Fannie Mae and Freddie Mac Each Announce Updates to the Uniform Instruments

In July 2021, Fannie Mae and Freddie Mac (the “GSEs”) each announced that their uniform instruments, which include their security instruments, notes, and riders, were updated. Except for those uniform instruments that are being retired, the updates impact all uniform instruments.

The updated uniform instruments have a tagline, dated July 2021, and may be used for all mortgage loans originated on or after July 8, 2021. However, mandatory use of the updated uniform instruments is required for all mortgage loans having a note date on and after the effective date of January 1, 2023.

As either the updated uniform instruments or their current versions may be used until January 1, 2023, the GSEs will make both versions available on their respective websites. The GSEs are providing an 18-month transition period to allow lenders and their vendors adequate time to prepare for the mandatory January 1, 2023 requirement.

While either the current or updated version of the uniform instruments may be used, note that an updated July 2021 uniform instrument, such as the multistate note, may not be combined with a current version of the uniform instrument, such as a security instrument.

Freddie Mac announced in its July, 2021 News & Updates and Bulletin 2021-25 that among the changes are revisions based on federal, State and local law changes as well as enhancements to simplify language. Freddie Mac also created new Exhibit 4A, List of Uniform Instruments, that includes the list of uniform instruments, and new Exhibit 5A, Authorized Changes for Notes, Riders and Security Instruments, which sets forth the authorized changes for these legal documents. These new Exhibits will complement Exhibits 4 and 5 (Exhibit 4 contains the current list of uniform instruments, and Exhibit 5 contains their authorized changes), which will both be retired after the mandatory effective date.

Fannie Mae, pursuant to Selling Guide Announcement (SEL-2021-06) (“Announcement”), announced updates to all of its uniform legal instrument – security instruments, notes, riders and addenda, and special-purpose documents. The Announcement advised that Fannie Mae and Freddie Mac collaborated to conduct “a comprehensive review of the instruments and made improvements to enhance their clarity and usability.” More information about the updated uniform instruments may be found in the Uniform Instruments Update Fact Sheet, which is posted to Fannie Mae’s webpage from which the updated uniform instruments may be accessed.

Please contact me at mfeliciano@garrishorn.com if you would like to discuss any of these issues.