Fannie Mae: MI Termination Updates; Disaster Policy Reminder Lender Letter; and More
July 18, 2018
Source: Fannie Mae
Coming soon! New streamlined process for MI termination
Updated requirements for the termination of conventional mortgage insurance (MI) will simplify the process of evaluating borrower-initiated requests and result in a better customer experience for both servicers and borrowers. Servicers are encouraged to implement these changes as early as Jan. 1, 2019 (when Automated Property Service™ and the Valuation Management System become available); however, implementation is required by March 1, 2019.
Lender Letter LL-2018-04: Disaster Policy Reminders and Updates
Fannie Mae continues to support servicers with borrowers impacted by recent and future disasters, such as hurricanes and wildfires. Today, we published Lender Letter LL-2018-04: Disaster Policy Reminders and Updates, to remind servicers that:
- We will reimburse for inspections required to confirm repairs on properties with an insured loss event for both current and delinquent mortgage loans.
Note: For properties inspected after the date of this Lender Letter, we will increase the maximum reimbursement limit of insured loss repair inspections from $30 to $60.
- We will reimburse servicers up to our existing allowable reimbursement limits for the costs to inspect properties impacted by a disaster for both current and delinquent mortgage loans when necessary to determine the extent and nature of the damage.
- The Fannie Mae Extend Modification for Disaster Relief (Extend Mod) and hazard loss draft proceeds disbursement policies found in Lender Letter-2017-09 remain in effect until further notice.
Visit the Assistance in Disasters page for additional information and resources, including previous disaster-related Lender Letters, FAQs, and more.
HSSN job aid and SMDU updates for Extend Modification for Disaster Relief
On July 14, we released a HomeSaver Solutions™ Network (HSSN) update related to creating and submitting a closed loan modification case for Extend Modification for Disaster Relief. Together with a Servicing Management Default Underwriter™ (SMDU™) update on July 21, these updates introduce a simplified process that allows borrowers to enter $0.00 in the delinquent interest field, instead of using the $0.01 workaround. You are encouraged to implement the new process immediately; all active cases using the workaround will be adjusted Aug. 1. Use the revised HSSN job aid for detailed guidance on the update. Please direct any questions to your Fannie Mae Servicing Account Manager.
Enhancements to SMDU coming this weekend
This weekend, we will implement enhancements to SMDU. Please refer to the release notes for more information. SMDU will be unavailable to process transactions during implementation from 10 p.m. ET on Friday, July 20 until 11 a.m. ET on Saturday, July 21. If you have questions about this release, please contact your Fannie Mae Servicing Account Manager.
Changes to Servicers Loan Activity Reporting (LAR) coming soon!
To help simplify servicing, we’re introducing a change to the Transaction Type (Tran 83) payment recast process. Effective July 21, servicers will be able to report Loan Activity Report 96 (LAR 96) and Transaction Type 83 (Tran 83) with the changed principal and interest (P&I) constant in the same month. Review our detailed scenarios of how payment recasting will be simplified for Scheduled/Scheduled loans.
Join us at these upcoming events:
Aug. 5-8 | Lenders One Summer Conference | Salt Lake City
Aug. 19-21 The Mortgage Collaborative Summer Conference | Chicago
Sept. 8-11 | NAHREP National Convention | San Diego
View more events.
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