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~FannieMae14221 Dallas ParkwaySuite 1000Dallas, TX 75254

June 18, 20110

JPMorgan Chase & Co.270 Park Avenue, 33 rd FloorNew York, NY 10017ATIEiNTION:: David Schneider

Fannie Ma.e Servioer#'s: 10647;13123; .21953; 10111; 21430; 1.2,669;21754

Re: Foreclosure Delays

Dear Mr. Schneider:

In order to address delays in the processing of Fannie Mae foreclosures, Fannie Ma.e isreminding servicers of existing Servicing Guide requirements and imposing certain newrequirements (collectively, the "Requirements"). Fannie Mae is also alertingl servicers thatFannie Mae may assess oompensatory fees pursuant to the Servicing Guide to compensateFannie Mae for unauthorized delaysof foreclosures and may require the repurchase of loanswith title defects that cannot be corrected within 90 days.

Terms and Effective Date

The IRequirementsare set forth on Exhibit A.

The Requirements wil'l apply to mortgage loans Fannie Mae owns or guarantees that are

serviced by JPMorgan Chase & Co. effective as set forth below.

Para.graphs 1, 4(e), 5,6,7, 8, and 9 of Exhibit A are either already effective under the existingServicing Guide or willi become effective on July 1, .2010.

The Requirements set forth in Para.graph 4(d) of Exhibit A regarding special rules and approvalrequirements for delays of Florida foreclosures after judgment has been entered are effectiveJuly 1, 2010 with respect to placing cases on hold and, with respect to continuing, postponing,or cancelling sales, are effective for sales scheduled to occur on or after July 15,.2010.

The Requirements set forth in Paragraph 4(c) of Exhibit.A regarding special rules and approvalrequirements for delays of scheduled Florida summary judgment hearings are effective with

respect to hearings scheduled to,occur on or after July 15, 2010.

The Requirements set forth in Paragraph 3 of Exhibit A regarding special' rules and approvalrequirements for delays of loans that are 12 or more months delinquent are effective as follows:

a. For loans that are 1'2or more months delinquent as of Juily 1, 20110,the Requirementsare effective on July 1, 2010, provided that the requirements for approvals with respectto scheduled sales will apply to sales scheduled to occur on or after July 15, 2010.,

b. For loans that become 12 months deUnquent after July 1, 2010, the Requirements will beeffective on August 1, 2010, provided that the requirements for approvals with respect toscheduled sales will apply to sales scheduled to occur on or after August 15, 2010.

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JPMorgan Chase & .Co.Re: Foreclosure DelaysPage 2

The Requirements contained in Paragraphs .2 , 4(a), and 4(b) will be effective September 1 :,2010.

Although certain of the approval requirements are not etlectiv,e immediate.ly, Fannie Mae urgesyou to begin more closeliy managling delays in the processing of our foreclosure cases as soonas possible.

We also want to remind you of your obli.gation to insure that any subservieers or other partiesyou retain to assist you with the performance of your servicing obligations service ourmortg'ages in accordance with alii Fannie Mae requirements.

Guides and Announcements

The instructions contained in this letter and Exhibit A are provided by Fannie Ma.e pursuant to

the terms of the existing Mortgage Selling and Servicing Contract between Fannie Mae andServicer.. Except as provided in Exhibit A, nothing herein should be construed asamending,revis.ing or limiting your authority or obligations under the Fannie Mae Mortgage Se:l'linglandServicing Contract, the Fannie Mae Guides or other a.g!reementswith Fannie Ma.e (collectively,the"Fannie Mae Guidelines"). Servicer should establish and/or ma,intain such qua.lity controlactivities, as Servicer deems necessary to monitor its compliance with the Fannie MaeGuidelines, the Requirements, and applicable law.

Confidentiality

You must keep the contents of this letter and the Requirements confidenUal; provided that youmay disclose them: (i) to your directors, officers, employees and agents with a legitima.te

business need to know; (iii)where disclosure is made pursuant to (a) any state or federal law orregulation., or (b) the order of any state or federal court or agency; or (iii) as otherwise a.greed toby both you and Fannie Mae.

We will be reaching out to you within the next few days to discuss the Requirements and toaddress any questions you may have.

