Fannie Mae Guidance on Acceptance of Remote Online Notarization

March 24, 2020

To address several industry questions and concerns, Fannie Mae has issued a lender letter that provides information on various topics including electronic signature requirements and title insurance.

The letter refers lenders to Fannie Mae’s Seller Guide, which specifies that it accepts loans where documents have been electronically notarized, either in person or remotely using real-time, two-way audio/video communication. ALTA is working with the government sponsored entities to get more guidance about the types of remote online notarization transactions that will be accepted.

Fannie Mae’s guidance says:

Fannie Mae accepts delivery and servicing of loans with electronic documents, including security instruments or mortgage loan modification agreements that have been electronically notarized, either in person or remotely using real-time, two-way audio/video communication. Electronic notarizations (including remote notarizations) may be used with eMortgage transactions as well as ink-signed transactions.

According to Fannie Mae, loans must meet the following requirements:

  • The notarization is performed in accordance with and is legally valid under the laws and regulations of the state in which the notarization is performed, at the time it was performed; and
  • If the electronic notarization is a remote notarization, the following additional requirements must be met:
    • the notary public is licensed and physically located in the state where the notarial act occurred and, where required by law or regulation, is specifically licensed to perform electronic notarizations;
    • the laws and regulations of the state in which the mortgaged property is located either expressly permit the use of remote notarization (such as Virginia and Montana) or expressly accept remote notarizations performed out-of-state in accordance with the laws of the state in which the notarial act is performed;
    • the loan must be delivered with SFC 861;
    • the mortgage loan is not a Texas Section 50(a)(6) loan; and
    • if the notarized document is a security instrument or an amendment to a security instrument, the remote notarization must comply with the title requirements in B7-2-04, Special Title Insurance Coverage Considerations.

Regarding title insurance, Fannie Mae reminded lenders that it accepts lender’s policies written on the 2006 ALTA loan title insurance form or a local equivalent, which includes “gap coverage.”

The letter specifically says:

We understand that recording offices are closed in certain areas due to public health directives associated with COVID-19 and that such closures present challenges for lenders in complying with title requirements in Selling Guide Chapter B7-2. We are working to address these challenges, but in the meantime, we want to remind lenders that we accept lender’s policies of title insurance written on the 2006 ALTA loan title insurance form or a local equivalent. Covered Risk 14 in the 2006 ALTA form includes “gap coverage” for matters arising between the loan closing date and the mortgage recording date. We will accept this as long as there is no exception for this coverage under Schedule B of the policy.


Contact ALTA at 202-296-3671 or communications@alta.org.

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