Freddie Mac Industry Letter
October 4th, 2010
Freddie Mac issued an Industry Letter titled, Foreclosure Proceedings.
Subject: Foreclosure Proceedings
Freddie Mac is deeply concerned by recent news articles which report that affidavits used in foreclosure proceedings may have been executed inappropriately and without proper notarization. The practices described in these reports violate both applicable law and Freddie Mac’s contractual Servicing requirements as set forth in the Freddie Mac Single-Family Seller/Servicer Guide (“Guide”).
Through this Industry Letter, Freddie Mac seeks to reinforce our commitment to safeguarding the legal rights of Borrowers. We are also reaffirming our focus on protecting the integrity of the foreclosure process. Accordingly, Freddie Mac is requiring Servicers to review their Servicing operations to verify the adequacy of their processes regarding the execution of affidavits and to notify Freddie Mac of any identified deficiencies.
Process review
Each Servicer must conduct a review of its Servicing operations with respect to Freddie Mac foreclosures which are either: a) currently pending or b) within the applicable judgment review period in each State.
Specifically, the Servicer must determine whether:
■ The Servicer’s policies, procedures and processes were and continue to be adequate to ensure that the affidavits executed in connection with these proceedings are in compliance with applicable law, including that the individuals signing the affidavits (“Affiant”) had personal knowledge of the facts and that signatures were properly notarized; and
■ The Servicer’s employees and/or third parties responsible for executing affidavits supplied by the Servicer in these proceedings followed the above-described policies, procedures and processes, including those which required the Affiant to have personal knowledge of the facts and those which required proper notarization. If the Servicer cannot reasonably communicate with any such employee or third party directly, the Servicer should verify this information with the employee’s or third party’s former supervisor, to the extent possible.
Notification
The Servicer must complete its review by October 18, 2010.
In the event that the Servicer’s review creates any question as to whether: 1) its policies, procedures or processes regarding the execution of affidavits were adequate to ensure compliance with both applicable law and Freddie Mac’s Servicing requirements, or 2) its employees and/or third parties followed the proper policies, procedures and processes, the Servicer must immediately notify Freddie Mac at SRPMconfirmations@FreddieMac.com or (800) FREDDIE (and select “Servicing”).
The Servicer must also remedy any deficiencies identified in order to ensure compliance with applicable law and Freddie Mac’s Servicing requirements.
Freddie Mac reserves all rights and remedies available to it under the Guide and other Purchase Documents.
Sincerely,
Tracy Mooney
Senior Vice President
Servicer Relationship & Performance Management
To view the online Industry Letter, please click here
To view the Press Release, please click here
About Safeguard
Safeguard Properties is the largest privately held field services company in the country. Located in Cleveland, Ohio and founded in 1990 by Robert Klein, Safeguard has grown from a regional preservation company with a few employees and a handful of contractors performing services in the Midwest, to a national company with approximately 800 employees. Safeguard is supported by a nationwide network of subcontractors able to perform any requested superintendence, preservation, and maintenance functions, as well as numerous ancillary services in the U.S., the Virgin Islands, and Puerto Rico.