Freddie Mac Single-Family Seller/Servicer Guide 6101.2 — Fixed-rate Cash Contracts

This section contains requirements related to: ■ Mandatory fixed-rate Cash Contracts ■ Best Efforts fixed-rate Cash Contracts ■ Certain negotiated pricing under Fixed-rate Cash

(a) Mandatory fixed-rate Cash Contracts (i) Offer amounts and procedures for Mandatory Cash Contracts Each Business Day, the Seller may take out Mandatory Cash Contracts to sell one or more Mortgages. Freddie Mac will endeavor to announce prior to the offer day if commitments will not be available due to holidays or other reasons. The minimum amount for an individual Mandatory Cash Contract is $1,000. Freddie Mac may, at its discretion and at any time, impose a maximum contract amount for individual Mandatory Cash Contracts. The Seller may enter into multiple mandatory cash contracts but may not exceed $200 million in aggregate fixed-rate and WAC ARM (see Section 6102.2(a)) commitment volume per day. The Seller may seek an exception to this amount by contacting the Cash Desk ([email protected] or 571-382-5960). Note: If this limit is exceeded without prior Freddie Mac approval, Freddie Mac may pair off the Seller’s contract(s) or may require the Seller to pair off the contract(s) at the Seller’s expense. (ii) Seller obligations for Mandatory Cash Contracts Under a Mandatory Cash Contract, the Seller must: ■ Sell to Freddie Mac one or more Mortgages that meet all of the contract requirements and have an aggregate UPB equal to the contract amount, subject to the purchase tolerance applicable to cash contracts under Section 6401.1 ■ Complete all requirements for the sale of the Mortgages by the close of business on the Purchase Contract Expiration Date The terms of the Purchase Contract are provided in Loan Selling Advisor® and made available in Loan Selling Advisor’s Purchase Contract Confirmation. (iii)Contract periods for Mandatory Cash Contracts In Loan Selling Advisor, the Purchase Contract Effective Period is the period of time for which a price for eligible Mortgages provided to the Seller by Loan Selling Advisor is effective. The Seller may select a Purchase Contract Effective Period of between two and 90 days or such other time frame as permitted by Loan Selling Advisor. All of the requirements for all Mortgages under the contract must be completed by the Purchase Contract Expiration Date. (iv) Pricing for Mandatory Cash Contracts Pricing is available in Loan Selling Advisor each Business Day and is based on prices Freddie Mac expects to receive in the securities market for the related UMBS® or MBS. The price also reflects the Mortgage Note Rate, the Minimum Contract Servicing Spread and the delivery period. Freddie Mac will update prices on active Mortgage coupons throughout the day to reflect movements in the securities market. Posted prices assume a 0.250% Minimum Contract Servicing Spread and the use of the Standard Remittance Cycle. The contract price the Seller receives through Loan Selling Advisor may be adjusted as the Seller allocates Mortgages to the contract or provides more detailed Mortgage data. The Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s sale of a Mortgage that Freddie Mac priced and purchased under a Mandatory Cash Contract based on incomplete and/or inaccurate Mortgage data provided by the Seller for which Freddie Mac would have provided a different price if the Mortgage data provided by the Seller had been complete and accurate. Once the Seller has accepted and agreed to the contract price provided by Freddie Mac, there is a binding commitment by Freddie Mac to purchase, and by the Seller to sell, Mortgages under the contract terms (subject to the conformity of each Mortgage to the requirements of the Purchase Documents). (v) Specified payups for Mandatory Cash Contracts For Mortgages with certain attributes, the Seller may be eligible to receive specified payups to standard cash pricing. The contract must be a 10-, 15-, 20- or 30-year mandatory fixed-rate contract. The cash payups are eligible for full commitment periods including extensions. All Mortgages within the contract must meet the requirements of the payup. Otherwise, the Seller will not be able to allocate the Mortgage to the contract. Mortgage characteristics that are eligible for specified payups are available in Loan Selling Advisor. Super conforming Mortgages sold under 100% super conforming Cash Contracts may be subject