Today Fannie Mae published an announcement that reminds lenders of their contractual obligations and responsibilities for ensuring that any mortgage insurance coverage Fannie Mae requires is maintained. This is not a change to Fannie Mae's policy pertaining to mortgage insurance coverage, but a reinforcement of an existing policy.
In addition, this Announcement provides new requirements for reporting notifications of mortgage insurance rescissions, mortgage insurer-initiated cancellations, and claim denials. It also confirms Fannie Mae's repurchase policies, required timelines and remedies relating to representation and warranty violations involving mortgage insurance coverage as well as representation and warranty violations involving Fannie Mae requirements generally.
The policy changes relating to the new reporting requirements included in this Announcement are effective for mortgage insurance notifications of rescissions, denials, and mortgage insurer-initiated cancellations dated on or after October 1, 2011.
Investors should consult the announcement for specific details pertaining to the new requirements.
Investors may also contact our Fixed-Income Securities Helpline at 1-800-BEST-MBS (1-800-237-8627) if they have additional questions.
Originally Published: June 30, 2011