A New and Improved Good Faith Deposit Process
July 5, 2017
We heard your feedback and simplified the early rate-lock (ERL) good faith deposit process. Now you will have easier access to the funds — giving you more flexibility at closing.
Effective as of Saturday, July 1, you are no longer required to submit good faith deposit funds to us. Instead, you may hold the funds. This change applies to all cash loans except Small Balance Loans.
What’s changing for cash good faith deposits?
- You will need to upload to Document Management System (DMS) a confirmation of your receipt of the good faith deposit from your Borrower within two business days of rate-lock.
- You may release the good faith deposit prior to the Freddie Mac funding date if certain requirements, as defined in the Guide, are met.
What’s changing for a letter of credit good faith deposit?
- With Freddie Mac’s approval, you may hold a letter of credit in lieu of holding cash for all or a portion of the good faith deposit. The letter of credit must be accompanied by an opinion of the issuer’s counsel and a Letter of Credit certification form. You will need to upload to DMS a confirmation of your receipt of such items within two business days of rate-lock.
For both the cash good faith deposit and a letter of credit good faith deposit, you must submit the application fee within two business days after rate-lock.
You can find all the details in the recent Guide Bulletin posted Thursday, June 29.