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Freddie Mac Flex Modification

The Freddie Mac Flex Modification® (Flex Modification) offers Servicers an easier, flexible way of helping more borrowers qualify for a loan modification in a changing housing environment. Since we announced the Flex Modification in December 2016, we've sent our Servicers reminders and updates to prepare you for the October 1 mandatory evaluation date.

Mortgage and Borrower Eligibility

Eligible Property Types

While the Flex Modification leverages the previously available Freddie Mac Standard and Streamlined Modifications, a few significant changes from the Standard Modification include:

  • The housing-to-income ratio component for borrowers less than 90 days delinquent has changed from less than or equal to 55 percent with a 10 percent floor to less than or equal to 40 percent.
  • No choice of amortization terms for borrowers with a mark-to-market loan-to-value (MTMLTV) ratio less than 80 percent.
  • You must now forbear principal down to a 100 percent MTMLTV ratio (not to exceed 30 percent of the unpaid principal balance rather than the 115 percent MTMLTV ratio previously allowed under Standard and Streamlined Modifications).

Evaluation Hierarchy

Prior to implementing the Flex Modification, Servicers must follow the existing loss mitigation evaluation hierarchy as described in Guide Section 9201.2. Once a Servicer implements the Flex Modification, they must discontinue evaluating borrowers for the Standard and Streamlined Modifications, and instead evaluate borrowers in accordance with the evaluation hierarchy outlined in this Guide Bulletin.

What Servicers Need to Do

Review Single-Family Seller/Servicer Guide (Guide) Bulletin 2016-22, Guide Bulletin 2017-1 and Guide Bulletin 2017-5 requirements for the Flex Modification, including the eligibility requirements, modification terms, requirements for a streamlined offer for the Flex Modification, evaluation hierarchy, and processing and reporting requirements. 

Please note that you're no longer able to evaluate borrowers for Freddie Mac Standard and Streamlined Modifications. We encourage you to bookmark this new Freddie Mac Flex Modification webpage for modification information and reminders.

Training and Resources

Now that we’re past the October 1 mandatory evaluation date and you’ve begun evaluating borrowers for Flex Modification Trial Period Plans, we want to remind you that we offer the following training and resources to make your evaluations as smooth as possible going forward.


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