Bulletin: NY000020

Date:
January 11, 1991
To:
All Underwritten Companies
RE:
Fannie Mae Balloon Mortgage Endorsement

Dear Associates:

Please be advised that the New York State Insurance Commissioner has approved for issuance a certain Fannie Mae Balloon Mortgage Endorsement which can be issued in accordance with the Fannie Mae developed Balloon Mortgage Program. Under this program, the borrower may exercise an option:

  • To execute a new note and Mortgage at a fixed rate of interest; or,
  • To execute a new Note in modification of the existing Mortgage at a fixed rate of interest.

Please find a copy of the FNMA Balloon Mortgage Endorsement through the reference section at the end of this bulletin. The endorsement is to be issued only under the following conditions:

  • The Mortgage contains the Fannie Mae Rider (for your convenience, a copy of same is attached hereto for your review); and,
  • The property is a one-to-four family residential property.

In addition, you may be required in the future to add language to the existing policy concerning the modification of the insured mortgage. Accordingly, the following affirmative language may be added at such time in the future:

  • Schedule "A" of the policy is hereby amended to reflect the recording of a Modification Agreement dated _______, _____, and recorded in Book _____, at page _____, of the records of _______ County, which Modification Date is the Maturity Date of the insured Mortgage to _______;
  • The Company hereby insures that the said Modification is valid and enforceable according to its terms and that the insured Mortgage, as modified, shares the same priority as the Mortgage originally insured by said policy; and,
  • In all other respects, the coverage under the above policy remains unchanged as of the effective date shown in the original policy.

In the event you have any questions concerning the above or if I can be of assistance with regard to same, please do not hesitate to contact me at your earliest convenience.

THIS BULLETIN IS FURNISHED TO INFORM YOU OF CURRENT DEVELOPMENTS. AS A REMINDER, YOU ARE CHARGED WITH KNOWLEDGE OF THE CONTENT ON VIRTUAL UNDERWRITER  AS IT EXISTS FROM TIME TO TIME AS IT APPLIES TO YOU, AS WELL AS ANY OTHER INSTRUCTIONS. OUR UNDERWRITING AGREEMENTS DO NOT AUTHORIZE OUR ISSUING AGENTS TO ENGAGE IN SETTLEMENTS OR CLOSINGS ON BEHALF OF STEWART TITLE GUARANTY COMPANY. THIS BULLETIN IS NOT INTENDED TO DIRECT YOUR ESCROW OR SETTLEMENT PRACTICES OR TO CHANGE PROVISIONS OF APPLICABLE UNDERWRITING AGREEMENTS. CONFIDENTIAL, PROPRIETARY, OR NONPUBLIC PERSONAL INFORMATION SHOULD NEVER BE SHARED OR DISSEMINATED EXCEPT AS ALLOWED BY LAW. IF APPLICABLE STATE LAW OR REGULATION IMPOSES ADDITIONAL REQUIREMENTS, YOU SHOULD CONTINUE TO COMPLY WITH THOSE REQUIREMENTS.

References

Bulletins Replaced:
None
Related Bulletins:
None
Underwriting Manual:
11.28 Loan Policies
Exceptions Manual:
None
Forms:
None