Freddie Mac Single-Family Seller/Servicer Guide 4606.6 — Delivery requirements and Credit Fees

Freddie Mac Single-Family Seller/Servicer Guide 4606.6 — Delivery requirements and Credit Fees

Effective 2024-11-06 · Freddie Mac's stamp for this section

See Section 6302.23 for special delivery requirements for GreenCHOICE Mortgages®. For Credit Fees related to GreenCHOICE Mortgages, the Seller/Servicer must refer to Exhibit 19, Credit Fees, and Exhibit 19A, Credit Fee Cap Eligibility Criteria. Credit Fees are paid in accordance with the Credit Fee provisions stated in Chapter 6303. See Section 4607.16(b) for special requirements when CHOICERenovation Mortgage proceeds finance renovations to improve the energy and/or water efficiency, the health and safety and/or the resiliency and preventiveness of the Mortgaged Premises and the eligibility for the credit for Credit Fees for GreenCHOICE Mortgages.

Source: Freddie Mac Single-Family Seller/Servicer Guide 4606.6 — Delivery requirements and Credit Fees · source URL · snapshot e399c3dcaab28da0

Freddie Mac Single-Family Seller/Servicer Guide 4606.6 — Contractor requirements and advancing the costs of materials — PENDING VERSION, takes effect 2027-01-25

Not yet in force. This is the pending version of the section, which takes effect 2027-01-25. The other version on this page governs until then.

Effective 2027-01-25 · Freddie Mac's stamp for this section

This section contains requirements related to: ■ Borrower as contractor ■ Contractors and/or tradespersons chosen by the Borrower ■ Eligible renovations purchased from a home improvement store (a) Borrower as contractor The Borrower may act as the general contractor and/or may perform some or all of the work to complete the eligible renovations when the following requirements are met: ■ The Borrower must be a licensed contractor when required by applicable local and/or State law ■ The Borrower must be insured to perform the eligible renovations on the subject property ■ The Borrower must be qualified to complete the eligible renovations The Borrower must submit to the Seller a plan detailing the work items the Borrower will perform. CHOICEReno eXPress® Mortgage proceeds may be used to reimburse the Borrower for the cost of materials but may not be used to reimburse the Borrower for labor costs. (b) Contractor(s) and/or tradespersons chosen by the Borrower Contractor(s) and/or tradespersons chosen by the Borrower to complete the eligible renovations must meet the following requirements: ■ The contractor(s) and/or tradespersons entered into an executed, binding renovation contract with the Borrower to complete the eligible renovations no later than the Completion Date. The contract must include an indemnification provision requiring the contractor to indemnify the Borrower for any property loss or damage caused by the contractor, its employees or its subcontractors. ■ The contractor(s) and/or tradespersons must be licensed and insured as required by local and/or State requirements ■ The contractor(s) and/or tradespersons must be financially able to perform the duties necessary to complete the renovation work in a timely manner Except when the Borrower is acting as the contractor and/or tradesperson, up to 50% of the cost of materials may be advanced to the contractor(s) and/or tradespersons at closing in lieu of such funds being deposited into the completion escrow account as described in Section 4606.7, when the above requirements are met. (c) Eligible renovations purchased from a home improvement store If the Borrower chooses a home improvement store to have the renovation work completed and the home improvement store’s renovation program requires payment-in-full at the point of purchase, eligible renovations may be purchased from the home improvement store at closing, provided the following requirements are met: ■ The CHOICEReno eXPress is a “no cash-out” refinance Mortgage ■ The Seller must review the home improvement store’s renovation program to determine that the following requirements are met: ❑ The home improvement store is financially able to perform the duties necessary to have the renovation work completed in a timely manner and pay the contractor(s) and/or tradespersons chosen by the home improvement store to complete the eligible renovations. A contractor and/or tradesperson may not require payment directly from the Borrower. ❑ The home improvement store has a robust contractor approval process that is managed, maintained and updated regularly ❑ The contractor(s) and/or tradespersons chosen by the home improvement store to complete the eligible renovations is licensed and insured as required by local and/or State requirements, and they must be approved under the home improvement store’s contractor approval process during the course of eligible renovations. In the event a contractor and/or tradesperson becomes unapproved or is unable to complete the renovation work in a timely manner, the home improvement store must choose other approved contractor(s) and/or tradespersons to complete the eligible renovations. ■ The Borrower may not be chosen by the home improvement store to complete the eligible renovations, even if the Borrower is a licensed contractor and/or is licensed and qualified to complete the eligible renovations ■ The home improvement store must have entered into an executed, binding renovation contract with the Borrower to complete the eligible renovations no later than the Completion Date. The contract must include an indemnification provision requiring the home improvement store to indemnify the Borrower for any property loss or damage caused by the contractor(s) and/or tradespersons chosen by the home improvement store to complete the eligible renovations. Up to 100% of the cost of materials and eligible renovation costs identified in the renovation contract (including labor costs) may be paid to a home improvement store at closing in lieu of such funds being deposited into the completion escrow account as described in Section 4606.7 if the requirements above are met.

Source: Freddie Mac Single-Family Seller/Servicer Guide 4606.6 — Contractor requirements and advancing the costs of materials · source URL · snapshot e399c3dcaab28da0