MultiLender Swaps
The Benefits of a Swap, with Lower Minimum Requirements
Through our MultiLender Swap execution, you can trade your mortgages
for Freddie Mac securities. A
MultiLender Swap gives you a prorated share of a Freddie Mac PC. Your minimum commitment
amount is $1,000 with MultiLender Swap, allowing you to reap the
benefits of a Guarantor execution for only a few mortgages.
When you swap your loans for Freddie Mac securities through our MultiLender
Swap execution and sell them to a dealer, you can replenish your
funds and make more loans, maximizing your origination fee income
and increasing your servicing portfolio or your servicing-released
premium income.
Enhancements Announced March 24, 2004
As we announced with our March 24
Industry Letter [PDF 78K], we're enhancing our MultiLender Swap execution, starting
with programmatic changes today. Effective with MultiLender Swap PC Pools posted
April 1 for settlement on and after July 1, you'll swap conventional 15- and
30-year fixed-rate mortgages for Giant PCs instead of Gold PCs®, without a fee.
The Giant PC will be made up of Gold PCs backed by mortgages sold through both
our cash paths and the MultiLender Swap execution. With this change, we're creating
a capability that will be used to expand and enhance this execution by issuing
large, liquid, and more predictable securities.
You will continue to receive Gold PCs in exchange for:
- 20-year fixed-rate mortgages delivered for 20-year PC Pools (but a Giant PC if delivered into 30-year fixed-rate Giant PC Pools)
- 5- and 7-year balloon/reset mortgages
- FHA/VA, Section 184 Native American, and Section 502 Guaranteed Rural Housing mortgages
Beginning with MultiLender PC pools posted on April 1 for settlements on and after July 1, you will see the following changes:
- 15-year Giant PC pools will be identified with the "G1" PC prefix
- 30-year Giant PC pools will be identified with the "G0" PC prefix.
There are no changes to commitments, contract options, delivery requirements, pooling and settlement procedures, and no change to the Gold Rush funding option.
Lender Benefits
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MultiLender Swaps let
you exchange one or more loans for an equal dollar amount of
Freddie Mac securities, and allow you to choose Gold
Rush® funding at delivery, so you can settle at any time. |
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Just 45 days after a Gold
PC is issued, the investor receives the first payment. |
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Then in every month that
follows, the investor receives a payment just 14 days after
the borrower's scheduled principal and interest are due. The
obvious benefit of these features is that you can begin to receive
current return quickly and efficiently for re-investment. |
| In addition to speed,
several factors make the PC a standard: |
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Guaranteed timely payment of both
interest and scheduled principal |
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Immediate eligibility as collateral for GOLD
MACS®, REMICS, Giants, etc. |
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Settle on your PC whenever
you want-even overnight. Under the MultiLender Swap execution,
you can settle throughout the month, except for the last five
business days. |
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Gold Rush funding offers the fastest
swap execution in the business. With Gold Rush, you can deliver
your loans up to the day before settlement. |
For More Information
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