New Activity Thresholds, Low Activity Fee, and Other Updates in Guide Bulletin 2013-8
We are introducing new Seller/Servicer activity thresholds in Single-Family Seller/Servicer Guide (Guide) Bulletin 2013-8, and a new fee that will be assessed if a Seller/Servicer does not meet at least one of these thresholds. This new requirement supports our risk management efforts and offsets the costs incurred to maintain our Seller/Servicers and monitor their compliance with our eligibility requirements. To give you time to prepare for this new requirement, the Low Activity Fee will not be assessed until January 1, 2014.
Today's Guide Bulletin also announces key updates to our eligibility requirements for living trusts, land trusts, Condominium Unit Mortgages, and super conforming mortgages. In addition, the Guide Bulletin includes important information for Sellers and Servicers about our requirements regarding disclosure of mortgage insurance information and fraud investigations.
Also review today's Bulletin for other Guide updates and additional information you need to be familiar with to do business with Freddie Mac.
Sell & Deliver and Servicing
- New Seller/Servicer activity thresholds and Low Activity Fee. Beginning January 1, 2014, Seller/Servicers that do not meet one of the following activity thresholds will be assessed the Low Activity Fee of $7,500:
- Sell mortgages to Freddie Mac with an aggregate unpaid principal balance (UPB) greater than $5 million during the immediately preceding calendar year, or
- Service, or be a servicing agent for, mortgages for Freddie Mac with an aggregate UPB of at least $25 million as of December 31 of the immediately preceding calendar year.
New Seller/Servicers will not be subject to these thresholds until they have been approved for a full calendar year.
- Fraud prevention, control, and reporting. Effective July 1, 2013, Seller/Servicers will be required to comply with the deadlines we specify when we request cooperation in a fraud investigation.
- Disclosure of mortgage insurance information. Sellers/Servicers must instruct mortgage insurers (MI) to release information we request on mortgages that they've insured and are sold to and/or serviced for Freddie Mac.To meet this requirement and as announced in Guide Bulletin 2013-6, Seller/Servicers must return a new Guide Form 1207, Freddie Mac Mortgage Insurance Information Disclosure Agreement, executed by both the Seller/Servicer and the respective MI by July 31, 2013, or before the MI begins providing insurance coverage, whichever is later. This requirement does not apply to mortgages insured by Essent Guaranty, Inc. and National Mortgage Insurance Corporation.
Originate & Underwrite and Sell & Deliver
- In response to feedback from Sellers, we're providing more guidance and flexibility to our requirements for:
- Living trusts. We are providing more specificity on our trust eligibility requirements and clarifying our requirements for refinance transactions. In addition, effective for mortgages with note dates on or after September 1, 2013, we are expanding our eligible occupancy types to include investment properties, and modifying our signature requirements. However, loan documents may be executed using our revised signature requirements immediately.
- Condominium Unit Mortgages. Effective for mortgages with settlement dates on or after June 1, 2013, we will allow Sellers to use streamlined reviews for super conforming Condominium Unit Mortgages.
- Land trusts. Effective September 1, 2013, mortgages on properties for which the legal and equitable title is held by a land trust will no longer be eligible for purchase under the Guide. Sellers must have a negotiated term of business to sell us such mortgages.
- Super conforming mortgage delivery requirements. Effective June 1, 2013, we are no longer allowing Sellers with Guarantor Master Commitments to take out fixed-rate Cash contracts for the sale of super conforming mortgages.
Other Guide Updates
Please review today's Guide Bulletin for important updates, including, but not limited to:
- Extension of our Freddie Mac Relief Refinance MortgageSM offering to December 31, 2015.
- Addition of Home Value Explorer® results and feedback in the Uniform Collateral Data Portal®.
- Additional detail and clarifying information for the delivery of certain Uniform Loan Delivery Dataset (ULDD) data points.