Fannie Mae issued Lender Letter LL-2018-03, updating and streamlining the process for terminating conventional mortgage insurance (MI). The updated process relates to borrower-initiated requests for the termination of MI. Per the Lender Letter, Fannie Mae’s Automated Property Service (APS) may now be utilized for MI termination when the MI is based on the original value of the property (resulting in servicers no longer being required to warrant the property value). The Lender letter also permits the use of broker price opinions (through Fannie Mae’s Valuation Management System (VMS)) to verify the current property value, when the MI is based on the current value of the property. In addition, the Lender letter: revised the loan-to-value threshold used to determine MI eligibility for termination based on current value and property improvements; allows MI terminations to be evaluated based on a borrower’s verbal request only; incorporated into the Servicing Guide changes announced in Lender Letter LL-2017-0 (relating to the evaluation of a borrower request for termination of mortgage insurance following a disaster); and removed outdated original value termination requirements from the Servicing Guide. Servicers are required to implement the updated requirements by March 1, 2019. Servicers are, however, encouraged to implement the updated requirements as early as January 1, 2019 (provided the APS and VMS become available by such time).
Fannie Mae
Fannie Mae Issues Servicing Guide Announcement SVC-2024-06
Fannie Mae issued Servicing Guide Announcement SVC-2024-06 (Announcement), setting forth updates to the Servicing Guide. Per the Announcement, Fannie Mae clarified requirements related to eMortgages.
November 14, 2024
