Statement by Terry Edwards, Executive Vice President of Fannie Mae, on Foreclosure Process Compliance

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Oct 01, 2010, 02:43 ET

WASHINGTON, Oct. 1 /PRNewswire-FirstCall/ -- We are disturbed by reports of servicers failing to follow proper procedures in the administration of foreclosure cases. We strongly believe that homeowners who have exhausted all other options and are now facing foreclosure must be treated fairly and equitably. Accordingly, servicers should adhere to the exact requirements of the law in all of these cases, including the proper execution of affidavits, verifications and other legal documents as part of the default process.

Fannie Mae servicers are required, by contract, to adhere to applicable laws and rules regarding mortgage documents, and to establish processes and controls that ensure compliance. The steps we are taking today in coordination with our regulator are meant to reinforce these contractual obligations, strengthen the regimen for review and due diligence on the part of servicers, and protect the rights of borrowers facing foreclosure.

Fannie Mae exists to expand affordable housing and bring global capital to local communities in order to serve the U.S. housing market. Fannie Mae has a federal charter and operates in America's secondary mortgage market to enhance the liquidity of the mortgage market by providing funds to mortgage bankers and other lenders so that they may lend to home buyers. Our job is to help those who house America.

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SOURCE Fannie Mae