Freddie Mac Announces Most Recent Servicing Updates

Weiner Brodsky Kider PC

Weiner Brodsky Kider PC

Issues such as calculating housing expense-to-income (HTI) ratios and updates to previous servicing bulletins were addressed in Freddie Mac’s recently published Bulletin 2020-22.

Freddie Mac announced that with respect to calculating a borrower’s monthly HTI, project escrow shortages should be omitted from this calculation when evaluating a borrower for imminent default or when making a determination as to the borrower’s ability to make a cash contribution towards a short sale or deed-in-lieu of foreclosure.  However, servicers are to continue including any escrow shortages that were already considered as a part of the borrower’s contractual monthly payment.

In addition, minor updates were made for clarification to property insurance requirements, including requirements regarding the insurer’s licensing and ratings, the type and amount of the insurance coverage and lastly, flood insurance requirements. 

With the exception of the provision on calculating HTI (which becomes effective on September 1, 2020) and third-party business continuity planning requirements (which become effective on October 1, 2020), all other changes noted in this Bulletin are effective immediately.

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.

© Weiner Brodsky Kider PC | Attorney Advertising

Written by:

Weiner Brodsky Kider PC

Weiner Brodsky Kider PC on:

Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
- hide
- hide

This website uses cookies to improve user experience, track anonymous site usage, store authorization tokens and permit sharing on social media networks. By continuing to browse this website you accept the use of cookies. Click here to read more about how we use cookies.