|Freddie Updates Loan Prospector (Effective June 23, 2013) May 2013|
Great update! Take some time to review the new feedback restrictions and the new sample LP Feedback Certificate. You can now more efficiently identify what changes must be made before you re-attempt running the loan back through LP, which may greatly reduce multiple runs through LP. This has become a Red Flag for the QC portion of the business as it usually indicates excessive attempts to ‘make the loan work’.
|Freddie Mac Update Loan Prospector on May 12, 2013 April 2013|
Really, this is almost meaningless and there is no true impact to your business due to these enhancements. I will say that the HVE update is interesting. Freddie is getting rid of the standard 20% benchmark for variance/tolerances for their HVE product and moving to a variance percentage that will be triggered by a variance percentage, loan type and the HVE confidence score.
|Freddie Revises Guidelines for Relief Refinance Mortgages and Lender Contributions – Bulletin 2013-2 (Effective April 30, 2013) Freddie Lender Contribution Rules February 2013|
Huh???? Freddie (and Fannie) have posted “Lender Incentive” rules. They say you can offer “gift cards valued up to $500” as an incentive for people to do ”refinance” business with you. One way to think about it is like new-car incentives. However, in the mortgage business, you are marketing to people to close the loan with YOU and you’ll pay them $500.
(Freddie Mac Selling Guide Bulletin 2013-2 Dated January 31, 2013 )
|Freddie Updates Loan Prospector Feedback Messages – Release Notes 12-19-12 (Effective 12-14-12) January 2013|
If you are a long-time user of LP you know many of the frustrations that go into using this as a tool for originating and underwriting. The messaging now very clearly indicates when you must manually underwrite a file when an authorized user account shows up, and what steps you must take and validate if you do not downgrade to a manual underwrite. Website link to LP Feedback Message Codes provided in this article.
(Loan Prospector February 10 Release Notes (Dated December 19, 2012))
|Freddie Provides Additional Option for Verbal VOE’s – Bulletin 2012-28 (Effective 12-14-12) January 2013|
What is changing, and effective immediately, is that you now have the option of obtaining the verbal VOE for employed borrowers and the verification of existence of business for self-employed borrowers after the note date, but prior to the delivery date of the mortgage to Freddie. You run the risk, if you postpone getting the verbal VOE or the evidence of existence of business until after the note date, of not being able to obtain these verifications at all.
(Updated Documentation Requirements Provide More Flexibility as Announced in Guide Bulletin 2012-28)
|Freddie Mac Updates Rules Related to Properties Affected by Disasters - Bulletin 2012-24 (Effective November 1, 2012) Freddie Mac and Disaster Properties November 2012|
Freddie Mac issued Bulletin 2012-24, with their own version of “properties affected by disasters.” It’s really in two parts—a “general” update for properties that may be declared a disaster in the “future,” and then specifically for Hurricane Sandy. Link provided to check which counties and states are eligible.
|Freddie Mac Home Changes ARM Rate Caps & Home Possible® Area Median Income Guidance – Bulletin 2012-21 (Effective Nov 18, 2012 and July 1, 2013) November 2012|
I do not see either of these two topics having a big impact immediately. The market is still very focused on fixed rate mortgages and will continue to be an FRM market until we see a spike in rates. No real impact for you on these topics unless you market ARM’s or originate Home Possible Mortgages.
|Freddie Updates Various Topics: Relief Refinance Mortgages; Same Servicer; and FHLMC Relief Refinance Mortgages – Open Access (Effective November 19, 2012) Denied in the past by Freddie Mac October 2012|
The key to these changes is to really know what you “do” and “do not need” on these Freddie refinance options. The key is not to over-document these files. They are making this as streamlined as possible, so that more borrowers can qualify.
(FHLMC Bulletin Number: 2012-19 Dated September 14, 2012)
|Freddie Mac introduces a cash-out option for properties acquired within 6 months of acquisition (Delayed Financing Exception). Selling Guide Section 24.6 (Effective 7-23-12) September 2012|
This is great news. You now have a choice of which agency to use when looking to assist a borrower who has acquired a property within the past six months that they would like to refinance to recoup the costs of acquisition.
(FHLMC Selling Guide Section 24.6 – Released and Updated 7/23/2012)
|Freddie Reduces a primary fee for HARP L:oans (Effective 5-15-12) May 2012|
FHLMC is really trying to entice more lenders and aggregators to pursue the HARP program for eligible borrowers, and draw attention to themselves so that they can appear to be that ‘knight in shining armor’. In practice this may not be as widespread or available as FHLMC would like the public to think. You are competing against other lenders that have access to this delivery option through FHLMC, which could put you at a disadvantage of up to .50 basis points on your rate/price quote.
(FHLMC Single Family News Bulletin – Dated May 9th, 2012)
|Communication Time Lines for Short Sales Established [Download Mortgage Talking PointsTM flyer, Fannie Mae & Freddie Mac Short Sale Servicing Timeline] (FNMA Annc. SVC 2012-7 - Effective June 25, 2012 | FHLMC Bulletin 2012-9 - Effective June 15, 2012) FannieFreddie Short Sales May 2012|
Why is this important to you? Right now there is a backlog of homes and borrowers that could benefit from a quicker path to a short sale as a foreclosure alternative, as well as myriad processes and paperwork – but no accountability or service that the servicer is obligated to follow on a consistent basis. This will empower the borrower and the realtor that is assisting with the short sale with the expectations and knowledge to challenge the servicer when the new timelines are not met.
(FNMA Annc. SVC 2012-7 - Effective June 25, 2012 | FHLMC - Bulletin 2012-9 - Effective June 15, 2012)
|Freddie Announces Changes for Mortgage Credit Certificates (MCC’s) – Bulletin 2012-08 (Part 2) [Download Mortgage Talking PointsTM flyer, Mortgage Credit Certificates - A Blast from the Past] Mortgage Credit Certificate April 2012|
Freddie is now consistent with Fannie Mae in regard to how they handle an MCC. MCC’s are a great tool, and if you’re not familiar with them it is worth checking with your state housing agency to see if they are available in your state. In some cases, an MCC could help make a borrower eligible for a loan they may not have otherwise been able to get.
|Freddie Mac - Multiple Topics - Borrower funds updates; ALT 97; Forms 1120SF and 16SF updated and revised, postsettlement delivery fee changes; and ULDD requirements - Bulletin 2012-8 (Part 1) April 2012|
While there are several changes within this one bulletin, the one that you need to be concerned with is that Freddie is revising the requirements to permit net proceeds of the trade-in of the Borrower’s previously owned residence (trade equity) and prior rental payments made by the Borrower to be credited toward the purchase price of the subject property (rent credits).
