Servicing Guide

Published September 9, 2020

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How should termination of conventional mortgage insurance be finalized and reported?

The following table provides the requirements for finalizing and reporting the termination of the MI.

The servicer must...
 

Reduce the borrower’s mortgage loan payment by the amount that was being collected to pay the MIP within the required time frame, unless the MIP was financed as part of the mortgage loan amount.

 

Notify the borrower within 30 days after termination that the MI has been terminated and, if applicable, indicate no further escrow deposits for MI will be due from the borrower.

 

Forward any unearned MIP refund to the borrower as soon as it is received from the mortgage insurer, but no later than 45 days after the MI termination date.

 

Report the termination of MI to Fannie Mae with the next Fannie Mae investor reporting system reports it submits after the termination date. See Reporting Discontinuance of Mortgage Insurance in the Investor Reporting Manual for additional information.

For more information please see: B-8.1-04, Termination of Conventional Mortgage Insurance.

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