. Requests
      for approval must be directed to Fannie Mae’s Legal Department via email (see
      F-4-02, List of Contacts). The servicer must not enter into or participate in
      any arrangements with an outsourcing company or third-party vendor pursuant
      to which the servicer receives a direct or indirect beneﬁt of any kind (such
      as a lower charge for services or a payment) for referring a foreclosure or
      bankruptcy matter relating to a Fannie Mae mortgage loan to a particular law
      ﬁrm. In addition, the servicer must obtain prior written approval from Fannie
      Mae’s Legal Department before entering into any arrangement with an outsourcing
      company or third-party vendor that is not an approved Fannie Mae servicer involving
      the outsourcing company or third-party vendor undertaking all or substantially
      all of the servicer’s responsibilities with respect to servicing loans in bankruptcy
      (see F-4-02, List of Contacts). Outsourcing companies or third-party vendors
      must not be permitted to directly or indirectly select, or inﬂuence the selection
      of, the law ﬁrms to be used on Fannie Mae mortgage loans. The servicer, its
      agents, or any outsourcing ﬁrm it employs may not charge either directly or
      indirectly any outsourcing fee, referral fee, packaging fee, or similar fee
      in connection with any Fannie Mae mortgage loan. This requirement is in place,
      in part, to deter actual and potential conﬂicts of interest that may arise and
      compromise the overall eﬀectiveness of service provided to Fannie Mae. To help
      ensure compliance with this requirement, Fannie Mae explicitly prohibits the
      following parties from directly or indirectly charging any amounts to (or receiving
      any payments or any beneﬁts from) law ﬁrms or their aﬃliates in connection with
      any Fannie Mae mortgage loan or service provided directly or indirectly with
      respect to any Fannie Mae mortgage loan except as Fannie Mae may expressly permit
      the servicer, any outsourcing company or other third-party vendor utilized by
      the servicer to assist in servicing defaulted mortgage loans (for example, referring
      loans to foreclosure or bankruptcy, monitoring law ﬁrm performance, or providing
      administrative support services), and any aﬃliate of the servicer, outsourcing
      company, or third-party vendor. Fannie Mae does expressly permit the beneﬁt
      that servicers may receive from law ﬁrms having access to and utilizing data
      obtained from the servicer''s systems through "direct sourcing" arrangements.
      Any other charges, payments, or beneﬁts from law ﬁrms or their aﬃliates in connection
      with Fannie Mae mortgage loans will require Fannie Mae''s prior written approval.
      Published May 13, 2026 159 The servicer is responsible for ensuring compliance
      with these requirements. The servicer must diligently monitor and manage any
      outsourcing company or vendor it utilizes to assist with the servicing of defaulted
      mortgage loans to ensure all Fannie Mae servicing guidelines are fully met in
      a timely and cost-eﬀective manner. Recent Related Announcements There are no
      recently issued Announcements related to this topic.'
  judgment: false