(Bulletin 2012-8: Selling (03/15/12))
|Freddie Reminds of Increased Guarantee Fees – Announcement 2012-06 (Effective April 1, 2012) March 2012|
As you are probably well aware, this 10bp increase in guarantee fees applies to both Fannie Mae and Freddie Mac. Unfortunately, while the payroll tax credit is so-called “temporary,” the truth is that many hard working American families have just received the first federally mandated mortgage tax in the form of a “guarantee fee.”
|Freddie Extends for ULDD Compliance to July 23, 2012. Bulletin 2012-3. Jan. 31, 2012. February 2012|
Make sure you have explained to your staff your work flow for compliance with ULDD. In addition, you will want to make sure your software vendors are up to date and ready to go with the updated deadlines. No effect whatsoever on the origination side of things.
(Freddie Mac 2012-3)
|Freddie Updates Land Contract Payoff; Homes Purchased with Cash-Refinance Policies and Appraisal requirements. Bulletin 2011-25 (Effective Dec 16, 2011)
[Download Chart/Checklist, Freddie Mac – Land Contract Rules: Refinance or Purchase?] Freddie Mac Land Contract Rules January 2012|
Freddie is once again playing catch up with Fannie Mae. The biggie in this Bulletin is the clarification on land contract payoffs which helps to make things more clear as to whether to treat it as a refi or a purchase. Do you have any borrowers who can benefit from the cash-out refinance policy change? You may have passed on some deals previously that you can now get done.
|Freddie Changes a Couple of HARP Refinance Policies; HVE Disclosure, RMIC Same Servicer – Bulletin 2012-1 (Effective January 5, 2012) Freddie Mac prior to 53109 January 2012|
In an attempt to help more borrowers become eligible under the enhanced HARP guidelines, Freddie Mac is making it easier for more people to qualify using the Relief Refinance mortgage program. Right now, this applies to “Same Servicer” only!
|Freddie Mac Updates Buying Incentives for REO’s (Effective 11-15-11 to 1-31-12). [Download Mortgage Talking PointsTM flyer, Smart Buy Incentives to Buy Freddie Mac Foreclosed Homes] Freddie Mac REOs December 2011|
New Winter Sales Incentives. We suggest that you sign up to receive notices from Freddie when a home goes on the market in your area. That way you can post the new listing on Facebook, or even let your clients/prospects know when a new listing hits the market!
|Freddie – Home Affordable Refinance Program: What’s the Big Deal? Bulletin 2011-22 (Effective December 1, 2011) Freddie Mac and HARP November 2011|
Freddie’s HARP guidelines contain some subtle differences (vs. Fannie). Lowered LLPA’s for Owner Occupied but not NOO. Freddie does NOT want you to solicit clients to refinance Freddie-owned loans. Be careful with loans under 80% LTV with subordinate financing. Freddie, unlike Fannie decided to put a 105% TLTV/HCLTV cap on these loans. THIS CHANGE WILL KILL LOANS THAT ARE CURRENTLY ELIGIBLE! Read Fannie HARP Article to compare!
(Freddie Mac Bulletin 2011-22)
|Freddie Updates Guidance on Qualifying Income – Bulletin 2011-21 (Effective 11-4-11) Some good news for a change for Freddie November 2011|
I almost fell off my chair when I read this! And it’s good news when verifying retirement, long-term disability, Social Security and child support income. Alimony, Child Support and Separate Maintenance has been reduced to six months and for all others, you only need to verify two months of receipt. If you had any deals that you have turned down because of the history of receipt of income, these changes may bring them back to life.
(Freddie Mac Bulletin 2011-21)
|Freddie Mac HomeSteps® Smart Buy REO Properties. Freddie Mac HomeSteps November 2011|
In some parts of the country, REO’s are a significant portion of homes sold. Let your agents know about the incentives available. Oh, and you can sign up to receive notices whenever a new foreclosure is posted so you can let your agents and database know.
|Freddie Expands Clarification on Financing Rural Property Freddie Mac October 2011|
Freddie is trying to expand financing to rural properties. “In general, as long as the property is adequate collateral to back the mortgage transaction, based on the value and the marketability of the property, then the loan is eligible for sale to Freddie Mac.” However, the key to successfully getting these loans approved often times will ride on the quality of the appraisal.
(Providing Mortgage Liquidity for Rural America – September 13, 2011)
|Freddie Makes Multiple Updates to Their Selling Guide – Bulletin 2011-15 – Self-employed assets; New Construction Arms-Length Transactions; Definition of “Owner-Occupied” and Relief Refi Open Access. Freddie Mac September 2011|
The subordination agreement, the CPA letter( regarding assets being eliminated )and tracking down the servicer if you are doing a DU Refi or Refief Refi to see if “eligible for the refinance” are the big changes with Freddie this month. Oh, and just a reminder to check your files to make sure you’ll comply with the loan limits for closing as of 9-30-11.
(Freddie Mac Bulletin 2011-15)
|Freddie REO’s HomeSteps ™ Changes Incentives Again September 2011|
The incentives for paying buyer’s closing costs and a selling bonus have disappeared, but Freddie has kept a copy of incentives.
|Freddie Warns Lower Super Conforming Limits (Effective October 1, 2011) No Time to Waste August 2011|
We have known this was coming and many are still hoping that congress will step in and extend the date past the September 30, 2011 cutoff. As of the time of publication that has not been done and you should plan on the lower limits taking effect. We will keep you posted if there is a change. But you should be communicating with your agents and borrowers alike that this is no time to drag their feet.