~~----~Javid Jaben .Vice President, Servicing Portfolio, Management

cc: Bob Hera, Fannie MaeJerry McCoy, Fannie Mae

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Exhibit A - The Requirements

Fannie Mae is suffering delays in the processing of its foreclosures. In order to address these delaysand to more closely manage the foreclosure process, Fannie Mae is reminding servicers of existingServicing Guide requirements and imposing new requirements (collectively, the "Requirements") asfollows:

1. Documents Delays. The Servicing Guide requires that servicers provide attorneys/trusteeswith a complete foreclosure referral package and provide any missing documents within threeto five business days of request depending upon when the request is made. Fannie Mae expectsservicers and foreclosure attorneys/trustees to engage in a regular process of reconciliation withrespect to missing documents needed to conduct foreclosures .. In order to facilitate thisreconciliation process, Fannie Mae retained attorneys will produce a report twice a month atis-day intervals identifying foreclosures that are on hold due to missing documents. I If aservicer's foreclosures exhibit a continued pattern of delays fOI" document issues, Fannie Maereserves the right to assess the servicer compensatory fees for foreclosure delays caused bydocuments not timely provided.

2. Breach Letters and Referrals to Foreclosure. When a servicer believes a property has beenabandoned or the borrower has displayed an obvious lack of concern for the mortgageobligetion, the servicer must send the breach letter on a delinquent loan at the earliest possibledate allowed by law. Servicers must expedite foreclosure proceedings to the greatest extentallowable under applicable law (withoutexploring all foreclosure prevention options) if theproperty has been abandoned or vacated by the borrower and it is apparent that the bon-owerdoes not intend to make the mortgage payments. In all other cases, the servicer must send thebreach letter by the 45 lh day of delinquency, but may postpone sending it to no later than the62nd day of delinquency if the borrower has indicated a desire to pursue a foreclosureprevention alternative and the servicer reasonably determines the delay may facilitate aforeclosure prevention solution. However, if the Servicing Guide establishes any differentrequirements for government insured or guaranteed loans, then that guidance will apply instead.

Fannie Mae's prior written approval is required on any delay in referring a loan to foreclosurepast th e lOSth day of delinquency unless one of the following conditions exists (a "PermittedException") and is documented in the servicers system:

a. a legal impediment exists, such as the automatic stay in bankruptcy, a temporaryrestraining order or other injunction, mediation which requires a delay, or other issueunder applicable law;

b. the borrower has tendered funds sufficient to reinstate the loan;

c. the borrower has tendered the first installment due under a repayment plan;d. the borrower has submitted the first installment due under a trial modification or a

permanent modification and has signed and returned the required documents;e. a short sale has been approved by the servicer, the mortgage insurance carrier (if

applicable), and any junior lienholders, a closing is scheduled within the next 30 days,and the servicer has received satisfactory evidence that the buyer has been approved forfinancing or otherwise has funds to close the transaction; or

1Fannie Mae wiU also obtain missing document reports from some or all of the foreclosure trustees covering the WesternStates. including Arizona, California, Nevada, and Washington.

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f. a delay, postponement, continuance, or cancellation is required under Fannie Mae'sHAMP/HAFA guidance.

Fannie Mae reserves the right to assess the servicer compensatory fees for unauthorized delaysof foreclosure referrals.

1.. Loans 12 or More Months Delinquent. With respect to loans 12o r more months delinquent(as measured by last paid installment "LPI"), servicers may not place the loans on hold,continue, postpone, or cancel a scheduled summary judgment hearing or sale, or otherwisedelay the foreclosure process without Fannie Mae's prior written approval. unless:

a. a legal impediment exists and is documented in the servicer's system, such as theautomatic stay in bankruptcy, a temporary restraining order or other injunction,mediation which requires a delay, or other issue under applicable law.

b. the borrower has tendered funds sufficient to reinstate the loan;c. the bon-ewer has submitted the first installment due under a trial modification or a

permanent modification and has signed and returned the required documents; ord. a short sale has been approved by the servicer, the mortgage insurance carrier (if

applicable), and any junior lienholders, a closing is scheduled within the next 30 days,and the servicer has received satisfactory evidence that the buyer has been approved forfinancing or otherwise has funds to close the transaction.

Every loan that is 12 or more months delinquent as of July 1,2010 must be released from holdwithin 30 days ofJuly 1,2010 unless a "Permitted Exception" exists (as defined in Paragraph 2above) or Fannie Mae's written approval is obtained prior to the expiration of the 3D-dayperiod,

Fannie Mae expects that all of Fannie Mae's HAMP requirements will already have beensatisfied with respect to leans 12 or more months delinquent. If the servicer believes it isrequired to delay foreclosure for HAMP (or that it is advisable to de so), it must obtain FannieMae's prior written approval. Fannie Mae reserves the right to assess the servicercompensatory fees fer unauthorized delays of foreclosure with respect to loans 12 or moremonths delinquent, including any delays caused by the servicer's failure to timely solicit theborrower fer RAMP in accordance with Fannie Mae's existing HAMP guidelines.

