Fannie Mae Issues Lowered Loan Modification Interest Rate

Last month, Fannie Mae lowered the Modification Interest Rate based on an evaluation of prevailing market rates.  This adjustment has lowered the interest rate from 2.875% as of November 16, 2020, to the current rate of 2.750% as of January 15, 2021.  Servicers must be mindful of this modification as they are required to use this interest rate when “evaluating a borrower for a conventional mortgage loan modification.” Fannie Mae’s Interest Rate Exhibit provides the prevailing loan modification interest rates dating back to September 15, 2017.