to price adjustments. See Chapter 4603 for special eligibility requirements for super conforming Mortgages. See Section 6302.31 for delivery requirements for fixedrate Cash Contracts for super conforming Mortgages. For more details: go to https://sf.freddiemac.com/working-with-us/sellingdelivery/delivery-options-pricing/cash-payups. (vi) Pairoff process for Mandatory Cash Contracts In the event the contract amount will not be fulfilled by delivery of Mortgages, the Seller may request a pairoff via Loan Selling Advisor or may wait until the contract expires and Loan Selling Advisor automatically calculates the pairoff fee. The pairoff process used in Loan Selling Advisor is “two-way” and may result in either a fee due Freddie Mac from the Seller or a fee due the Seller from Freddie Mac, depending on market conditions. The Seller may also choose to allocate Mortgages to “pair off and transfer to a new contract” (or pair off and recommit). With this functionality, the Seller may: ■ Pair off part or all of a current contract ■ Take out a new contract with different terms and/or a different amount ■ Transfer non-funded loans to a new contract to extend the Purchase Contract Effective Period or increase the Purchase Contract amount A pairoff fee calculated and provided by Loan Selling Advisor is non-negotiable. Freddie Mac reserves the right to amend the provisions of this section or Section 6401.1 relating to the Loan Selling Advisor pairoff process without prior notice. (vii) Mandatory Cash Contract extensions In the event the contract amount specified in a Mandatory Cash Contract will not be fulfilled on or prior to the Purchase Contract Expiration Date, the Seller may extend, in Loan Selling Advisor, the Mandatory Cash Contract at any time on or prior to 5:00 p.m. Eastern time on the Purchase Contract Expiration Date. The Seller may extend the contract an unlimited number of times, as long as the total extension period plus the original contract term does not exceed 120 days and each extension is less than 90 days beyond the current date. In exchange for the contract extension, the Seller will be assessed a fee to be paid in accordance with Section 6303.2(a).

(b) Best Efforts fixed-rate Cash Contracts (i) Offer amounts and procedures for Best Efforts Cash Contracts Each Business Day, the Seller may take out a Best Effort Contract to sell a specific fixedrate Mortgage. Freddie Mac will endeavor to announce prior to the offer day if commitments will not be available due to holidays or other reasons. The minimum amount for an individual Best Efforts Contract is $1,000. Freddie Mac may, at its discretion and at any time, impose a maximum contract amount for Best Efforts Cash Contracts. (ii) Seller obligations for Best Efforts Cash Contracts Under a Best Efforts Contract, the Seller must: ■ Use its best efforts to close and fund a specified Mortgage ■ Sell the Mortgage to Freddie Mac, at a cash price determined by Freddie Mac, if the Mortgage with the same Borrower(s) and property address is closed and funded ■ With respect to Mortgages sold under a Best Efforts Contract, no later than close of business on the Business Day following the day on which the Seller denies the Borrower’s Mortgage application or the Borrower exercises his/her right of rescission, notify Freddie Mac of the change in the Mortgage application status or the rescission, as applicable, via Loan Selling Advisor (also known as “Withdraw Loan” status). Such notification must occur within the Purchase Contract Effective Period. The terms of the Purchase Contract are provided in Loan Selling Advisor. (iii)Contract periods for Best Efforts Contracts In Loan Selling Advisor, the Purchase Contract Effective Period is the period of time for which a price for eligible Mortgages provided to the Seller by Loan Selling Advisor is effective. The Seller may select a Purchase Contract Effective Period of between two and 90 days or such other time frame as permitted by Loan Selling Advisor. All of the requirements for the specified Mortgage under the contract must be completed by the Purchase Contract Expiration Date. If the Mortgage specified under a Best Efforts Contract closes and funds after the Best Efforts Contract expires, the Seller remains obligated to sell the Mortgage to Freddie Mac under that same Best Efforts Contract. See Section 6101.2(b)(iv) below for the impact on pricing of selling a Mortgage under a Best