(Single Family Update - July 18, 2011)
|Freddie Mac updates LP (Effective 7-17-2011) July 2011|
Nothing new here. Mortgage Currentcy has already informed you of these changes previously but we’ve provided links to review the updates to LP on 7-17-11. Just a reminder, Fannie Mae does still provide 97% LTV financing and almost all PMI companies are insuring them again. This may be a viable alternative to an FHA loan for some of your clients.
(Loan Prospector July 17 Release)
|Freddie Clarifies Underwriting Rules: Assets, Credit Card for Application Fees, Property Eligibility, Escrow for Repairs, Manufactured Homes, UDA – Bulletin 2011-10 – (Effective May 25, 2011) [Download 2 Mortgage Talking Points™ flyers, Conventional Loan Rules: Home Repairs Not Complete Prior to Closing AND It’s the Little Things That Count
Fannie & Freddie Rule Updates (Effective June, 2011)]
FannieFreddie June 2011|
A lot of updates from Freddie Mac, and I’m not going to lie, they write the absolute worst bulletins. Often times their bulletins cross reference multiple sections of their selling guide and in many cases still provide limited guidance. Fortunately for you, you subscribe to Mortgage Currentcy and we do the heavy lifting for you. Freddie updates: Assets, Credit Card for Application Fees, Property Eligibility, Escrow for Repairs, Manufactured Homes, UDA. Two Mortgage Talking Points™ flyers for you:
Conventional Loan Rules: Home Repairs Not Complete Prior to Closing
It\'s the Little Things That Count Fannie & Freddie Rule Updates (Effective June 2011)
|Freddie Addresses Best Practices to Cure Loan Processing Deficiencies April 2011|
As simple as these things are they are the areas where Freddie continues to see the most deficiency. This release is not so much a rule as it is a series of suggestions to help limit repurchase liability.
|Freddie Extends Home Affordable Refinance Program (Extended to June 30, 2012) April 2011|
No change to the core guidelines. A decrease in LLPAs that apply for high LTV loans that essentially puts us back to where they were previously. At the end of the day just an extension to June 30, 2012 and a repeal of the increased LLPA’s.
|Freddie Cut’s Max LTV/TLTV – Clarifies Sales Concessions - Bulletin 2011-4 (Effective June 1, 2011) [Download Mortgage Talking PointsTM flyer, The Low Down On Low Down Payment Loans]
Freddie Mac March 2011|
Freddie says they are “helping to sustain homeownership”. Okay….so buyers will have fewer low down payment options which will help current homeowners sustain their homeownership longer as they will have fewer options for buyers. Long story short, if you want to do a 3% down conventional loan after June 1st, Fannie Mae is the only game in town. [Download Mortgage Talking PointsTM flyer, The Low Down On Low Down Payment Loans]
(Freddie Changes in Maximum Financing Requirements Support Sustainable Homeownership)
|Freddie Updates Eligibility and Credit Underwriting Guides for Refinances (Effective 5-1-11) Bulletin 2011-02 Freddie Mac February 2011|
If you have done a lot of Freddie Mac owned streamline refis, the train has left the station. New credit and funds verification rules. If you have streamline refis of Freddie Mac owned loans in process, make sure you get these loans closed for delivery to Freddie before the May 1, 2011 deadline.
(Freddie Mac Bulletin 2011-02)
|Freddie Mac Extends Special Foreclosure Protections to Military Service Members Bulletin 2010-32 (Expires December 31, 2011) Freddie Mac January 2011|
While this is not origination news, it is important information for all borrowers who are experiencing financial difficulties due to active duty deployment. Be sure to let your client base know how to check if they have a Freddie Mac owned loan with the link provided in this article.
(Extension of Service Member Foreclosure Protection, Bulletin 2010-32, December 17, 2010)
|New Webpage from Freddie: Responsible Lending, Appraisal Quality &
Freddie appears to be focused on processes and underwriting guidance in stark contrast to Fannie, which seems more focused on data and delivery errors. If you are looking for a place to find operational advice, and content for training sessions/sales meetings about “quality control” topics - you really should check this out - The Responsible Lending Site covers pretty much everything.
(Single Family News)
|Freddie’s How to Use Home Value Explorer Additional Guidance – posted on Single Family News 11-17-10 December 2010|
HVE Data is useful and should be used as a tool to better understand which appraisals represent a higher risk, but Freddie realized that just putting the information out there wasn’t working. This can easily be implemented on a small or large scale operation and should be part of the best practices of any size company.
|Freddie Increases Delivery Fees – Bulletin 2010-30 (Effective 3-1-11) December 2010|
When you read this, you’d think that Freddie is walled off in a room somewhere drinking the Kool-Aid with no real world contact? These grids of delivery fees are cut-and-pasted to most rate sheets – passed directly on to the consumer –and Freddie says they AREN’T responsible? Including their statement that the borrower will “hardly notice it”? Come on, get a life Freddie?
(Freddie Mac Bulletin 2010-30)
|Freddie - Newly Constructed Homes Documentation Changes – Update to Bulletin 2010-7 (Effective 1-1-11) November 2010|
If you have access to construction lending, take the time to learn it – as economic recovery continues, this sector of lending will grow – nothing better than an under-served community of builders to grow your business.
(Freddie Mac Bulletin 2010-7 & LP News 10-15-10 )
|Freddie Updates Appraiser Independence (Effective 10-15-10), Credit Reporting & Cash Reserves (Effective 2-1-11), Bulletin 2010-23. [Download Mortgage Talking PointsTM flyer, Rules for Buying Primary Residence without Selling Current Home (Updated) & Download Charts/Checklist - Fannie vs. Freddie - Waiting Periods & Requirements (Updated)] Mortgage Talking Points flyer Rules for Buying Primary Residence without Selling Current Home November 2010|
The new rule and the sunset of HVCC doesn\'t change a thing. There are some publications out there stating that the Interim Rule doesn\'t prohibit production staff from ordering, paying for, or participating in the appraisal process directly with appraisers - but I\'m here to tell you different. Oh, and seriously review the credit changes (eff. 2-1-11) - you have some interesting new requirements.
