Now It's Even Easier to Originate Condominium Loans
July 16, 2018
Home prices and interest rates are rising. Inventory is low. Finding housing can be a challenge and home buyers need options. Freddie Mac’s automated collateral evaluation (ACE) makes it easier for you to help borrowers purchase condominium units and refinance them quicker without an appraisal.
Since its launch last year, ACE has helped lenders save their borrowers time and money on certain Loan Product Advisor® mortgages. Now, ACE is available for eligible condominium units, allowing you to forgo a traditional appraisal and pass along savings to your condominium borrowers.
Note: Condominium unit loans that are eligible for ACE must still comply with Freddie Mac’s condominium project review and eligibility requirements.
Here’s What Else Has Changed
We listened to your feedback and made additional changes to condominium project requirements to help you more efficiently and effectively meet the needs of your borrowers. Here’s what’s new:
- You’ll now be able to use the detached condominium project review type for detached units in projects with a mix of attached, detached and/or semi-detached units.
- We’ve simplified the process for Freddie Mac-owned “no cash-out” refinance condominium units by removing the need to transfer the credit enhancement. We’ve also removed the requirement to deliver the Freddie Mac loan number for these units, but when available, we still encourage you to deliver it.
- You’ve got more flexibility with new condominium projects going through a non-gut conversion. And you’ll also be permitted to use the required working capital fund to meet the reserve requirements for new condominium projects.
- You can consider more condominium projects with updated guidelines around ineligible projects, including single entity ownership and projects in litigation.
Please refer to Single-Family Seller/Servicer Guide Bulletin 2018-10 for more details about these enhancements to our condominium project requirements.