New Guide Bulletin Published
April 30, 2015
Today we published a Guide Bulletin for the Freddie Mac Multifamily Seller/Servicer Guide on AllRegs®. We encourage you to read the complete Bulletin, found on our Guide Bulletins page, for full details.
Guide Bulletin Highlights
Highlights of changes featured in this Bulletin include:
- Including in the Guide the conditions under which Freddie Mac delegates to the Servicer the authority to calculate the prepayment amount and prepayment premium amount in connection with a full prepayment of a Mortgage;
- Making changes to our requirements for interest rate hedge agreements, including permitting the use of a percentage of the London Interbank Offered Rate (LIBOR) as the variable interest rate index for swaps or caps in lieu of SIFMA and specifying requirements for the calculation of payments for an interest rate swap;
- Revising our requirements for Priority Repairs and repair escrows, including a new requirement to identify the most urgent of Priority Repairs as PR-90 repairs on the property condition report;
- Revising our requirements for a Property’s electrical capacity and overload protection;
- For non-SBL Mortgages, revising our requirements for various third-party reports: the wood-damaging insect inspection report, the certification from a Property’s pest control provider, and the post-construction analysis report for a Forward Commitment;
- Revising our requirements for post-purchase reporting, including:
- Changing the threshold for biennial property inspections from $1 million to $2 million;
- Adding a new provision with respect to a Supplemental Mortgage authorizing the Servicer to provide the information to the servicer of any securitized senior Mortgage; and
- Requiring Servicers to provide details on inspections reports regarding repair agreement items, and clarifying the nature of follow-up required for risks identified during the inspection;
- Adding a clarification to our requirements for Property Improvement Alterations;
- Modifying references to our Lease-Up offerings to reflect more descriptive program names;
- Updating Exhibit 3 to reflect recent changes to the Breakage Fee formula;
- Revising our definition of “Securitization” to reflect that a loan may be assigned to a grantor trust;
- Clarifying requirements as to originating a Supplemental Mortgage; and
- Making revisions to various forms including:
For all mortgages except Small Balance Loans (SBLs), the changes regarding the identification of PR-90 repairs on Form 1105, Property Condition Assessment, go into effect for all assessments ordered on or after April 30. Freddie Mac will notify SBL Seller/Servicers when the changes regarding PR-90 repairs go into effect for SBLs.
The change in timing of the submission of post-purchase property inspection reports applies to the submission of Annual Inspection Forms (AIFs) and MBA Property Inspection Forms beginning in 2016.
All other revisions announced by this Bulletin are effective immediately.
Please contact your Multifamily regional representative with any Guide Bulletin questions.