Understanding Fannie Mae’s Updated Title and Closing Requirements for Multifamily Mortgage Loans
In recent years, multifamily mortgage lenders participating in federally backed programs have faced growing exposure to operational and transactional risks. As deal volume surged and lending timelines tightened, many lenders relied heavily on third-party partners for escrow, funding, and title services, sometimes without full visibility into processes or documentation.
This lack of oversight, coupled with increasingly sophisticated forms of fraud and evolving regulatory scrutiny, has heightened the risk profile for lenders across the board. Discrepancies in how funds are collected, disbursed and recorded can lead to compliance gaps, reputational damage or financial loss.
As the market normalizes and federal agencies like Fannie Mae reinforce their standards, lenders are being called to reassess internal procedures and ensure their partners adhere to updated protocols. Strengthening controls now is not just a regulatory response, it’s a strategic opportunity to build more resilient and transparent multifamily lending operations for the future.
As part of its ongoing commitment to protecting Delegated Underwriting and Servicing (DUS) lenders from fraud and related risks, Fannie Mae has issued an updated version of Form 4650. These changes apply to multifamily DUS mortgage loans under application on or after May 8, 2025, and bring increased clarity and rigor to title and closing protocols.
Virtual Underwriter’s latest bulletin is a concise yet thorough overview of the new requirements, shedding light on what they mean for lenders and especially for title agents supporting multifamily transactions.
Key Questions for Title Agents and Lenders
Fannie Mae’s enhanced standards underscore a more proactive approach to fraud prevention and borrower transparency. While these protocols are intended to strengthen underwriting quality and long-term loan performance, they will also require significant operational adjustments. This raises important questions for title professionals, including:
- What specific changes have been made to Form 4650, and how do they affect funding responsibilities?
- How does Fannie Mae define “funding functions,” and what are the compliance requirements?
- In what ways should DUS lenders adjust their operations, manage cost implications, and refine strategic approaches?
- How can Stewart help support title agents navigating these changes?
Next Steps for DUS Lenders and Title Professionals
The first step in responding to these new requirements is gaining a solid understanding of Fannie Mae’s updated procedures. Stewart is ready to assist our title agents and lender partners with expert guidance on the evolving landscape of multifamily escrow and funding.
Through our Stewart Agency Escrow Services and dedicated DUS multifamily solutions team, we offer insights and practical support to help you align with Fannie Mae’s requirements and strengthen your strategic planning for the future. For support, please feel free to contact:
- Your local agency services representative
- Virtualunderwriter.com for the latest developments in underwriting. If you are a Stewart Trusted Provider™, contact your Stewart underwriting counsel with questions.
- Stewart’s Agency Escrow Services at: 866.932.6097 (or email at stgescrowservices@stewart.com)
- Stewart’s Fannie Mae DUS multifamily solutions team at: FanniemultifamilyDUSquestions@stewart.com
- Fannie Mae’s phone number: 800.2.FANNIE (800.232.6643, press 2 for DUS related inquiries)
- For online viewing of Stewart’s recently published bulletin related to this article, please visit SLS2025005.
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