Freddie Mac Single-Family Seller/Servicer Guide 4607.17 — Transfers of Servicing for CHOICERenovation® Mortgages

Freddie Mac Single-Family Seller/Servicer Guide 4607.17 — Transfers of Servicing for CHOICERenovation® Mortgages

Effective 2025-09-10 · Freddie Mac's stamp for this section

This section contains requirements related to: ■ Requirements for CHOICERenovation® In Progress Mortgages related to a Concurrent Transfer of Servicing ■ Prohibited Transfers of Servicing (a) Requirements for CHOICERenovation In Progress Mortgages related to a Concurrent Transfer of Servicing For Sellers that have obtained Freddie Mac’s prior written approval, Concurrent Transfers of Servicing involving CHOICERenovation In Progress Mortgages are permitted, provided the following requirements are met. (See this Section 4607.17(b) regarding Subsequent Transfers of Servicing involving such CHOICERenovation Mortgages and Transfers of Servicing involving CHOICEReno eXPress® Mortgages.) Consistent with Sections 7101.3(c) through 7101.3(f), the Seller, as Transferor Servicer, remains jointly liable with the Transferee Servicer for all selling representation and warranty obligations, including obligations in this Chapter 4607 related to the completion of the renovations, even if such obligations are performed after the Effective Date of Transfer. This includes, but is not limited to, ensuring completion of all renovations and delivering through Loan Status Hub® the required notice and documentation to support completion of the renovations in accordance with the Seller responsibilities in Section 4607.9(c) and fulfilling the recourse obligation in the event that Freddie Mac does not approve removal of recourse pursuant to Section 4607.14. In addition to the requirements governing Concurrent Transfers of Servicing in the Guide, the Transferor Servicer must inform the Transferee Servicer whether the Transfer of Servicing involves CHOICERenovation In Progress Mortgages and must provide a list of such Mortgages (identified, at a minimum, by Transferor Servicer loan number and Freddie Mac loan number) to the Transferee Servicer. A Transferee Servicer may engage an Outsourced Vendor or Servicing Agent, which may be the Seller, to perform some or all of the activities set forth in Section 4607.9(d). The Transferee Servicer must have in place appropriate processes and communication protocols with any Outsourced Vendor or Servicing Agent it engages to perform the obligations in this Chapter 4607 related to the completion of the renovations, including, but not limited to: ■ Requiring that any remaining funds in the Custodial Account for Renovation Funds (as described in Section 4607.12) to be remitted to the Servicer to be applied to reduce the UPB or returned to the Borrower, as applicable, in accordance with Section 4607.11(c). The Servicer may outsource the opening and ongoing maintenance of the Custodial Account for Renovation Funds only to its Servicing Agent, if applicable. An Outsourced Vendor may be an authorized party to the account’s signature card and act as an agent of the primary account holder (either the Servicer or Servicing Agent, as applicable). ■ Notifying the Outsourced Vendor of any defaults related to the CHOICERenovation Mortgage and ensuring appropriate actions are being taken, such as: ❑ Relaying adverse information related to the Mortgaged Premises ❑ If the CHOICERenovation Mortgage is delinquent, applying any unused funds in accordance with the application of payment requirements in the Note and Security Instrument (see Section 4607.11(c)) ■ Notifying Freddie Mac in accordance with Section 1301.2(b) and the Outsourced Vendor if the Servicer or its Servicing Agent, if any, determines the Borrower was added to the Office of Foreign Assets Control Specially Designated Nationals list ■ Requiring any Mortgage proceeds allocated to make monthly payments of principal, interest, taxes and insurance pursuant to Section 4607.6(a) to be remitted from the Custodial Account for Renovation Funds to the Servicer in a timely manner for posting to the Borrower’s Mortgage account ■ Providing to the Servicer for inclusion in the Mortgage file all documentation maintained by any Outsourced Vendor related to the completion of renovations as required by this ■ Enforcing the property insurance requirements in Section 4607.13 (b) Prohibited Transfers of Servicing The following Transfers of Servicing involving CHOICERenovation Mortgages are prohibited: ■ Subsequent Transfers of Servicing involving CHOICERenovation In Progress Mortgages are prohibited until all renovations have been completed, the Seller has obtained a completion report pursuant to the appraisal requirements in Section 4607.8, Freddie Mac has acknowledged completion of the renovations pursuant to Section 4607.9(c) and Freddie Mac has approved the removal of recourse pursuant to Section 4607.14. (See Chapter 7101 regarding Transfers of Servicing.) ■ Transfers of Servicing involving CHOICEReno eXPress Mortgages are prohibited until all renovations have been completed and the Seller has obtained a completion report pursuant to the appraisal requirements in Section 4607.8 CHOICERenovation In Progress Mortgages and CHOICEReno eXPress Mortgages may not be sold through Cash-Released XChange®. Additionally, CHOICEReno eXPress Mortgages may not be involved in any other Concurrent Transfers of Servicing.

Source: Freddie Mac Single-Family Seller/Servicer Guide 4607.17 — Transfers of Servicing for CHOICERenovation® Mortgages · source URL · snapshot 4c94f67729042dd6