Fannie Mae 'Due on Sale' Exemption

2 Replies

Here is a link ( to Fannie Mae exemptions to "Due on Sale" clause that includes the following: 

transfer to a limited liability company (LLC), provided that:

  • -the mortgage loan was purchased or securitized by Fannie Mae on or after June 1, 2016, and

    -the LLC is controlled by the original borrower or the original borrower owns a majority interest in the LLC, and if the transfer results in a permitted change of occupancy type to an investment property, such change does not violate the security instrument (for example, the 12 month occupancy requirement for a principal residence).

  • Lots of discussion on here over the years about Due on Sale clauses and thought this might help.

Does a new servicer of a mortgage potentially impact this definition? (e.g., a mortgage is being refinanced with fannie mae and 6 months later it's sold to someone else and now we're paying this new bank our mortgage payments?)

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