Efforts Contract that has expired. If, despite the Seller’s best efforts, the Mortgage is not closed and funded, the Seller will not be assessed a pairoff fee. The Seller may substitute a different loan to fulfill this contract. Pricing adjustments may apply. See Section 6101.2(b)(iv) for Best Efforts Contracts. However, the Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s failure to sell a Mortgage to Freddie Mac that is closed and funded by the Seller. Furthermore, the Seller may not: ■ Substitute a Mortgage with a different Borrower(s) or a different property address for the Mortgage specified in the Best Efforts Contract ■ Take out another Best Efforts Contract or a Mandatory Cash Contract, either sequentially or at the same time, for the same Mortgage ■ Take out a Best Efforts Contract with fictitious Borrower data or a fictitious property address ■ Sell a Mortgage specified in a Best Efforts Contract to another investor If the Seller fails to comply with the requirements specified above, Freddie Mac may immediately terminate the Seller’s eligibility to sell under a Best Efforts Contract. (iv) Pricing for Best Efforts Cash Contracts Pricing is available in Loan Selling Advisor each Business Day and is based on prices Freddie Mac expects to receive in the securities market for the related UMBS or MBS. The price also reflects the Mortgage Note Rate, the Minimum Contract Servicing Spread, the delivery period and the cost that Freddie Mac incurs for managing interest rate risk on behalf of the Seller. Freddie Mac will update prices on active Mortgage coupons throughout the day to reflect movements in the securities market. Posted prices assume a 0.250% (25 basis point) Minimum Contract Servicing Spread and the use of the Standard Remittance Cycle. Among other considerations, Freddie Mac will consider the Seller’s success rate, under prevailing market conditions, in closing Mortgages that are allocated to Best Efforts Contracts. A Mortgage that fails to fund and close as specified in the Best Efforts Contract may adversely affect the Seller’s pricing for future Best Efforts Contracts. For Mortgages allocated to Best Efforts Contracts, if any of the characteristics change, the Seller must modify the Mortgage data. Example: If the Borrower switches from a 30-year fixed-rate Mortgage to a 15-year fixed-rate Mortgage, the Mortgage data must be modified without allocating the Mortgage to a new Best Efforts Contract. The contract will be re-priced using the prices in effect as of the date that the Seller originally accepted the Best Efforts Contract price. In addition, if the Seller sells a Mortgage that has closed and funded after a Best Efforts Contract has expired, Freddie Mac will determine the price for that Mortgage at the time of sale. The Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s sale of a Mortgage that Freddie Mac priced and purchased under a Best Efforts Contract based on incomplete and/or inaccurate Mortgage data provided by the Seller, for which Freddie Mac would have provided a different price if the Mortgage data provided by the Seller had been complete and accurate. (v) Specified payups for Best Efforts Cash Contracts For Mortgages with certain attributes, Sellers may be eligible to receive specified payups to standard cash pricing. The contract must be a 10-, 15-, 20- or 30-year Best Efforts fixed-rate contract. The cash payups are eligible for full commitment periods, including extensions. All Mortgages within the contract must meet the requirements of the payups. If a Mortgage does not meet the requirements for the applicable Cash Contract, the Seller will not be able to allocate the Mortgage to the contract. Mortgage characteristics that are eligible for specified payups are available in Loan Selling Advisor. (vi) Best Efforts Cash Contract extensions In the event the Mortgage specified in a Best Efforts Contract will not close prior to the Purchase Contract Expiration Date, the Seller may extend, in Loan Selling Advisor, the Best Efforts Contract at any time prior to the Purchase Contract Expiration Date. The Seller may extend the contract an unlimited number of times, as long as the total extension period plus the original contract term does not exceed 120 days and each extension is less than 90 days beyond the current date. In exchange for the contract extension, the Seller will be assessed a fee, to be paid in accordance with Section 6303.2(a).

