FHFA, Fannie and Freddie Launch Representation and Warranty Framework

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On September 11, the FHFA announced that Fannie Mae and Freddie Mac are launching a new representation and warranty framework for conventional loans sold or delivered on or after January 1, 2013.  The framework’s objective is to clarify lenders’ repurchase exposure and liability on future deliveries. Under the new framework: (i) lenders will be relieved of some repurchase obligations for loans that meet specific payment requirements; (ii) HARP loans will be eligible for representation and warranty relief after 12 months’ of acceptable payment history; (iii) information about exclusions from representation and warranty relief will be detailed; and (iv) Fannie Mae and Freddie Mac will make available for lenders a range of tools to improve loan quality. FHFA Release.

Published In: Administrative Agency Updates, General Business Updates, Finance & Banking Updates, Residential Real Estate Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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