Mortgage loan servicers and lenders use this transaction set to communicate the default status of mortgage loans to investors, regulators, or other authorized parties. Typically sent in response to inquiries or on a scheduled reporting basis, it provides detailed information about loans in default or at risk of default. The BGN (Beginning Segment) establishes the transaction context and purpose, the MIS (Mortgagee Information Status) segment conveys overall mortgagee status information, and the LX (Assigned Number) segment begins each loan record within the transmission, allowing multiple loans to be reported in a single document.

For example, a mortgage servicer such as Fidelity National Information Services might send a 264 transaction to its investor client, Fannie Mae, reporting on loans originated by ABC Mortgage Company that have fallen into default. For each loan, the servicer includes key details through the nested loops: the borrower’s name and address (via the N1 Loop), critical dates like when the loan entered default and property condition assessment dates (via the DTP Loop), the property address and condition status (via the REC Loop), outstanding balances and interest amounts (via AMT and INT segments), and current mortgage status and borrower communication attempts (via SOM and MRC segments). This structured format enables Fannie Mae to efficiently track and manage its portfolio of at-risk loans.