Fannie Mae and Freddie Mac have introduced new uniform notes, security instruments and riders for use immediately, with a deadline for use of January 1, 2023.
The press release touts the benefits of the updated instruments as:
- Easier to use: Employ more headings and subheadings, shorter paragraphs and sentences, and more clearly defined lists.
- Provide more clarity: Use plainer language and clarify the explanation of borrower and lender obligations.
- Reflect industry changes: Account for the changes that the industry has experienced over time and better reflect current industry practices and systems.
Fannie and Freddie are providing an 18-month transition period to allow lenders and their vendors to prepare.
Dirt lawyers should review the new documents to determine whether changes are needed in how closing documents are explained to clients.
What do you think of the new documents?