Freddie Mac issued Bulletin 2024-07 (Bulletin) announcing revisions to the Single-Family Seller/Servicer Guide. Per the Bulletin, Freddie Mac:
- Clarified that interested party contributions do not include costs associated with builder forward commitments (a commitment from a lender to offer future buyers a specific mortgage interest rate);
- Created a new Investor Feature Identifier (J70) for mortgages originated under builder forward commitments;
- Updated requirements to allow appraisers to use virtual technology to inspect and confirm the completion of new or proposed construction or required repairs on existing properties;
- Updated requirements to allow borrowers to use Form 400 (Warranty of Completion of Construction or Repair/Alterations) to confirm completion of construction or repairs for appraisal reports and completion of repairs for property data reports;
- Created a new Investor Feature Identifier (K09) for “First-Generation Homebuyer Mortgages”;
- Clarified that when a flood insurance policy shows both a full risk premium and a discounted premium, the full risk premium (plus any fees and surcharges) must be used to calculate the housing expense-to-income and debt payment-to-income ratios;
- Retired several restrictions related to custom and lender-paid mortgage insurance;
- Updated requirements to allow the sale of Community Land Trust mortgages to Freddie Mac without review of the additional ground lease, if the Community Land Trust is included in the “Shared Eq – Model Forms” tab on Fannie Mae’s Certified Shared Equity Program List;
- Removed the end date to a temporary waiver allowing mortgages to be purchased by Freddie Mac with private transfer fee covenants (the waiver is now permanent);
- Updated the definition of “Agency” to provide additional specificity for entities that may provide financial assistance (e.g., through an Affordable Second) when certain eligibility requirements are met; and
- Clarified that the effective date for reconsideration of value requirements announced in Bulletin 2024-06 are effective for mortgages with application received dates on or after August 29, 2024.
Revisions related to builder forward commitments are effective for mortgages with application received dates on or after September 4, 2024. Revisions related to flood insurance premiums are effective for mortgages with Note dates on or after September 5, 2024 (lenders are, however, encouraged to implement immediately). All other revisions are effective June 5, 2024.
Click to view the Freddie Mac Guide Bulletin 2024-07: https://www.tenaco.com/wp-content/uploads/2024/06/Freddie-Mac-Guide-Bulletin-2024-7-06-05-24.pdf
