Freddie Mac has released its June 22nd Bulletin amending several Selling and Servicing requirements.

Amendments to the Servicing requirements include;

• Using automated valuations for certain workout options -  Servicers may now utilize Freddie Mac automated valuations provided by BPOdirect (“automated values”) for the evaluation of certain workout options. Servicers are no longer required to order an exterior Broker Price Opinion (BPO) if an automated value is available for the following workout options on Mortgages secured by 1-unit properties that are not Manufactured Homes:
  a)  Long-term forbearances
  b)  Loan modifications
  c)  Workout Mortgage assumptions
  If no automated value is available, the Servicer must order an exterior BPO for these workout options. Freddie Mac will continue to require an interior BPO for all workout types for Mortgages secured by 2- to 4-unit properties and Manufactured Homes.

• Expense reimbursement changes -
  Utility expense reimbursement
  Freddie Mac has updated the property preservation requirements to emphasize that Servicers may continue utilities on abandoned properties when it is necessary to protect the property from waste, damage and vandalism. While Guide requirements instructed Servicers to take steps when necessary to preserve and protect abandoned properties from waste and damage prior to foreclosure sale, there was previously no specific guidance for the continuation of utilities when necessary or for the reimbursement of utility expenses on abandoned properties during this time period.
  Additional areas updated in regards to reimbursement include;
  a)  Tax penalties
  b)  Property insurance premiums
  c)  The expense reimbursement process
  d)  New adjustment codes

• Reporting deadline change - Effective September 1, 2007, Freddie Mac will change the reporting deadline to require Servicers to:
  a)  Report a short payoff, make whole and third-party foreclosure sale within two Business Days of receiving the proceeds and,
  b)  Report a charge-off within two Business Days of receiving Freddie Mac approval
  Currently, Servicers are required to report prepaid and matured Mortgage payoffs within two Business Days of receiving the proceeds. This change will add consistency to the payoff reporting process by requiring all payoff reporting to be completed within the same timeframe.

• Requirements regarding adverse action notice/compliance with law - Section B65.31 has been updated to clarify that a Servicer must send the Borrower an adverse action notice when Freddie Mac has denied a Mortgage assumption, whether or not the Borrower is delinquent  at the time.
  Exhibit 53, ECOA Form Letter Response to Loan Assumption Application, has been removed from the Guide and Servicers are reminded that they must comply with applicable law in determining appropriate notices and disclosure to provide to an applicant.

• Designated counsel/trustee - On May 16, 2007 Freddie Mac  announced a change in designated counsel for the State of Texas via e-mail. As a reminder, as of June 1, 2007, Freddie Mac added three new firms. Also as of June 1, 2007, Michael J. Schroeder, P.C.is no longer accepting new referrals under the Designated Counsel Program. The Designated Counsel/Trustee List reflects the new counsel and updated contact information. The Designated Counsel/Trustee List (formerly Exhibit 79) is located on FreddieMac.com at: http://www.freddiemac.com/service/msp/desig_counsel.html.

• Redesign of Form 104SF - Guide Form 104SF has been redesigned to remove redundancies and add new data elements, which should result in more efficient claim processing. The Online 104SF Reimbursement System is also being updated to reflect these changes.

• Transfer of Servicing processing fee - Effective July 1, 2007, for any Form 981 Agreement for Subsequent Transfer of Servicing submitted to Freddie Mac, Transferor Servicers will be billed the processing fee on the Performing Loans monthly Servicer Billing Statement and must remit payment in accordance with the requirements for remitting payment of fees billed on their monthly billing statement. Freddie Mac will be eliminating the current process for remittance via check. 

• Form 104DC submission deadline - Freddie Mac has updated Section 71.20 to include the submission deadline for Form 104DC. Servicers are reminded that they must submit Form 104DC (via paper or online) so that Freddie Mac receives it within 30 days of the acquisition date.

• Changes to Directory 5 - Directory 5 is being revised to:
  a)  Add a specific e-mail address for expense-related questions and/or submissions associated with FHA, VA and RHS Mortgages.
  b)  Delete the e-mail address for requests related to changes to the Mortgaged Premises since this e-mail method of notification was not well utilized. Effective immediately, requests related to changes to the Mortgaged Premises (see Section 51.7) must be submitted by fax.

  To view the Bulletin in its entirety, including all the Selling requirements, please click here.