(c) Certain negotiated pricing under Fixed-rate Cash Freddie Mac may, from time to time, assess certain negotiated Credit Fees. Any such pricing will be made available to the Seller on the cash Purchase Contract loan-level fee breakdown screen in Loan Selling Advisor. In addition to the provisions of Section 1101.2(a)(ii), Freddie Mac may amend, supplement, revise or terminate any of the pricing or provisions implemented pursuant to this section in whole or in part, upon written notice to the Seller.

■ Mandatory fixed-rate Cash Contracts ■ Best Efforts fixed-rate Cash Contracts ■ Certain negotiated pricing under Fixed-rate Cash

(a) Mandatory fixed-rate Cash Contracts (i) Offer amounts and procedures for Mandatory Cash Contracts Each Business Day, the Seller may take out Mandatory Cash Contracts to sell one or more Mortgages. Freddie Mac will endeavor to announce prior to the offer day if commitments will not be available due to holidays or other reasons. The minimum amount for an individual Mandatory Cash Contract is $1,000. Freddie Mac may, at its discretion and at any time, impose a maximum contract amount for individual Mandatory Cash Contracts. The Seller may enter into multiple mandatory cash contracts but may not exceed $200 million in aggregate fixed-rate and WAC ARM (see Section 6102.2(a)) commitment volume per day. The Seller may seek an exception to this amount by contacting the Cash Desk ([email protected] or 571-382-5960). Note: If this limit is exceeded without prior Freddie Mac approval, Freddie Mac may pair off the Seller’s contract(s) or may require the Seller to pair off the contract(s) at the Seller’s expense. (ii) Seller obligations for Mandatory Cash Contracts Under a Mandatory Cash Contract, the Seller must: ■ Sell to Freddie Mac one or more Mortgages that meet all of the contract requirements and have an aggregate UPB equal to the contract amount, subject to the purchase tolerance applicable to cash contracts under Section 6401.1 ■ Complete all requirements for the sale of the Mortgages by the close of business on the Purchase Contract Expiration Date The terms of the Purchase Contract are provided in Loan Selling Advisor® and made available in Loan Selling Advisor’s Purchase Contract Confirmation. (iii)Contract periods for Mandatory Cash Contracts In Loan Selling Advisor, the Purchase Contract Effective Period is the period of time for which a price for eligible Mortgages provided to the Seller by Loan Selling Advisor is effective. The Seller may select a Purchase Contract Effective Period of between two and 90 days or such other time frame as permitted by Loan Selling Advisor. All of the requirements for all Mortgages under the contract must be completed by the Purchase Contract Expiration Date. (iv) Pricing for Mandatory Cash Contracts Pricing is available in Loan Selling Advisor each Business Day and is based on prices Freddie Mac expects to receive in the securities market for the related UMBS® or MBS. The price also reflects the Mortgage Note Rate, the Minimum Contract Servicing Spread and the delivery period. Freddie Mac will update prices on active Mortgage coupons throughout the day to reflect movements in the securities market. Posted prices assume a 0.250% Minimum Contract Servicing Spread and the use of the Standard Remittance Cycle. The contract price the Seller receives through Loan Selling Advisor may be adjusted as the Seller allocates Mortgages to the contract or provides more detailed Mortgage data. The Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s sale of a Mortgage that Freddie Mac priced and purchased under a Mandatory Cash Contract based on incomplete and/or inaccurate Mortgage data provided by the Seller for which Freddie Mac would have provided a different price if the Mortgage data provided by the Seller had been complete and accurate. Once the Seller has accepted and agreed to the contract price provided by Freddie Mac, there is a binding commitment by Freddie Mac to purchase, and by the Seller to sell, Mortgages under the contract terms (subject to the conformity of each Mortgage to the requirements of the Purchase Documents). (v) Specified payups for Mandatory Cash Contracts For Mortgages with certain attributes, the Seller may be eligible to receive specified payups to standard cash pricing. The contract must be a 10-, 15-, 20- or 30-year mandatory fixed-rate contract. The cash payups are eligible for full commitment periods including extensions. All Mortgages within the contract must meet the requirements of