Fannie Mae Guidelines for Private Road Maintenance Agreement

Fannie Mae Guidelines for Private Road Maintenance Agreement: What You Need to Know

If you are in the market for a home, you may have come across properties that are located on private roads. Private roads are defined as roads that are not maintained by the government and are the responsibility of the property owners who use them. If you are considering purchasing a property on a private road, you need to be aware of the Fannie Mae guidelines for private road maintenance agreement.

Fannie Mae is a government-sponsored enterprise that buys and sells mortgage loans. They have guidelines in place to ensure the loans they purchase meet certain standards. One of these standards is the private road maintenance agreement. A private road maintenance agreement is a legal document that outlines the responsibilities of each property owner for maintaining the private road.

Fannie Mae requires that all properties with access to a private road have a private road maintenance agreement in place. This agreement must be recorded with the local county or municipality and must include the following information:

1. A description of the private road – The agreement must include a description of the private road, including its location, width, and any specific features that make it unique.

2. Responsibilities for maintenance – The agreement must outline the responsibilities of each property owner for maintaining the private road. This includes routine maintenance such as grading, paving, and snow removal, as well as repairs and improvements.

3. Payment responsibilities – The agreement must also outline the payment responsibilities of each property owner for the cost of maintaining the private road. This may include a monthly or annual fee or a one-time assessment for major repairs or improvements.

4. Dispute resolution – The agreement should include a dispute resolution process in case there are disagreements about the private road`s maintenance or payment responsibilities.

Having a private road maintenance agreement in place not only satisfies Fannie Mae`s requirements but also helps to ensure the road`s proper upkeep. When a private road is well-maintained, it can improve the overall value of the properties that use it, making it easier to sell or refinance in the future.

It is essential to note that Fannie Mae has strict guidelines regarding private road maintenance agreements. If the agreement does not meet their requirements, they may not be willing to purchase the loan, making it challenging to secure financing for the property.

In summary, if you are considering purchasing a property on a private road, ensure that a private road maintenance agreement is in place and meets Fannie Mae guidelines. Doing so will not only satisfy the requirements but also ensure the road`s proper upkeep, which can improve the value of the property in the future.

Scroll to Top