4. Loans Less than 12 Months Delinquent. With respect to loans less than 12 monthsdelinquent (as measured by LPI):

a. Loss Mitigation Holds. Once a loan has been referred to foreclosure, servicers areallowed only one loss mitigation hold up to 42 days, provided that the hold may not

result in the continuance, postponement, or cancellation of a scheduled foreclosure salein a judicial foreclosure state. Loans must not be put on held en a blanket basis; ratheran individualized analysis must be done of each case to insure that it is necessary andappropriate to impose a hold in connection with a potentially viable workout and goodfaith efforts of the borrower, Putting l.oan5en held to de borrower outreach that wasotherwise required to be done earlier is net an acceptable reason to place a loan on hold.Unless a Permitted Exception (as defined in Paragraph 2 above) exists and isdocumented in the servicer's system, Fannie Mae's prior written approval is requiredfor (a) any less mitigation held in excess of 42 days, (b) any second hold for lossmitigation, or (c) any less mitigation holdthat will continue, postpone, or cancel a

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scheduled foreclosure sale in a judicial foreclosure state. Fannie Mae reserves the rightto assess the servicer compensatory fees for unauthorized loss mitigation delays,

b. Sale Contlnuances.Postponements, or Cancellations. Fannie Mae's prior writtenapproval is required for any continuance, postponement, or cancellation of a foreclosuresale unless (i) a the continuance, postponement, or cancellation is permitted underParagraph 4(a) above Of (ii) a Permitted Exception (as defined in Paragraph 2 above)exists and is documented in the servicer's system. Fannie Mae expects that there willbe very few continuances, postponements, or cancellations of sales that do not meet oneof the two exceptions, Fannie Mae reserves the right to assess the servicercompensatory fees for unauthorized delays of foreclosure sales.

c. Special Rules for Florida Summary Judgment Hearings. If a summary judgmenthearing has been scheduled in Florida, the hearing may not be continued, postponed, orcancelled without Fannie Mae's prior written approval unless a Permitted Exception (asdefined in Paragraph 2 above) exists and is documented in the servicer's system.Fannie Mae reserves the right to assess the servicer compensatory fees for unauthorizeddelays of Florida summary judgment hearings,

d. Special Rules for Florida Foreclosures after Judgment is Entered. Once judgmenthas been entered in a Florida foreclosure action, Fannie Mae's prior written approval isrequired to place the case on hold, continue, postpone, or cancel a scheduled sale unless(i) a legal impediment exists, such as the automatic stay in bankruptcy, a temporaryrestraining order or other injunction, mediation which requires a delay, or other issueunder applicable law, and is documented in the servicer's system or (ii) the borrowerhas submitted the first installment due under a trial. modification or a permanentmodification and has signed and returned the required documents.

e. Cases on Hold as of July 1, 2010. Every loan that has been on hold for 42 or moredays as of July 1,20.10 must be released from hold within 45 days of July 1,2010unless a "Permitted Exception" exists (as defined in Paragraph 2 above) or FannieMae's written approval is obtained prior to the expiration of the 45-day period.

5. Restrictions .onLaw Firm File Transfers. Fannie Mae's prior written approval is requiredprior to the transfer of any files from one law firm to another. Fannie Mae reserves the right toassess compensatory fees for delays caused by unauthorized file transfers and to denyreimbursement of fees and expenses with respect to loans that are the subject of unauthorizedfile transfers. Requests for authority to transfer files may be sent via-mail tor'etained attorney@fanniemae.co.l11.

6. Fannie Mae Approval for Delays, Holds, Postponements, Continuances, or Cancellations.In order to obtain Fannie Mae's prior written approval where required for any of the items inParagraphs 2,3,4, or 7, servicers must send their request and recommendation containing thefollowing information to Fannie Mae:

a. For delays of referral of cases to foreclosure, the basis for the requested delay, includingthe specifics with respect to the status of any loss mitigation efforts, and the requestedlength of the delay.

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h. For delays that do not involve the postponement, continuance. or cancellation of a sale,the basis for the requested delay, including the specifics with respect to the status of anyloss mitigation efforts, and the requested length of the delay.

c. For any delays that would continue, postpone, or cancel a sale:

the foreclosure sale date; the requested length of the delay; the next available sale date if the delay is approved; the basis for the requested delay, including the specifics with respect to the

status of any loss mitigation efforts;

date of last borrowercontact; and whether the servicer has received a complete loss mitigation package for review.

d. For any delays of a case that is more than 12-months delinquent (as measured by LPI)..in addition to any other information required, the request must include a certification bya senior representative of the servicer acceptable to Fannie Mae that he or she haspersonally reviewed the matter and believes that the delay is necessary or appropriateunder the circumstances.

