Freddie Mac Eliminating Cashiering Primary Servicer Rating Requirement Effective Immediately
March 28, 2012
As Freddie Mac continues to evolve our securitization platform, as well as strengthen our yearly audit process, we have made a conscious effort to streamline our processes and reduce the financial burden to our customers. As a result, beginning with our current K-Deal, K-501, we will no longer require Seller/Servicers who perform cashiering functions to maintain a primary servicer rating. This will also include the Freddie/Fitch rating that we have offered to those Seller/Servicers not wishing to obtain a full rating agency primary servicer rating.
For certain K-deals, the Pooling and Servicing Agreement (PSA) contained a provision permitting Seller/Servicers who obtained the Freddie/Fitch primary servicer rating to perform cashiering functions after the settlement of the deal only if the Freddie/Fitch primary servicer rating was maintained. We will be amending these PSAs to delete the ratings requirement entirely and it will not be necessary to retain the Freddie/Fitch, or any other, rating to continue to service these deals. However, these amendments will not permit the affected Seller/Servicers to perform cashiering functions on past deals that did not contain this Freddie/Fitch primary servicer rating provision.
Although we are eliminating the ratings requirement to perform cashiering functions in K-Deals, the Customer Compliance Management's (CCM) audit process will remain the same and will be performed on an annual basis.