Freddie Mac Removes Cap on Deliveries of Mortgages for Second Homes and Investment Properties

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Freddie Mac recently issued Bulletin 2021-30 to notify sellers that, effective September 22, 2021, it is removing the limit on the volume of deliveries of single-family mortgages secured by second homes and investment properties previously announced in Bulletin 2021-21

Freddie Mac stated that this change is being made as a result of FHFA and the Treasury suspending certain provisions of the Freddie Mac Amended and Restated Senior Preferred Stock Purchase Agreement (PSPA), including the provision that limited how many mortgages secured by second homes and investment properties that Freddie Mac could purchase. Freddie Mac noted that further changes are possible since it consistently monitors production, risk and other performance measures to ensure that it is meeting its objective of serving the market.

Further, as stated in Bulletin 2021-11, which WBK previously covered here, Freddie Mac reminded sellers that mortgages secured by second homes and investment properties continue to be ineligible as Manually Underwritten Mortgages.

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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