This required information must be sent to Fannie Mae in an Excel Spreadsheet in the formatattached hereto via e-mail todelay_request@fanniemae.com. If the request relates to ascheduled foreclosure sale, the request must be received five business days before the schedulesale (or 15 business days before sale if the request relates to a scheduled foreclosure sale inFlorida) .. In addition, the cutoff for requests relating to sales on the first Tuesday of the monthis 10:00 eastern time on the fifth business day prior to the first Tuesday of the month. FannieMae will attempt to respond to the requests within 72 hOUIS, but in any event will respond atleast 48 hour before any scheduled sales. In the case of requests relating to scheduledforeclosure sales, if Fannie Mae does not respond at least 48 hours before the scheduled sale,the servicer may proceed based on its recommendation.

If a servicer becomes aware for the first time of a need to continue a sale less than five businessdays prior to the saJe (or less than 15 business days prior to the sale in Florida), it may seekFannie Mae's approval by the same method. Fannie Mae will prioritize the requests receivedbased upon the upcoming sale dates and will make every effort to immediately respond to suchrequests, If Fannie Mae does not timely respond, the servicer may undertake the delay, butmay be assessed a compensatory fee based upon Fannie Mae's later review of the case.

7,. Title Defects. With respect to each first lien mortgage sold to Fannie Mae, the followingwarranties, among others, are made to Fannie Mae: (a) that the mortgage is a valid andsubsisting lien on the property, (b) that the property i.s free and dear of 3 1 1 1encumbrances andliens having priority over it except for liens for real estate taxes, and liens for specialassessments, that are not yet due and payable, and (c) that the mortgage and any securityagreements, chattel mortgages, or equivalent documents relating to it have been properlysigned, are valid and their terms may be enforced by us. If loans referred to foreclosure cannotproceed because of tide defects, (a) the servicer must notify Fannie Mae of the issue and obtainFannie Mae's prior written approval for the delay and (b) Fannie Mae reserves the right torequire repurchase of such loans if the defects cannot be cured within 90 days of the attorney'sdiscovery of the defects or, at Fannie Mae's option, to assess compensatory fees for the delay

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caused by the title defects .. Delays by title insurance companies in processing and resolvingclaims, or disputes with title insurance companies over coverage issues, will not excuse aservicer from its repurchase obligations or prevent the imposition of compensatory fees.

8. Bidding Instruction Delays. Servicers must provide bidding instructions to the foreclosureattorney or trustee at least five business days before the scheduled sale. Fannie Mae reservesthe right to assess the servicer compensatory fees for delays caused by the failure to timelyprovide the foreclosure attorney or trustee with bidding instructions.

9 .. Compensatory Fees, Any compensatory fee we impose will be based on the outstandingprincipal balance of th e mortgage, the applicable pass-through rate, the length of the delay(s),and any additional costs that are directly attributable to the delayis) or as may otherwise beprovided in the Servicing Guide.

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Column Format

Date Requested Dale - MM/DDIVY

FNMA LIN# Text

SERVICE.R LN# Text

Servicer lName Text

Property Stat,e Use Drop Down Options

UPB I Currency - $000,000.00

I LAST PAID INSTALLMENT D.ATE Date - MMlDDIYV

NEXT DUE DATE Date - MM/DDIVVMonths Del~nque!'lt (Auto

Calculated) Do not completeCURRENT FORECLOSURE SALE

DATE (if applicable) Date - MMiDDIVV

Request Type Use Drop Down Options

I Delay Request Good Thru Date Date - MM/DDIVY

I

Projected NexJ AvailableForeclosure Sale Date (if

applicable) Date - MM/DDIVYI

The basis for the requesteddelay, including the specifics

with respect to the status of anyloss mitigation ef-tofts. Free form text

I

If requested delay i f for HAMPI(loans 12 or more months

delinquent or Florida Forceclosure:after ju.dgment entered), specify Iprior sollcitati~n efforts and why I'

delay ts required Free form textIf mis request is in regards to I:

Loss Mitigation, have youreceived a complete Loss

Mitigalion Package? Use Drop Down Options

Date of La.st Borrower Contact Date- MM/DOIYY

Senior Servicer Representa,tiveWho has Reviewed Request (ifloan is greater t~an 12 months

delinquent) NameTitle of Reviewer (if loan isgreater than 12 months

delinquent) Use Drop Down Options

Confidential - Internal Distribution