What Every Investor Needs to Know About Fannie Mae’s New Multifamily Title & Closing Rules

By WWLT

Have you ever gotten to the final stretch of a multifamily loan, only to feel like the paperwork shifts beneath your feet? Title requirements change, funding rules adjust, and suddenly your “easy” closing starts to feel more like quicksand than solid ground. 

If you’re feeling that way lately, you’re not imagining it, because as of May 8, 2025, Fannie Mae has officially changed the game when it comes to how multifamily mortgage closings are handled. And if you’re a lender, investor, title professional, or developer, the impact could be bigger than you think.

This isn’t just about red tape. It’s about trust, transparency, and the shifting landscape of risk mitigation in multifamily real estate. So let’s walk through what’s new, why it matters, and how World Wide Land Transfer is helping clients stay one step ahead.

So, What Changed?

On May 8, 2025, Fannie Mae released a revised version of its Multifamily Selling and Servicing Guide (Form 4650). These updates introduced stricter standards around who can manage title, closing, and disbursement duties for Fannie-backed multifamily mortgage loans. This marks a significant policy shift, especially for lenders and title agents used to previous workflows.

Here’s a breakdown of what’s new:

1. Only Fannie-Approved Title Insurance Underwriters can issue policies.
2. Funding and escrow functions must be performed directly by the underwriter, unless the law requires a title agent.
3. Enhanced due diligence must be completed before closing.
4. Lenders must ensure strict alignment between closing documents and Fannie’s updated guide.

While these adjustments may seem procedural, the implications ripple through nearly every party involved in a multifamily deal.

Key Takeaways at a Glance

To help simplify this transition, here’s a quick table outlining the major updates:

Why These Changes Matter

Reducing Fraud Risk in a High-Stakes Market

At the heart of these new standards is a response to growing concerns about title-related fraud and fund misappropriation in the multifamily market. By shifting funding responsibilities from local title agents to nationally vetted underwriters, Fannie Mae is tightening control where it counts.

The goal is to help reduce human error, eliminate gaps in responsibility, and centralize authority with trusted players who are trained in compliance and risk management.

This doesn’t mean title agents are being sidelined. It simply places the more vulnerable parts of the transaction, namely money movement and final disbursement, into the hands of those with higher institutional oversight.

Transparency You Can Trace

Borrowers, lenders, underwriters, and regulators all benefit from a clear paper trail that can be followed from application through closing. Fannie’s new approach ensures that closing documents match submission requirements and that all players are on the same page.

For borrowers, that means less confusion around what needs to be signed, submitted, or explained. For lenders, it increases confidence that the title process won’t derail loan approval. And for title professionals, it raises the bar but also elevates industry trust.

A New Rhythm for Title Agents

Under the new rules, title agents may no longer be authorized to disburse funds unless required by state law. This requires many agencies to restructure their operational flow and lean more heavily on their underwriter partners.

At World Wide Land Transfer, we’re already aligned with these new standards. We work with Fannie-approved underwriters and have built internal systems that accommodate their escrow roles while still delivering personal service to borrowers and lenders.

Lenders Must Level-Up

Perhaps the biggest operational shift falls on lenders, who now must:

1. Collect more documentation in the pre-closing phase
2. Vet borrower organizational records
3. Verify chain of title and transfer history
4. Ensure compliance with new funding instructions

It’s not just an influx of new paperwork. It’s a structural change in how lenders work with title companies. Chiefly, proactive coordination is now non-negotiable, lender’s title insurance is critical and partnerships matter more than ever.

How World Wide Land Transfer Supports Clients Under the New Rules

As a nationally trusted title partner, World Wide Land Transfer is uniquely positioned to help lenders, investors, and developers navigate these evolving standards.

