Freddie recently announced updates to its Guide pertaining to Home Possible Mortgages, Mortgage underwriting and eligibility, property eligibility and appraisals, Address Confidentiality Programs, and more. Several of these updates are effective immediately, while others are effective in the coming months.
For certain Home Possible Mortgages with settlement dates on and after November 15, 2021, Freddie increased the maximum LTV/TLTV ratio to 105%. For Home Possible Mortgages with Affordable Seconds, the TLTV ratio may exceed the limits stated in the chart in Guide Section 4501.10, provided the TLTV does not exceed 105% and the Mortgage is not a super conforming Mortgage. Further, when the LTV, TLTV, or HTLTV are greater than 95%, the minimum borrower contribution must be 3% of the home value for purchase transactions.
Freddie also announced the removal of A-minus and Affordable Merit Rate Mortgages from the Guide, effective for Mortgages with Settlement Dates on and after January 1, 2022. And for Mortgages with Settlement Dates on and after December 1, 2021, all YTD paystubs must be dated no more than 30 days before the Application Received Date.
In addition, Freddie updated its Manufactured Home appraisal requirements, adding the existing property feature requirements for CHOICEHome® offering to the Guide and updating the calculation for determining the LTV ratio for certain “no cash-out” refinance transactions secured by Manufactured Homes. And effective for Mortgages with Settlement Dates on and after November 15, 2021, Freddie will be permitting Mortgages for single-wide Manufactured Homes located outside of Planned Unit Development or Condominium Projects to be sold to Freddie Mac, subject to written approval.
Effective December 1, 2021, sellers are required to inform Freddie of a Borrower’s substitute Address Confidentiality Program mailing address.