GSEs Announce UCD Delivery High-Level Timeline, Plus Separate Collection Solutions
June 30, 2015
The Uniform Closing Dataset (UCD) is a common industry dataset that allows information on the Consumer Financial Protection Bureau’s Closing Disclosure to be communicated electronically. Freddie Mac and Fannie Mae (the GSEs) have developed the UCD at the direction of the Federal Housing Finance Agency as part of the Uniform Mortgage Data Program® (UMDP®), an ongoing initiative to enhance loan quality and consistency through uniform loan data standards for the single-family loans the GSEs purchase.
The GSEs will implement separate collection solutions for lenders to start delivering the UCD no later than the fourth quarter (Q4) of 2016 and will mandate the delivery of the UCD no earlier than in the second quarter (Q2) of 2017 for all loans acquired by Freddie Mac or Fannie Mae. Additional information on the UCD implementation timeline and milestones will be provided by the end of 2015. The GSEs are providing this high-level timeline now so lenders and technology vendors can begin project planning and budgeting for the implementation of UCD in 2016.
Separate UCD Collection Solutions
After conducting research and lender outreach in 2014, the GSEs decided to implement independent collection solutions, with the following GSE-specific approaches:
- Each GSE will have separate system implementation and testing timelines for its collection solution.
- Each GSE will provide separate training and support materials designed for each collection solution.
Although the GSEs will be implementing separate UCD collection solutions, the GSEs will adhere to the guiding principles established under the UMDP, which include alignment on the following items:
- The GSEs are using an identical UCD Delivery Specification; there are no Freddie Mac- or Fannie Mae-specific UCD data requirements.
- The UCD XML file contains the same data points, enumerations, and conditionality.
- The UCD timelines are identical. The GSEs will implement separate collection solutions no later than the fourth quarter (Q4) of 2016 and will mandate the delivery of the UCD no earlier than the second quarter (Q2) of 2017.
- The GSEs will provide adequate time for testing, and will support lenders and vendors implementing the UCD with training and resources.
The GSEs will provide additional information about their separate collection solutions, implementation plans, and testing timelines later this year.
UCD Delivery File Preparation
To help prepare for the UCD delivery requirement, the GSEs highly recommend lenders begin using the UCD in their internal processes in 2016. The UCD will be implemented by lenders, vendors, and settlement service providers; therefore, lenders should begin working with their vendors and service providers now to implement and use the UCD for data exchange.
In implementing the UCD, lenders, vendors, and service providers should take the following into consideration:
- The GSEs will confirm that the UCD XML file is well-formed and validates against the MISMO Version 3.3.0 Reference Model (v3.3.0_CR_2014-02), available on the MISMO website.
- The UCD XML file must comply with the data requirements provided in Appendix A: Closing Disclosure Mapping to the MISMO v3.3.0 Reference Model.
- The UCD XML file must contain a copy of the Closing Disclosure that was presented to the Borrower and Seller at closing as an embedded Portable Document Format (.PDF) document. To see an example, please refer to the Appendix G: UCD Sample XML Files.
- For loans where split disclosures are used – a Borrower-only and Seller-only Closing Disclosure – the UCD XML file must contain both the Borrower and Seller Closing Disclosure documents.
UCD Benefits for the Industry
The GSEs developed the UCD to improve the accuracy of how the Closing Disclosure information is communicated. Standardizing the underlying data through the use of the UCD is the first step to help promote accuracy, consistency, and clarity around the loan transaction.
The GSEs are collecting the UCD in order to:
- Provide additional transparency into the mortgage loan file transaction to help assess whether the loan, as closed, meets each GSE's eligibility requirements.
- Provide important information to help enhance the GSEs' ability to detect fraud and misrepresentation at loan delivery.
- Enhance credit risk management with more data and better quality data to help reduce post-purchase data corrections.
Over time, the UCD will provide the following benefits:
- Greater data consistency promotes better and more efficient data integration and exchange across business partners.
- A common understanding, as all parties use a consistent approach and language to describe the information on the Closing Disclosure.
- Improved data accuracy because the UCD will eliminate the need for proprietary formats that can be costly to maintain and can lead to misinterpretation of the data.
More Information and Updated Appendices
Addendums to previously published UCD appendices are available on the FreddieMac.com and FannieMae.com UCD pages. These addendums provide corrections that will be reflected in the next full release of the UCD appendices planned for later this year.
- Addendum – Appendix A/B: Closing Disclosure Mapping to the MISMO v3.3 Reference Model v1.3
- Addendum – Appendix H/I: UCD Delivery Specification v1.1
Additionally, the following UCD resources have been updated:
- Appendix E: UCD Implementation Guide
- Appendix G: UCD Sample XML Files
If you have questions about the UCD, please contact your Freddie Mac or Fannie Mae representative.
This communication relates to the Uniform Mortgage Data Program®, an effort undertaken jointly by Freddie Mac and Fannie Mae at the direction of their regulator, the Federal Housing Finance Agency.