Here’s how we help:

1. Direct Coordination with Approved Underwriters: We maintain strong relationships with Fannie-approved underwriters, ensuring your loan doesn’t hit a snag due to policy restrictions.
2. Pre-Closing Checklists: Our team builds custom due diligence checklists to help lenders and borrowers gather documentation efficiently and completely.
3. Escrow Support that Meets the Rules: We guide you through funding functions without overstepping Fannie Mae’s new lines of responsibility.
4. Educational Support: Whether it’s a phone call or a document review, we’re here to explain the “why” behind every change.

In short, we help your deal keep moving forward, compliantly and confidently.

Preparing Your Internal Team for a Smoother Process

As rules evolve, so should your internal workflows. That means everyone involved in the deal from loan officers and analysts to attorneys and investors, needs to be briefed on what’s new and what’s expected. The earlier these conversations happen, the less likely your deal is to stall during final underwriting.

For example, don’t wait until the last week before closing to begin gathering detailed organizational documents. Have a system in place to track entity structures, signatory authority, and title vesting info from the start. This isn’t just about satisfying compliance checkboxes. It’s about giving your team the tools to operate confidently within a more rigid framework.

Our team works closely with clients to establish checklists, timelines, and clear deliverables that help their staff get up to speed quickly. We believe that education and coordination reduce costly mistakes. That’s why we take the time to ensure every stakeholder is in sync from the beginning.

Industry Context: Why This Matters Now

Fannie Mae’s latest updates didn’t happen in a vacuum. In recent years, there’s been growing scrutiny around multifamily lending, with headlines pointing to improper borrower disclosures, fraudulent title claims, and cash flow misrepresentation.

Coupled with increased pressure from federal regulators, Fannie Mae and Freddie Mac have begun tightening their internal policies. This includes stronger verification processes for both borrower qualifications and transactional transparency.

The title industry, as represented by organizations like ALTA (American Land Title Association), has been in conversation with Fannie Mae throughout this transition. These groups are working to ensure operational feasibility while maintaining strong fraud prevention practices.

What You Should Do Next

If you’re a lender, developer, or borrower preparing for a Fannie-backed multifamily loan, here’s what you can do now to stay ahead of the curve:

• Verify Your Title Company’s Underwriter Status: Ensure they work with underwriters listed on Fannie’s approved schedule.
• Ask About Escrow Procedures: Know whether your title partner can perform funding tasks or if the underwriter must take over.
• Prepare Early: Gather borrower organizational documents, property histories, and chain of title records before final underwriting.
• Partner Smart: Work with a title agency like World Wide Land Transfer that already has these standards integrated into their process.

Beyond Compliance: Building a Foundation of Long-Term Trust

It’s easy to treat these changes as another hurdle to jump over before getting back to business. But the truth is, this shift presents an opportunity. An opportunity to build long-term trust with your closing team, your underwriter, and your borrower. In an industry where deadlines are tight and margins are thinner than ever, relationships built on accountability and follow-through make all the difference.

When closings are rushed or unclear, stress spreads across the entire deal. Delays, miscommunications, and last-minute issues can send deals into disarray. But when your title team is proactive, compliant, and aligned with your objectives, you don’t just meet expectations. You exceed them.

At World Wide Land Transfer, we don’t believe in cutting corners or applying generic solutions. We take the time to understand the full scope of your multifamily project, offering not just compliance, but clarity. And in an environment shaped by new rules and rising expectations, that clarity has never been more valuable. From land title insurance to title and escrow, we handle it all. 

A New Era of Trust in Title

At first glance, these changes might feel like more red tape. But zoom out, and they represent a maturing market. It’s one that values security, accountability, and lasting trust.

Whether you’re managing your first multifamily project or your fiftieth, the title and closing process shouldn’t be something you fear. With the right team in place, it becomes a seamless part of a larger, smarter investment strategy.

World Wide Land Transfer is here to help you adapt, comply, and thrive. Let us show you how thoughtful coordination, transparent communication, and national title expertise can make all the difference.

Still Have Questions? Let’s Talk.

Want to learn more about how these changes might impact your next multifamily deal? Reach out to the team at World Wide Land Transfer. We’ll walk you through the new Fannie Mae guidelines and help you close with confidence, each and every time.