(Freddie Mac Bulletin 2010-13)
|Freddie Updates Fraud Prevention – Bulletin 2010-22 (Effective January 1, 2011) October 2010|
Freddie is slowly but surely updating its own best practices for improving the quality of mortgage loans. If you are looking for solid QC policy and implementation material – Freddie is the best. Simply fantastic step-by-step guidance that doesn’t leave you feeling like you should have been kissed first.
(Freddie Mac Bulletin 2010-22: Fraud Detection, Prevention & Reporting)
|Fannie Loan Upgrades Data Delivery & Launches EarlyCheck™ System on September 25, 2010 October 2010|
Fannie & Freddie keep making announcements telling us that they will make announcements later… especially when Fannie says that it’s “available” but you don’t have to USE it! Can’t wait for Investor and Lender requirements!
(Hot Topics – EarlyCheck,
UAD: Uniform Appraisal Dataset, Update ULDD: Uniform Loan Delivery Dataset, LQI Reminder
|Freddie Delays Credit Inquiry Rule - New Effective Date 2-1-2011 October 2010|
Just a little refresher: For all inquires within a 120-day period (4 months) from the date of the borrower’s credit report, the lender must determine whether additional credit has been granted.
(Freddie Mac Bulletin 2010-19)
|Freddie Updates and Guidance, Includes “Evaluating Credit” (Effective 2-1-11) “Principal Curtailment on Refis”, (Effective 8-16-10) “Streamline Reviews Condo Projects”(Effective 8-16-10) – Bulletin 2010-19 September 2010|
I think Freddie gets it -- No suggestions of “refreshing a credit report” that start a cascade of consequences and then pulling back stating we never said or intended that (like Fannie)… Just simple, prudent underwriting guidance. Bottom Line: we are responsible for complete and accurate loan information through the closing date.
(Freddie Mac Bulletin 2010-19)
|Freddie Releases Their Implementation Guide for Loan Delivery Data – Bulletin 2010-15 (Effective 9-1-11) July 2010|
This is Freddie’s version of their plans to implement ULDD--Don’t waste your time on this one yet—does not go into effect until September 2011. We’re sure there will be more updates and FAQs then you can say grace over!
(Freddie Mac Bulletin 2010-15)
|Freddie Offers Help on Chinese Drywall Problem - Industry Letter 6-25-10 [Download Mortgage Talking PointsTM flyer, Some Relief for Chinese Drywall Problem] Mortgage Talking PointsTM July 2010|
We normally do not address Servicing issues like forbearance, but this issue isn’t just about a Servicing relief program. Problem Drywall comprises over 3,000 homes in 37 States, the District of Columbia, American Samoa, & Puerto Rico. Ultimately, this issue potentially affects YOUR clients and YOUR Realtor and Builder’s clients. Mortgage Talking Points: Some Relief For Chinese Drywall Problem.
(Industry Letter: Problem Drywall, 6-25-2010)
|Freddie Rescinds PUDs Rule (Eff. 6-15-10); Relief Refi Adding/Deleting Borrowers (Eff. 6-15-10) LO & Appraiser ID’s (7-1-10) – Bulletin 2010-13 – [Download Mortgage Talking PointsTM flyer, Planned Unit Developments: Keeping It Simple] Mortgage Talking PointsTM July 2010|
A couple of biggies here: PUD approvals back to where they were before (don’t have to treat as a condo) and you can now add and delete borrowers—under certain conditions!
(Freddie Mac Bulletin 2010-13)
|New LTVs for Rural Housing (effective June 13, 2010) and Manufactured Homes (effective April 8, 2010) – Bulletin 2010-09 May 2010|
This bulletin updates and clarifies some LTVs for rural housing and manufactured homes…no big deal…no surprises and unless you are selling these types of loans to Freddie, no need to read this one!
(Freddie Mac Bulletin 2010-9)
|Freddie Tightens Credit Manual Underwriting - Eliminates Interest Only Programs - Bulletin 2010-7 (Effective June 13, 2010) April 2010|
Freddie is continuing to raise credit score requirements on several targeted products. The elimination of ALL Interest Only loans caught me a little by surprise, but then again, given the times we are lending in, the real question is what took so long? -Prediction - Fannie will follow soon.
(Freddie Mac Announcement 2010-7)
|Freddie Follows Suit and Approves New Mortgage Insurers (Effective April 1, 2010) April 2010|
As expected, Freddie has approved the changes made by existing MI companies and added Essent Guaranty to the mix. Don’t expect guidelines to relax though… No changes to how loans are originated or delivered.
(Single Family Advisory)
|Freddie Updates LP Credit Requirements & HVE Feedback (Effective February 28, 2010) March 2010|
LP Releases have effective dates, corresponding Bulletins, etc… Suffice it to say, everything is now effective and if you are not able to comply with a rule change, you need to close that loan by April 1st.
(Freddie Mac February 28 Release)
|Freddie using Loan Prospector to Improve Appraisal Quality Using Home Value Explorer® (Effective February 28, 2010) March 2010|
This is intended to be a tool – use it as such, but don’t overreact. Every 20% variance does NOT require a review or second appraisal – sometimes it can be difficult to reconcile them. Watch out for delays that may result – a review or second appraisal is not a good thing.
(Freddie Mac Bulletin 2010-5)
|Freddie Mac Homeownership Series Now in Spanish - [Link to Download Brochures.] March 2010|
Download the brochures and keep them handy to send or email to your Spanish-speaking clients. Brochures are easy to customize with your contact info. Link to download all 9 of them!
|Freddie Joins the Chorus - Just Say NO to FHA Condo Approvals (Effective 2-1-10, Bulletin 2010-2) February 2010|
As predicted last month when Fannie bailed on using FHA Condo Approvals, Freddie was not far behind. The odd thing about it – Freddie lumped in VA loans as eligible. VA was the first to come out and state that they would not accept FHA Condo approvals…but Freddie will buy ineligible VA loans???
| Freddie Mac Clarifies Rules for Current Home Not Sold/Current Home Sold But Not Closed/Current Home Converted to Rental Home – Bulletin 2009-27 [Includes Mortgage Talking PointsTM flyer, Rules for Buying a Primary Residence Without Selling Current Home! (updated 11-8-2010)] Rules for Buying Home Without Selling Other Home January 2010|
This is just one section of Bulletin 2009-27—but this is the one that trips up Real Estate Agents and Loan Officers all the time. Mortgage Talking PointsTM for your agents, for you and a great topic to discuss at your next staff meeting!
