F-1-02, Escrow, Taxes, Assessments, and Insurance (12/20/2023)

The servicer must provide instructions as required for an MI company to release information to Fannie Mae in accordance with  B-8.1-01, Conventional Mortgage Insurance Servicer ResponsibilitiesB-8.1-01, Conventional Mortgage Insurance Servicer Responsibilities.

The following table provides steps the servicer must follow when instructing the MI company to release details to Fannie Mae.

The servicer must notify Fannie Mae of MI rescissions, claim denials, or cancellations for all mortgage loans in accordance with  B-8.1-01, Conventional Mortgage Insurance Servicer ResponsibilitiesB-8.1-01, Conventional Mortgage Insurance Servicer Responsibilities.

The following table provides steps the servicer must follow for notifying Fannie Mae of MI rescissions, claim denials, or cancellations.

Note: Notification for active and liquidated mortgage loans must include the Fannie Mae and servicer loan numbers and a description of the rescission, mortgage insurer-initiated cancellation, or claim denial.

The servicer must cancel borrower-purchased MI at the request of the borrower in accordance with Borrower-Initiated Termination of Conventional Mortgage Insurance Based on Original Value of the Property or Borrower-Initiated Termination of Conventional Mortgage Insurance Based on Current Value of the Property, as applicable in  B-8.1-04, Termination of Conventional Mortgage InsuranceB-8.1-04, Termination of Conventional Mortgage Insurance.

On one-unit properties, the servicer must order an interior and exterior BPO, or appraisal if the servicer determines it is required by law, using Fannie Mae's servicing solutions system. On two- to four- unit properties, the servicer must order an interior and exterior appraisal using Fannie Mae's servicing solutions system.

The BPO or appraisal to determine the current value of the property is at the expense of the borrower and the servicer must only order the valuation after the servicer receives the applicable fee. The borrower must be charged the cost of the BPO or appraisal based on the following table.

If the borrower is requesting MI termination based on current value of the property because of property improvements made by the borrower since origination, the servicer must include details provided by the borrower of the property improvements to Fannie Mae.