Fannie Mae

1
Fannie Mae eMortgages

• Pam Holland
• Associate General Counsel
• Fannie Mae

2
Overview

• History
• Legal Framework
• eMortgage Guide
• Our Experiences
• Whats Next?

3
HISTORY

• 2000
• Began Legal Framework Analysis
• Purchased First 2 eMortgages in Secondary Market
• SMART Doc Concepts and Specifications
• 2002
• Registry Concept Introduced
• Issued Announcement 02-08 June 2002
• Open for Business purchasing eMortgages
• 2005
• Guide Update
• MERS eRegistry

4
Legal Framework

• ESIGN and UETA
• Notwithstanding any law to the contrary, a
  signature, contract, may not be denied legal
  effect because it is in electronic form
• Transferable Record provisions make eNotes
  equivalent to paper negotiable instruments
• MERS eNote Registry
• Provides simplified means of compliance with
  Transferable Record provisions of ESIGN and UETA

5
Legal Framework

• Uniform eNote Clause Key Provisions
• Borrowers agreement to the electronic
  transaction
• (A) I expressly state that I have signed this
  electronically created Note (the "Electronic
  Note") using an Electronic Signature

6
Legal Framework

• Uniform eNote Clause cont
• eNote Registry
• (B).the identity of the Note Holder and any
  person to whom this Electronic Note is later
  transferred will be recorded in a registry
  maintained by MERS
• The current identity of the Note Holder and the
  location of the authoritative copy, will be
  available from the Note Holder or Loan Servicer,
  as applicable.
• The only copy of this Electronic Note that is
  the authoritative copy is the copy that is within
  the control of the person identified as the Note
  Holder in theRegistry (or that persons
  designee).

7
Legal Framework

• Uniform eNote Clause - cont
• Provision for failure to register
• Provision in event of need to convert to paper

8
eMortgage Guide Fannie Maes Requirements

• Getting Started
• eMortgage Guide (Updated June 2005)
• available on eFannieMae.com (search on
  eMortgage)
• Consultative process
• Contract
• amendment to Master Agreement that incorporates
  eMortgage Guide

9
eMortgage Guide Fannie Maes Requirements

• Documentation Requirements
• Uniform eNote
• eSignatures
• Borrower Attribution
• Disclosures
• MERS eRegistry
• Registration within 1 Day of eClosing

10
eMortgage Guide Fannie Maes Requirements

• Procedures for MBS Deliveries and Document
  Custodian Support
• Servicing
• Payoffs
• Loss Mitigation

11
Our Experiences

• Significant Value Exists
• Borrower Acceptance
• Title Company and Closing Agent Participation and
  Acceptance

12
Whats Next?

• Broader Lender Adoption
• Electronic Recording of Closing Docs
• Further Collaboration With the Industry on
  Standards
• Further Collaboration With MERS and Lenders to
  Streamline Processes

13
Questions?

• Pam Holland
• Associate General Counsel
• Fannie Mae
• 301-270-2495
• Pamela_Holland_at_fanniemae.com