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Capped, Standardized Breakage Fees

March 2, 2015

Effective March 4, 2015, we are capping and standardizing breakage fees for all newly locked fixed-rate loans where a breakage fee applies.

We will continue to use the existing breakage formula; however, for all fixed-rate transactions with breakage fees, the breakage fees will be subject to a 0.5% minimum and 2% maximum of the rate-locked mortgage amount.

Previously, the breakage formula for some transactions may have resulted in fees above 2%. For floating-rate loans with breakage fees, we will continue to charge a flat 2% breakage fee. All lock resources mentioning the breakage fees will be updated and available on March 4 on the Products page, as well as the Originate and Underwrite and Originate and Underwrite – TAH Lender pages on Freddie Mac’s website.

For additional information, please contact your Freddie Mac Multifamily representative.

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