the payup. Otherwise, the Seller will not be able to allocate the Mortgage to the contract. Mortgage characteristics that are eligible for specified payups are available in Loan Selling Advisor. Super conforming Mortgages sold under 100% super conforming Cash Contracts may be subject to price adjustments. See Chapter 4603 for special eligibility requirements for super conforming Mortgages. See Section 6302.31 for delivery requirements for fixedrate Cash Contracts for super conforming Mortgages. For more details: go to https://sf.freddiemac.com/working-with-us/sellingdelivery/delivery-options-pricing/cash-payups. (vi) Pairoff process for Mandatory Cash Contracts In the event the contract amount will not be fulfilled by delivery of Mortgages, the Seller may request a pairoff via Loan Selling Advisor or may wait until the contract expires and Loan Selling Advisor automatically calculates the pairoff fee. The pairoff process used in Loan Selling Advisor is “two-way” and may result in either a fee due Freddie Mac from the Seller or a fee due the Seller from Freddie Mac, depending on market conditions. The Seller may also choose to allocate Mortgages to “pair off and transfer to a new contract” (or pair off and recommit). With this functionality, the Seller may: ■ Pair off part or all of a current contract ■ Take out a new contract with different terms and/or a different amount ■ Transfer non-funded loans to a new contract to extend the Purchase Contract Effective Period or increase the Purchase Contract amount A pairoff fee calculated and provided by Loan Selling Advisor is non-negotiable. Freddie Mac reserves the right to amend the provisions of this section or Section 6401.1 relating to the Loan Selling Advisor pairoff process without prior notice. (vii) Mandatory Cash Contract extensions In the event the contract amount specified in a Mandatory Cash Contract will not be fulfilled on or prior to the Purchase Contract Expiration Date, the Seller may extend, in Loan Selling Advisor, the Mandatory Cash Contract at any time on or prior to 5:00 p.m. Eastern time on the Purchase Contract Expiration Date. The Seller may extend the contract an unlimited number of times, as long as the total extension period plus the original contract term does not exceed 120 days and each extension is less than 60 days beyond the current date. In exchange for the contract extension, the Seller will be assessed a fee to be paid in accordance with Section 6303.2(a).

(b) Best Efforts fixed-rate Cash Contracts (i) Offer amounts and procedures for Best Efforts Cash Contracts Each Business Day, the Seller may take out a Best Effort Contract to sell a specific fixedrate Mortgage. Freddie Mac will endeavor to announce prior to the offer day if commitments will not be available due to holidays or other reasons. The minimum amount for an individual Best Efforts Contract is $1,000. Freddie Mac may, at its discretion and at any time, impose a maximum contract amount for Best Efforts Cash Contracts. (ii) Seller obligations for Best Efforts Cash Contracts Under a Best Efforts Contract, the Seller must: ■ Use its best efforts to close and fund a specified Mortgage ■ Sell the Mortgage to Freddie Mac, at a cash price determined by Freddie Mac, if the Mortgage with the same Borrower(s) and property address is closed and funded ■ With respect to Mortgages sold under a Best Efforts Contract, no later than close of business on the Business Day following the day on which the Seller denies the Borrower’s Mortgage application or the Borrower exercises his/her right of rescission, notify Freddie Mac of the change in the Mortgage application status or the rescission, as applicable, via Loan Selling Advisor (also known as “Withdraw Loan” status). Such notification must occur within the Purchase Contract Effective Period. The terms of the Purchase Contract are provided in Loan Selling Advisor. (iii)Contract periods for Best Efforts Contracts In Loan Selling Advisor, the Purchase Contract Effective Period is the period of time for which a price for eligible Mortgages provided to the Seller by Loan Selling Advisor is effective. The Seller may select a Purchase Contract Effective Period of between two and 90 days or such other time frame as permitted by Loan Selling Advisor. All of the requirements for the specified Mortgage under the contract must be completed by the Purchase Contract Expiration Date. If the Mortgage specified under a Best Efforts Contract closes and funds after the Best Efforts Contract expires, the Seller