(Freddie Mac Bulletin 2009-27 )
|Freddie Enhances Home Value Explorer! Also Updates State Anti-Predatory Laws! Plus LIBOR Index Resource – Bulletin 2009-25 December 2009|
Most of this bulletin covers servicing issues but we found 3 things that affect loan officers & processors! Get the link for HVE for the Relief Refi Mortgages. The Anti-Predatory added to the Guide—listing 14 states considered to be HIGH-COST loans (by state statute) are not salable to Freddie (are you one of those states?). What LIBOR resource to rely on for your disclosures.
(Freddie Mac Bulletin 2009-25)
|Freddie - Big Changes to Credit Requirements (Effective 12-4-09; 12-14-09; 2-15-10) Addition of Unique Identifiers (Effective 7-1-10) Bulletin 2009-27 December 2009|
Whew! You’ll want to read this interpretation right now! Some went into effect on 12-4-09, others - a few days from now! Highlights: Buying another home without selling current home; How rental income will be counted—or not counted; Timing of Verbal VOE extended; Self-Employed Taking Cash out of business clarified; and everyone on the planet must sign 4506T.
(Freddie Mac Bulletin 2009-27)
|Freddie Updates Loan Prospector (Effective 11-22-09 and 12-13-09) December 2009|
You will start getting real, meaningful messages from LP…imagine the possibilities. I am sure you’ve heeded my warnings – lots of changes…all coming to a Loan Prospector near you… Be aware of the Cash-Out change coming – LP is going to start alerting you to this early – but you had better not miss the settlement deadline of January 31, 2010!
(November 22 Release & December 13 Release)
|Freddie Mac Updates to Open Access Relief Refi Program (Effective October 1, 2009) November 2009|
When it first started, it was a pain to use Open Access—but it’s getting better! If you are not pursuing those loans you lost early on – don’t give up. Rates are in a good place and contacting those old leads for Freddie Relief Refis may yield some good deals.
(LP September 27 Release Single Family News)
|Freddie Updates and Housekeeping - HomeStepsTM Promotion Extended Also, Exclusionary List Updated and Condos Types! November 2009|
We’ve updated the Mortgage Talking PointsTM flyer for HomeSteps™ – this program is pretty popular and the extension gives you one more good reason to get in front of your referral sources!
|Freddie’s Best Practices – Finally Addresses Property Flipping Issues (Effective Immediately) - [Includes Mortgage Talking PointsTM flyer - Best Practices for Property Flips] November 2009|
What Freddie has done here is to define which property flipping strategies strike a medium balance – notice I didn’t say “happy”. Not only did they give us guidance for additional due diligence, but this time, the guidance comes with a stick. We all know the players in the market that are buying and flipping – We know the players we trust and the rest we don’t know – right? I can tell you this – the ones you trust are going to be questioned in ways they likely haven’t been before.
(Freddie Mac Announcement 2009-24)
|Freddie Revises Streamline Refi’s, Credit and Property Requirements – Annc. 2009-24 – Multiple Effective Dates! November 2009|
The more research I did, the more I realized this was pretty major. Streamlined-refi’s have several new requirements – not so much of a surprise but still a serious lock-down of the process. Plenty of time is given for the major changes, but you are going to want to start getting familiar with them NOW. Read the synopsis: Not only did they bury you with new guidance – they moved everything so you can’t find it!
(Freddie Mac Announcement 2009-24)
|Freddie Mac Updates - Equifax Acquisition of LandAm Credit October 2009|
Just a little ditty – housekeeping really. LP will be updated removing LACS as a drop-down option. Freddie is recommending you establish agreements with at least two Credit Reporting Companies to ensure uninterrupted access when using LPs credit options.
(Loan Prospector® News - September 17, 2009)
|Freddie Encourages (with a capital E) Use of Manual Overlay Due to LP Delay (Effective November 1, 2009) October 2009|
LP implementation seems to have hit a snag. So you are encouraged, and dare I say, “expected” to use this online tool. This process looks tedious and a bit on the difficult-to-be-successful side of things. While not complicated, I can’t see this going smoothly for you from application to close.
(Loan Prospector® Processing Reminders for Mortgages with Submission Dates prior to November 1, 2009)
|Freddie Mac Cleans Up and Corrects Miscellaneous Issues with Bulletin 2009-22 September 2009|
Dates, Dates, and more Dates to watch…be careful to monitor the dates listed for AMI and use of prior guidelines. And Agencies tend to get a little persnickety about use of old forms, so get the correct Form 91 and use it whether you have Farm Income or not.
|Freddie Creates Updated LP Matrix (Effective October 1, 2009) September 2009|
The new Documentation Matrix is a full reference tool for Loan Prospector. Guidance is given on everything from documentation level to underwriting requirements.
(Related to Freddie Bulletin 2009-18)
|Freddie Mac Updates List of People NOT TO DO BUSINESS WITH - Exclusionary List (Effective 8-21-09) September 2009|
The Exclusionary List is Freddie’s “do not use these people for anything mortgage loan related” list. You may not for any reason employ or otherwise engage parties in any part of the mortgage process whose names appear here.
Industry Letter 08/21/09: Off-cycle update to the Exclusionary List (08/21/09)
|Freddie Unveils New HomeSteps Promotion – Purchase Agreement (Exp. Date 10-30-09) September 2009|
Get the word out NOW! It’s been around for about a month now but new incentives have been added to get those REOs sold! Home Buyers get up to 3.5% towards costs, a home warranty and appliance discounts from Freddie for accepted offers until October 30, 2009 (close by year-end).
