Fannie Mae’s artificial intelligence and machine-learning governance requirements take effect Thursday, Aug. 6, giving approved seller/servicers a final deadline to formalize how the technology is used across mortgage origination and servicing. The requirements apply when a seller/servicer uses AI or machine learning in connection with loans sold to or guaranteed by Fannie Mae or loans serviced on its behalf, covering internally operated systems as well as AI used by vendors and subcontractors. Fannie Mae established the framework in a letter published April 8 with an effective date 120 days later. The lender letter requires seller/servicers to maintain policies and procedures governing the development, implementation, use, and maintenance of AI and machine-learning systems, addressing risk management, applicable laws, trustworthy and ethical use, employee communication, and responsibility for reviewing the program at least annually. Companies must also manage vendor and subcontractor AI under protections no less stringent than those applied to their own systems. The requirements fall on Fannie Mae seller/servicers, not individual loan originators, but could directly affect which AI tools LOs are permitted to use and how borrower information is handled. Fannie Mae may request prompt disclosure of the types of AI or machine learning a seller/servicer uses, how the systems are used, their purpose, and safeguards in place. Freddie Mac’s separate, more detailed AI and machine-learning governance requirements have been in effect since March 3. The Aug. 6 deadline does