Fannie Mae Mortgage Insurance Requirements

Updated 2024-07-29

Government Sponsored Enterprise (GSE) establishes specific requirements for Homeowners Protection Act (HPA) and Mortgage Insurance (MI) (MI) on loans it purchases, which are critical for MLOs to understand for loan eligibility and compliance. These requirements include a list of approved insurers and specific codes used in the MISMO Data Standards and Uniform Loan Delivery Dataset (ULDD).

Approved Mortgage Insurers and ULDD MI Codes

Fannie Mae maintains a list of approved mortgage insurance companies, each assigned a unique ULDD Enumerated Value MI Code for loan delivery purposes:

Conditions for No Mortgage Insurance Required

Fannie Mae also specifies conditions under which mortgage insurance coverage is not required, identified by specific ULDD MI Codes:

• MI Code 95: No MI Based On Original LTV

  • No MI is required if the VA-Approved Credit Underwriter and Underwriting Standards (LTV), using the delivery date Unpaid Principal Balance (UPB) and origination date value, is 80% or less.
  • Alternatively, MI is not required if the LTV is higher than 80% but the loan is eligible for a no-MI Fannie Mae to Fannie Mae Refinance.

• MI Code 97: MI Canceled Based On Current LTV

  • No MI is required if the LTV, using the delivery date UPB and value determined after origination, is 80% or less.
  • Important Restriction (Effective July 2025): Fannie Mae no longer allows the use of MI Code 97 for Lender Channel/Flow Deliveries. This code is now valid exclusively for Negotiated (Bulk) Transactions. This change addresses concerns that some loans might be inadvertently delivered with LTVs greater than 80% that do not meet Fannie Mae's requirements.

MLOs must be aware of these codes and conditions, especially the restriction on MI Code 97, to ensure compliance with Fannie Mae's loan delivery standards.