(HomeSteps 2009 Nationwide SmartBuy Purchase Program)
|Freddie Mac Relief Refinance Mortgages 125 LTV (Effective 10-1-09) August 2009|
You will have to wait until October 1, 2009 to close your l25% LTV Freddie Relief Refis (versus Fannie’s being effective 8-3-09). Remember that all Freddie Mac Relief Refinance Mortgages are subject to LLPA\' now. The only good news is there is a cap in place for LLPAs and there is incentive for borrowers to take a shorter term to help reduce the cap even further.
(Freddie Mac Bulletin 2009-20 and 2009-21)
|Freddie Clarifies and Revises Underwriting Guidelines (Effective Date 10-1-09) (Includes Freddie Best Practices Exhibit 2009-18) August 2009|
The word of the day is DOCUMENT! If you can\'t document it, then you can\'t count it! The changes and “clarifications” in Bulletin 2009-18 are numerous and have been the norm for any lender with half a brain. The problem with rules and clarifications such as these is that lenders tend to go overboard and impose their own insane overlays on top of them. Includes Freddie Best Practices Exhibit 2009-18.
(Freddie Mac Announcement 09-18)
|Freddie Mac Announces Further Enhancements to the Relief Refinance Program - 125% LTV (Effective October 1, 2009) July 2009|
The big news here is the availability of 125% LTV refinance opportunities. This option may help many homeowners, assuming rates in October are favorable. But can I rant for a second? When are these guys going to get it? The people who need the most help are the ones that have all of the LLPA’s. I understand the need to price for risk, but come on already?
(2009-07-01 Advisory Bulletin 2009-15)
|Freddie Updates to Support Super Conforming Loans - Before and After (Effective 6-14-2009) June 2009|
If you work in an area where super conforming loans are eligible, make sure you know the differences between the old guide rules and the new. The new guide rules restrict LTV’s and have more appraisal requirements. Remember, many guideline changes are already effective even though LP has not been updated yet.
|Freddie Mac Previews Changes to the Relief Refinance Program June 2009|
This is a great time to get your borrowers off the fence. If you have borrowers who you had to send back to their current lender to refinance, you may want to reach out to them again as you may now be able to assist them. We have found many lenders were slow to implement these programs and often times were unaware of the additional flexibilities available.
(Freddie Mac Advisory 2009-06-05)
|Freddie Enhances Relief Refinance Mortgage Guidelines – Part 1 – Bulletin 2009-9 (Effective April 16, 2009) May 2009|
All of the changes and enhancements from Freddie are common sense and help to make these loans a little easier to get done. Other than forcing the client to go back to the original servicer, Freddie\'s refinance options are far superior to Fannie\'s.
(Freddie Mac Bulletin 2009-9 - April 16, 2009)
|Freddie Mac Temporarily Increases Super Conforming Loan Limits – Part 2 Bulletin 2009-9 (Effective May 4, 2009) May 2009|
Whenever we get something--they seem to take something away. While loan limits are increased, guidelines and LTV\'s have been reduced. With rates remaining attractive, it is a great opportunity to reach out to your high balance borrowers who may benefit from these temporarily increased loan limits.
(Freddie Mac Bulletin 2009-9, April 16, 2009 )
|Freddie Revises Condominium Requirements (Effective July 1, 2009) April 2009|
This is one of the few times Freddie is stricter than Fannie. Read Fannie’s PERS article. Even after approved by Fannie, Freddie still wants to review! But why?
(Freddie Mac Bulletin 2009-7 - March 31, 2009)
|Freddie Mac - Sale or Conversion to Rental of Primary Residence - Includes Mortgage Talking PointsTM flyer "Rules When a Client Buys a Home and Current Home is Not Sold" April 2009|
Still a lot of confusion on what happens when a client will not be selling their current home before buying another one. We have re-capped the details (all in one place) that covers both Freddie and Fannie and outlined several differences between the two.
|Freddie Mac Condo Reference Chart - Freddie Mac Condo Reference Chart Included March 2009|
Freddie made some major changes to their condo approvals and we have created a downloadable Freddie Mac Condo Reference Chart (current as of March, 2009).
|Freddie Mac Unveils New Relief Refinance Mortgagesm Options for Servicers (Effective 4-1-09 to 6-10-2010) March 2009|
For Freddie-to-Freddie Loans—For servicers only! Talk about flexibility! If you are a loan officer who does NOT service Freddie Mac loans but the loan has been sold to Freddie, why not tell your past clients! It can only serve to help you get more referrals in the end. Fannie has their own version—which IS available to LO’s!
(Freddie Mac Bulletin 2009-5)
|Freddie Revises Loan Level Price Adjustments Again - Playing One Upsmanship with Fannie? February 2009|
I can go higher than you can! Amazing how the two keep “raising” prices and blaming it on falling house prices. Like higher cost of borrowing is going to help, duh! All LLPAs are cumulative. Missing an adjustment can be a very costly mistake. Remember, to check both Freddie and Fannie because there are subtle pricing differences.
(01-30-09 Bulletin - Post Settlement Delivery Fees)
|Freddie Mac Clarifies Establishing Borrowers Credit Reputation & Manual Underwriting February 2009|
After the refi boom, we will all be looking for ways to make deals work. Knowing how to document and put together a manually underwritten file may give you a competitive advantage. With many investors tightening their requirements for FHA, now may be a good time to get familiar with the manual underwriting criteria for Freddie. Quick Tip: A documented savings pattern for at least 12 months, counts as an acceptable non-credit related trade line.
(Freddie Overview Manually Underwritten Requirements, January 30, 2009 - Pages 8&9)
|Fannie Versus Freddie: Handy Streamline Refi Comparison Quick Reference Guide February 2009|
Review the new comparison chart we have provided and use it to expedite your approvals and close your loans quickly. Both Fannie and Freddie offer options that have no seasoning requirements. This can help should we see rate move down even further. Do NOT run DU on a streamline refinance. And yes, Freddie is much tougher than Fannie!
|Comparing Fannie & Freddie Qualifying Rules for Investment Properties - Including Mortgage Talking Points® Flyer "Working with Real Estate Investors - Know the Rules" February 2009|
Investors are buying more properties then ever and it’s about time one of the agencies realized that investors could help with the housing crisis. Mortgage Talking Points® Flyer includes Fannie Announcement 09-02 (2-6-09) new guidelines. Fannie opened the doors for well- qualified investors to purchase property at reasonable terms. Show your real estate agents to get investors back in the game.
