source:
  type: guide
  id: fnma-svc-a1-3-06
  authority: Fannie Mae Servicing Guide A1-3-06 — Automatic Reclassification of MBS
    Mortgage Loans
  description: Fannie Mae Servicing Guide A1-3-06 — Automatic Reclassification of
    MBS Mortgage Loans.
  coverage_tier: operative
obligations:
- id: fnma-svc-a1-3-06-full
  canonical_id: fnma-svc-a1-3-06-full
  section: Fannie Mae Servicing Guide A1-3-06 — Automatic Reclassification of MBS
    Mortgage Loans
  type: do
  tags:
  - regulator-direct
  - fnma
  - servicing-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Fannie Mae Servicing Guide A1-3-06 — Automatic Reclassification of
      MBS Mortgage Loans
    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: 'A1-3-06, Automatic Reclassiﬁcation of MBS Mortgage Loans (10/13/2021)
      Introduction This topic contains the following: Selecting MBS Mortgage Loans
      for Reclassiﬁcation by Fannie Mae Changes to the Servicer’s Records Selecting
      MBS Mortgage Loans for Reclassiﬁcation by Fannie Mae An MBS mortgage loan typically
      must be removed from its MBS pool no later than when the mortgage loan is 24
      months past due, in accordance with Mandatory Repurchase of Certain MBS Mortgage
      Loans in A1-3-02, Fannie Mae-Initiated Repurchases, Indemniﬁcations, Make Whole
      Payment Requests and Deferred Payment Obligations. Rather than requiring the
      servicer to repurchase certain delinquent MBS mortgage loans that are serviced
      under the special servicing option—those for which Fannie Mae has the entire
      foreclosure loss risk and those for which Fannie Mae and the servicer share
      the foreclosure loss risk, with Fannie Mae having the responsibility for marketing
      the acquired property—Fannie Mae will reclassify a conventional mortgage loan
      that satisﬁes its selection criteria as an actual/actual remittance type portfolio
      mortgage loan (however, PFP mortgage loans with an original scheduled/scheduled
      remittance type will remain a scheduled/scheduled remittance type even after
      being removed from the pool). Generally, Fannie Mae will select special servicing
      option delinquent MBS mortgage loans for reclassiﬁcation when the mortgage loan
      is 24 months past due, as measured by the LPI date. However, when applicable,
      reclassiﬁcation will occur earlier than 24 months delinquency when the mortgage
      loan is: paid in full, or where the related lien is released or charged-oﬀ;
      repurchased by a seller/servicer under applicable selling and servicing requirements;
      entering a permanent modiﬁcation, which generally requires it to be removed
      from the MBS pool. During any modiﬁcation trial period, the loan will remain
      in the MBS until the trial period ends; subject to a short sale or Mortgage
      Release; or referred to foreclosure. Note: MBS mortgage loans subject to a payment
      deferral will not be selected for automatic reclassiﬁcation (see F-1-25, Reclassifying
      or Voluntary Repurchasing an MBS Mortgage Loan). Additionally, Fannie Mae will
      generally select regular servicing option MBS mortgage loans - those for which
      the servicer has the entire foreclosure loss risk and those for which Fannie
      Mae and the servicer share the foreclosure loss risk, with the servicer having
      the responsibility for marketing the acquired property - for reclassiﬁcation
      when the mortgage loan reaches six consecutive months of delinquency based on
      LPI date. The servicer must follow the procedures in F-1-25, Reclassifying or
      Voluntary Repurchasing an MBS Mortgage Loan for handling the mortgage loans
      that Fannie Mae has selected for reclassiﬁcation. Published May 13, 2026 46
      All MBS mortgage loans (regular servicing and special servicing option mortgage
      loans) removed from MBS pools will be held in Fannie Mae’s portfolio subject
      to repurchase requirements. The servicer remains responsible for the recourse
      obligation on a regular servicing option mortgage loan that is removed from
      the pool and held in Fannie Mae’s portfolio. For more details, see A1-3-02,
      Fannie Mae-Initiated Repurchases, Indemniﬁcations, Make Whole Payment Requests
      and Deferred Payment Obligations. Changes to the Servicer’s Records The servicer
      must change its internal records to reﬂect the appropriate reclassiﬁcation remittance
      type, as described in the Investor Reporting Manual and F-1-25, Reclassifying
      or Voluntary Repurchasing an MBS Mortgage Loan. Recent Related Announcements
      The table below provides references to recently issued Announcements that are
      related to this topic. Announcements Issue Date Announcement SVC-2021-07 October
      13, 2021 Announcement SVC-2021-01 January 20, 2021 Announcement SVC-2020-04
      September 9, 2020 Chapter A1-4, Breach of Contract and Nonperformance Introduction
      This chapter contains information for understanding breach of contract and nonperformance
      Section A1-4.1, Remedies Available to Fannie Mae'
  judgment: false
