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Best Efforts Commitment Option

Lock in competitive rates and reduce exposure to interest rate fluctuation

Freddie Mac's best efforts commitment option reduces your interest rate and pipeline risk, providing greater control over all your secondary market activities. Our best efforts commitment option allows you to lock in competitive prices for fixed-rate cash contracts that become mandatory only if the loan closes. For loans that don't close, despite your best efforts, you can cancel your lock without incurring a pair-off fee.

Use Freddie Mac's selling system to sell your individual fixed-rate loans, either servicing-released or servicing-retained, and both premium and discount mortgages are eligible as long as their note rates are at or below our posted maximum eligible coupon. You will receive premium prices for your premium mortgages and you can sell the entire mortgage yield (less your servicing spread) since there is no par cap.

Product Features

FeatureDescription
Eligible Mortgage Products
  • 15-, 20-, and 30- year fully amortizing fixed-rate mortgages
  • 40-year fixed-rate Home Possible Mortgages secured by 1-unit primary residences
  • 5- and 7-year balloon/reset mortgages
  • Refer to Freddie Mac's availability matrix for additional details on eligible products or Section 9.6 of your Single-Family Seller/Servicer Guide for more information on our best efforts commitment requirements
  • Super conforming mortgages are not eligible at this time
Loan Requirements
  • Loan substitution is not allowed
  • If certain loan characteristics change, you may need to modify the loan and re-price the contract using the prices in effect on the original contract date
  • If a loan closes, you must sell the loan to us under your original contract. You cannot take out another contract to re-price the loan
Contract Requirements
  • Freddie Mac considers a Seller's success rate, under prevailing market conditions, in closing mortgages that are allocated to best efforts contracts. A mortgage that fails to fund and close as specified in the best efforts contract may adversely affect a Seller's pricing for future best efforts contracts
  • If a best efforts contract expires or is withdrawn and is in the '"unfulfilled" contract status for less than 30 days, you may relock the original loan by extending the contract. The relock will be re-priced at the lower of:
    • The original accepted price minus an extension fee, or
    • The current market price
  • If a best efforts contract expires or is withdrawn and is in the "unfulfilled" contract status for more than 30 days, you may reactivate the original loan by extending the contract. The reactivation will be priced at the current market price
Settlement
  • View settlement statements in real time using Freddie Mac's selling system
  • Receive settlement twice a day, or choose mornings or afternoons
  • Get faster settlement often within the same day as certification (if certified by noon) provided the settlement designation is PM or both AM/PM

Key Benefits

  • Reduce exposure to interest rate fluctuations in the market
  • Sell either servicing-released or servicing-retained
  • Take advantage of net pricing, including postsettlement delivery fees, for quick, all-in pricing when using the servicing-released option
  • Receive premium prices for your premium mortgages and competitive prices for your current rate and discount mortgages
  • Get faster settlement, often within the same day as certification (if certified by noon)
  • Select contract delivery periods in one-day increments between 2 and 90 days
  • Monitor status of your contract pipeline at the contract-and loan-level

For More Information

The information found on this page is not a replacement or substitute for information found in the Single-Family Seller/Servicer Guide and/or the terms of your Master Agreement and/or Master Commitment.

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