(Freddie Mac - Fannie Mae Selling Guides)
|Home Valuation Code of Conduct (HVCC): What We Know and What We Don't Know! Effective May 1, 2009 January 2009|
Freddie Mac has adopted the Home Valuation Code of Conduct effective with all loan applications and all loans purchased 5-1-09. Fannie Mae wrote their own 6-page FAQ dated January 2009. Recognize that Freddie Mac does not always interpret the rules “exactly” the same way Fannie does. Here’s what we know, what we don’t know, including the good, the bad and the ugly!
(Freddie Mac Bulletin, January 7, 2009: Home Valuation Code of Conduct)
|Freddie Mac Manual Underwriting Guidelines, Minimum Waiting Periods for Foreclosures, Short Sales, Deed in Lieu, and More. December 2008|
Part II is manual underwriting, plain and simple. Skip it at your own risk – because nobody underwrites manually anymore. Right? Well, I beg to disagree. Whether underwriters admit it or not, most will underwrite manually if they believe in the loan file. There are more and more reasons that Lenders are forced to manually underwrite!
(Freddie Mac Bulletin - October 17, 2008)
|Freddie Mac: Product, Property & Underwriting Changes Including 45% DIT; HomePossible® Updates; Appraisal Addendums & More December 2008|
We’ve got two zingers here: (#1) – Freddie actually backed off on their threat to implement a 45% DTI on ALL loans. It will only apply to manually underwritten mortgages. Fantabulous! Especially for super-conforming loans!
(#2) - 100% financing with Freddie is out the door for good. Wait, there’s more! This Bulletin is crammed with changes that affect you.
(Freddie Mac, November 24, 2008 Bulletin)
|Freddie Mac Loan Prospector (LP) Updates - Changes Accept Plus, Super Conforming & Price/Credit December 2008|
This is about what’s updated in LP; it is NOT about rule changes. But please, don’t discount it! It’s quite a big deal. Do you have any of these loans sitting in your pipeline? Not only can you have PO’d Realtors – you could lose the deal altogether.
(Freddie News, November 18, 2008)
|Accept Plus Risk Classification Eliminated Entirely-Review Your Pipeline NOW! November 2008|
This is just one more in a long list of Freddie\'s tightening their guidelines. My guess is that the lenders won\'t take chances and you will probably have to fund all of your Accept Plus loan files by 12-7-08 or before. This means that lenders are enforcing it NOW.
(Freddie Mac Loan Prospector News, October 31, 2008)
|Freddie Has Followed Fannie with Higher Fees for High-Risk Mortgages - LTV Charts Easier to Use! November 2008|
The January 2009 date is entirely misleading. Realistically, Freddie is giving absolutely NO notice; lenders must change their fees/LTVs immediately in order to deliver the closed and funded loan to Freddie by 1-2-09. PLUS the LTV Reductions – are NOT yet incorporated into LP. It’s a scary prospect, but they must be implemented manually. LTV Chart For Subscribers.
(Freddie Mac Bulletin, October 17, 2008)
|Phase Out of Temporary Conforming Jumbo to Permanent Status - But With Some Variations! November 2008|
1- to 4- Unit NOO Properties, 2 to 4’s for Primary Residence, and $100,000 cash back on 2 to 4’s – Oh My!! These are definitely not the same animal as the Conforming Jumbo. But, what is way cool, is that Super Conforming opens the door to a lot of other loan types, such as 1-to-4 unit investment properties, for instance.
(Freddie Mac Bulletin, October 17, 2008 - Super Conforming Mortgages)
|Underwriting Changes, DTI, Minimum Indicator Score, Owns Home Buying Another, Refi Changes... November 2008|
What they’ve done is make changes to just about every single aspect of their program including underwriting, eligibility, loan-to-values, fees…everything. Freddie has ALSO announced that they intend to make a bunch of changes effective 2-1-09, but so far it’s not official. Because everyone keeps hearing about them, included in this article is a Rule Synopsis with “Changes Pending, Not Official”. It really doesn’t matter much if something is official or not if your lenders are changing their rules, but I hate reading in all of the blogs when they don’t have their facts right.
(Freddie Mac Bulletin - October 17, 2008)
|Freddie Follows Fannie - Market Condition Fee Doubles September 2008|
What’s happening is a result of the increased foreclosures and delinquencies. With the sophistication of the technology available, high-risk loan features become more identifiable and quantifiable.
Helpful Hint: Note that 15-year loans are not subject to the credit score/loan-to-value price hits. Every time you shorten the term you reduce the risk.
Obviously, many of your clients can’t afford 15-year term mortgages, but think about shortening the term any time you can. It can help with loan approvals.
(Freddie Mac Bulletin, August 8, 2008)
|Freddie Mac Warns LP Users Because Maximum LTV Not Updated in Auto-Underwriting System. September 2008|
Oh My Gawsh! These changes were made effective June 1, and Freddie still hasn’t updated LP!
What concerns me the most goes something like this: the loan officer takes a loan application and passes it on to the Processor who receives an LP approval. Assuming everything is fine and dandy, the LO moves on to the next deal as the ineligible loan is processed. The day before closing, the transaction is rejected and must be entirely restructured, if possible. Or worse, the loan is closed – and unsalable.
However, Freddie wouldn’t have “reminded” everyone if there wasn’t a problem.
(Freddie Mac August Single-Family News; August 2008 Issue)
|Median Income to be used for HomePossible® August 2008|
Every year we hear the new “area median adjusted gross income” figures. If you don’t know what they’re about, you may want to pay attention – especially if you’re not FHA-approved! A HomePossible® Mortgage is one of the best alternatives for getting borrowers approved that are not quite as “perfect” as the other Fannie & Freddie borrowers.
(Freddie Mac Bulletin, July 31, 2008)
|Fannie Mae, Freddie Mac, Maximum Loan Limits, 2009 and Beyond; End of Year Decrease - Mortgage Talking PointsTM Flyer/Email Notice Included August 2008|
Are Limits Permanent? - I also keep hearing that the new limits are permanent. What\'s permanent is the methodology and percentages of the loan amount calculations. Also, thank goodness, the floor and the ceiling will never go down.
