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Easier Collateral QC and Underwriting with Loan Collateral Advisor Updates

October 31, 2018

You told us how we could improve to help your business. We listened. New enhancements to Loan Collateral Advisor® will help make it easier and more efficient for you to QC and underwrite appraisals. Here’s what’s new:

Simpler Scoring

We’ve changed from two risk scores to one. The new LCA Risk Score gives Loan Collateral Advisor’s assessment of valuation risk, on a scale of 1 to 5 (in .5 increments). The lower the score, the lower the risk.

Set Rep and Warranty Eligibility Threshold

Collateral rep and warranty relief eligibility is more transparent and tied to the risk score. Appraisals with a score of 2.5 or less are eligible for relief.

Increased Rep and Warranty Relief Rates

We’ve done two things to make more appraisals eligible for collateral rep and warranty relief. First, we’ve extended eligibility to condo units. Next, we’re removing condition and marketability and we’re providing rep and warranty relief on the value of the property only – consistent with the new, single risk score.

Grouped Feedback Messages

We’ve categorized messages and grouped them to help you more efficiently identify potential issues during appraisal review.

Less Feedback on Rep and Warranty Eligible Appraisals

We’ve reduced the number of messages you’ll receive on appraisals that are eligible for collateral rep and warranty relief.

We have updated training materials about these enhancements in the Freddie Mac Learning Center. Register for our “Using Loan Collateral Advisor” webinar, watch our “3 Things to Know About the Loan Collateral Advisor Enhancements” video clip and access a variety of other resources.

For More Information: