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New Weights and Exceptions for 2013 Performance Criteria

Revised November 30, 2012

Would you like to know which servicing activities have the greatest impact on your performance ranking? You can use the weights we just assigned to each of the new servicing performance criterion for 2013 as a guide.

Criteria Weights

We recently announced new servicing performance criteria for your 2013 Freddie Mac Servicer Success Scorecard. As with your current Scorecard, each new criterion will contribute a certain percentage to your overall servicing performance results. To improve consistency, we will apply a rolling three-month evaluation period to every performance criterion. Here are the weights we have assigned to each new criterion.

Investor Reporting Criteria
Cash Management
35% Shortage Percentage — The cumulative total of each day’s cash shortage amount expressed as a percentage of the total due for the period.
Data Integrity and Operational Management
10% Percent Hard Rejects Over 90 Days Old — The number of edits to be cleared that are outstanding greater than 90 days expressed as a percentage of the total loans in the Servicer’s portfolio for that period.
10% Percent Soft Rejects Over 90 Old — The number of system cleared edits for greater than 90 days expressed as a percentage of the total loans in the Servicer’s portfolio for that period.
15% Percent of Hard Rejects Which Occurred in Reporting Cycle to Total Loans in Portfolio — The number of initial edits to be cleared and require the Servicer to correct the transaction expressed as a percentage of the total loans in the Servicer’s portfolio for that period.
5% Percent of Soft Rejects Which Occurred in Reporting Cycle to Total Loans In Portfolio — The number of system cleared edits expressed as a percentage of the total loans in the Servicer’s portfolio for that period.
10% Percent of Ending Hard Rejects to Total Loans in Portfolio — The number of edits to be cleared that were not corrected by the Servicer prior to cycle close expressed as a percentage of the total loans in the Servicer’s portfolio for that period.
15% Average Number of Days to Report Payoffs — The average number of days to report a payoff to in the reporting cycle.
Default Management Criteria
Loss Mitigation
5% Transition to 60+ — The number of loans that roll from a less than 60 day delinquent status to a 60+ day delinquent or loss liquidation status over a three-month reporting period.
10% 60 to Worse — The number of 60 day delinquent loans at the beginning of the month that migrated to a 90+ delinquent or loss liquidation status at the end of the month divided by the beginning 60-day delinquent loan count.
10% 90+ to Better — The number of 90+ day delinquent loans at the beginning of the month that transitioned to a less or equally delinquent status divided by the beginning 90+ days delinquent loan count.
10% 90+ to Worse — The number of 90+ delinquent loans that transition to a further state of delinquency in the following month divided by the total number of 90+ delinquent loans in the previous month. This criterion excludes loans in an active foreclosure or trial plan status.
15% Retention Efficiency — The number of retention workouts closed over a three-month period compared to the average 90+ day delinquent population for the same measurement period. Initiated trial modifications, closed modifications not requiring a trial period, and completed repayment plans for loans that were 60 days or more delinquent will be considered in the numerator.
15% Liquidation Efficiency — The number of liquidation workouts closed over a three-month period compared to the average 90+ day delinquent population for the same measurement period. Pre-foreclosure sales, third-party sales, and deeds-in-lieu of foreclosure, including Home Affordable Foreclosure Alternatives (HAFA), will be considered in the numerator.
Workout Effectiveness
2% 6-Month Performance — Measures the number of loans that are current six months after the modification closing date.
2% 12-Month Performance — Measures the number of loans that are current 12 months after the modification closing date.
1% Timing of Liquidation Solutions — The number of closed pre-foreclosure sales and deeds-in-lieu of foreclosure that were less than 210 days delinquent at the time of closing divided by the total number of pre-foreclosure sales and deeds-in-lieu of foreclosure closed for the month.
Default Timeline Management
10% Loans Beyond Foreclosure Sale Threshold — Number of 180+ days delinquent loans and loans that liquidated at 180+ days delinquent that have exceeded the allowable published foreclosure state standard divided by the total count of loans that are greater than or equal to 180 days delinquent or were greater than or equal to 180 days delinquent at the time of liquidation. Liquidations include pre-foreclosure sales, deeds-in-lieu of foreclosure, and completed foreclosure sales.
10% Average Age of Past Foreclosure Sale Standard — Average age of 180+ days delinquent loans and loans that liquidated at 180+ days delinquent that are beyond the published allowable foreclosure state standards.
Data Integrity
6% Initial Delinquency Reporting Edits — The number of edits in the first monthly default reporting transmission compared to the total number of 30+ delinquent loans in the Servicer’s portfolio.
2% Final Delinquency Reporting Edits — The number of edits that have not been resolved plus the number of 90+ delinquent loans and loans in foreclosure that have not been reported as of the sixth business day compared to total number of 30 + delinquent loans in the Servicer’s portfolio.
1% Accuracy of DDLPI Reporting — The percentage of the Servicer’s 30+ delinquent loans reported with DDLPIs that are inconsistent with the DDLPI information reported via loan-level reporting.
1% Timely REO Notification — The average number of days to report foreclosure sale results from the first business day after the sale date to the date the Servicer reports the sale results.

Exclusions to Default Management Criteria

We will exclude certain mortgages from the following 2013 servicing performance criteria results:

  • Default Management criteria with the exception of Data Integrity criteria:
    • Loans guaranteed by the Federal Housing Administration (FHA), Department of Veterans Affairs (VA), or United States Department of Agriculture (for mortgages originated under the Rural Housing Service Section 502 Guaranteed Loan Program)
  • Timely REO Notification:
    • Redemptions, REO rollbacks and approved waivers
  • Default Time Line Management Criteria
  • The performance criteria Loans Beyond Foreclosure Sale Threshold and Average Age of Past Foreclosure Sale Standard measure three distinct populations of mortgages:
    1. Loans 180 or more days delinquent or foreclosed
    2. Short sales and deeds-in-lieu
    3. REOs

We will exclude mortgages in the following process sub-statuses from the performance measurement of loans 180 or more days delinquent or foreclosed:

  • Military indulgence
  • Agency delay
  • Foreclosure sale (third party, HUD conveyance, recourse, REO pending)
  • Open REO
  • Settled REO
  • Internal delay

In the other populations (i.e., mortgages resulting in a short sale, deed-in-lieu, or REO) mortgages with these process sub-statuses will be included in the Loans Beyond Foreclosure Sale Threshold and Average Age of Past Foreclosure Sale Standard performance criteria. Mortgages reported with allowable foreclosure time line delays will also be included in all of the populations of mortgages measured under these criteria.

Get More Information

For more information on the Servicer Success Scorecard:

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