Act Now - Send a written announcement to residents of the counties that you do business in that are currently at the $729,750. Include something like: "After 12-31-08, the maximum conforming mortgage loan in your area goes down and it can affect you personally! Act now to avoid higher mortgage rates!!"
(H.R.3221.ENR Sec.1124.Conforming Loan Limits)
|Holding Lenders and Brokers Accountable for High Quality and Accurate Appraisals June 2008|
Realize that the lender is held entirely accountable, every bit as much as the appraiser, for everything on the appraisal.
It is not acceptable to ask an appraiser to run comps to come up with a preliminary value, then move onto the next, and the next, and even the next appraiser until you find the value that you want. (See related checklist: Are You In Compliance Checklist)
Responsibilities for Good Appraisals(Freddie Mac Bulletin, May 29, 2008)
|Declining Market Policy Withdrawn - Replaced by Reduced LTVs June 2008|
Freddie came up with this Announcement on May 29th implementing a policy with significant consequences that affects loan applications as of June 1st. If you have another Freddie chart dated 6-1-08, trash it.
Then Freddie has the audacity to tell us (in a rather rude manner, I might add) that LP won\'t catch the new LTVs, and that the lenders better "conduct a manual review". And if the lender screws up...it\'s not Freddie\'s problem.
Declining Markets, Declining LTVs(Freddie Mac Bulletin, May 29, 2008)
|Expanded Fannie Mae Jumbos - With Freddie Jumbo Comparisons June 2008|
It\'s about time that Fannie finally came up to the plate with their jumbo products! We all know that the details can make or break a loan, so I\'m doing a lot of Fannie/Freddie comparisons.
I\'m surprised by how many differences there are between the two agencies. Use the differences to your advantage and go get\'em while you can!
But beware! LP approvals do not override Freddie\'s Jumbo eligibility requirements, which include credit scores and DTIs.
Expanded Fannie Mae Jumbos(Fannie Mae Announcement 08-11, May 16, 2008)
|Four-Property Ownership Limit Rule - Get Your Clients to Buy or Refi Before This Goes Into Effect on August 1, 2008 May 2008|
They just keep making it tougher and tougher for Investor loans and recentely, 2nd home mortgage restrictions are closing in! I find it amusing that these are the exact same rules that were in effect 10-15 years ago.
|Refinance Seasoning Revised for Cash-Out and No Cash-Out: Could Affect Construction-to-Perm May 2008|
Leave it to Freddie to create unique and convoluted seasoning requirements for refinances. As if seasoning isn\'t already complicated enough! Read new changes - effective 8-1-2008.
|Properties Located in Declining Markets - LTV Explained May 2008|
Most lenders were reducing LTV, TLTV and HTLTV for a long time, but this makes it clear. Effective 6-1-2008. Freddie allows two exceptions, one for streamlined refinances and one for Freddie to Freddie no cash-out refinances.
|New Underwriting Transmittal Form 1077 (Form 1008) with Revised Condo Categories May 2008|
The form is revised because all of the Freddie Condo requirements changed effective 3-1-08. If you\'re originating, processing or underwriting Freddie condos, you must understand the new requirements! Below is a listing of the new Freddie Condo categories and a link to where you can find a description and explanation.
|Home Possible® Education & Other Changes, 4 Freddie Programs Eliminated May 2008|
The Home Possible program has changed quite a bit and it\'s worth repeating. Freddie finally updated their Home Possible Mortgage Fact Sheet (not previously available). It\'s an excellent reference for those who use this program and/or work with moderate income homebuyers.
|Oh no! Another pricing adjustment - New Fees based on LTV, FICO, Cash-out, 2-to-4 units April 2008|
I will admit, it\'s the first time that I\'ve seen Freddie NOT charge a fee that they had announced. My guess is that it\'s political...but no matter, the .30% fee that would have affected over half of the loans is gone! The second bullet will have a big impact on cash-out refinances.
|Jumbo Conforming Requirements, Reasons to Use Freddie over FHA and Fannie April 2008|
I don\'t quite understand why Freddie Mac didn\'t write a Bulletin or a Letter or something else. All they did was post this information on their website, and I think it\'s rather important information! The following are my concerns and comments. So you know which product to use, look for the comparisons to Fannie Mae and FHA at the end of the comments.
|FREDDIE CONDOMINIUMS, Part II, with FANNIE CONDO COMPARISONS March 2008|
Lender Warranties - What "Fully Warrantable" means, New Condo Projects and Existing Condo Projects
Investor/Non-Owner Occupied Condo Loans
Established Projects - Fully Warrantable
New Projects - Fully Warrantable
Small Condo Projects; 2-to-4 Units in Project
Overall Conclusion explains and compares the Fannie CPM process.
Subscriber Download: Comprehensive Charts with Fannie and Freddie Condominium Requirements.
|State Anti-Predatory Lending Laws. How to get your hands on the elusive Exclusionary List. (Link provided.) March 2008|
|Conclusion to Part I and Part II (Freddie Condos with Fannie Comparisons) March 2008|
|Maximum LTV Reduced to 97%; Eliminated - Freddie 100 and Streamlined Purchase; Alt 97 Revised; Home Possible Revised (Download Information Sheets and Introductory Kit) March 2008|
|Declining Markets: Reductions to LTV March 2008|
|Fee/Pricing Increase, Credit Scores (Indicator Scores) and LTV Driven (Download new fee structure) March 2008|
|Freddie Mac - Condominium Requirements Entirely Revised: New versus Established; Streamlined Reviews; Detached Units; Manufactured Housing Condos; FHA and Fannie Mae Reciprocal Reviews February 2008|
|Added .25% to Offset Adverse Market Conditions. January 2008|
|Lender Warranties for Condominiums and Condo Eligibility Requirements Revised January 2008|
|How to Comply with Privacy Laws: Gramm-Leech-Bliley - Safeguard Act January 2008|
|Increase in Loan Fees and Pricing January 2008|