remains obligated to sell the Mortgage to Freddie Mac under that same Best Efforts Contract. See Section 6101.2(b)(iv) below for the impact on pricing of selling a Mortgage under a Best Efforts Contract that has expired. If, despite the Seller’s best efforts, the Mortgage is not closed and funded, the Seller will not be assessed a pairoff fee. The Seller may substitute a different loan to fulfill this contract. Pricing adjustments may apply. See Section 6101.2(b)(iv) for Best Efforts Contracts. However, the Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s failure to sell a Mortgage to Freddie Mac that is closed and funded by the Seller. Furthermore, the Seller may not: ■ Substitute a Mortgage with a different Borrower(s) or a different property address for the Mortgage specified in the Best Efforts Contract ■ Take out another Best Efforts Contract or a Mandatory Cash Contract, either sequentially or at the same time, for the same Mortgage ■ Take out a Best Efforts Contract with fictitious Borrower data or a fictitious property address ■ Sell a Mortgage specified in a Best Efforts Contract to another investor If the Seller fails to comply with the requirements specified above, Freddie Mac may immediately terminate the Seller’s eligibility to sell under a Best Efforts Contract. (iv) Pricing for Best Efforts Cash Contracts Pricing is available in Loan Selling Advisor each Business Day and is based on prices Freddie Mac expects to receive in the securities market for the related UMBS or MBS. The price also reflects the Mortgage Note Rate, the Minimum Contract Servicing Spread, the delivery period and the cost that Freddie Mac incurs for managing interest rate risk on behalf of the Seller. Freddie Mac will update prices on active Mortgage coupons throughout the day to reflect movements in the securities market. Posted prices assume a 0.250% (25 basis point) Minimum Contract Servicing Spread and the use of the Standard Remittance Cycle. Among other considerations, Freddie Mac will consider the Seller’s success rate, under prevailing market conditions, in closing Mortgages that are allocated to Best Efforts Contracts. A Mortgage that fails to fund and close as specified in the Best Efforts Contract may adversely affect the Seller’s pricing for future Best Efforts Contracts. For Mortgages allocated to Best Efforts Contracts, if any of the characteristics change, the Seller must modify the Mortgage data. Example: If the Borrower switches from a 30-year fixed-rate Mortgage to a 15-year fixed-rate Mortgage, the Mortgage data must be modified without allocating the Mortgage to a new Best Efforts Contract. The contract will be re-priced using the prices in effect as of the date that the Seller originally accepted the Best Efforts Contract price. In addition, if the Seller sells a Mortgage that has closed and funded after a Best Efforts Contract has expired, Freddie Mac will determine the price for that Mortgage at the time of sale. The Seller indemnifies Freddie Mac for any and all costs and expenses incurred by Freddie Mac as a result of the Seller’s sale of a Mortgage that Freddie Mac priced and purchased under a Best Efforts Contract based on incomplete and/or inaccurate Mortgage data provided by the Seller, for which Freddie Mac would have provided a different price if the Mortgage data provided by the Seller had been complete and accurate. (v) Specified payups for Best Efforts Cash Contracts For Mortgages with certain attributes, Sellers may be eligible to receive specified payups to standard cash pricing. The contract must be a 10-, 15-, 20- or 30-year Best Efforts fixed-rate contract. The cash payups are eligible for full commitment periods, including extensions. All Mortgages within the contract must meet the requirements of the payups. If a Mortgage does not meet the requirements for the applicable Cash Contract, the Seller will not be able to allocate the Mortgage to the contract. Mortgage characteristics that are eligible for specified payups are available in Loan Selling Advisor. (vi) Best Efforts Cash Contract extensions In the event the Mortgage specified in a Best Efforts Contract will not close prior to the Purchase Contract Expiration Date, the Seller may extend, in Loan Selling Advisor, the Best Efforts Contract at any time prior to the Purchase Contract Expiration Date. The Seller may extend the contract an unlimited number of times, as long as the total extension period plus the original contract term does not exceed 120 days and each extension is less than 60 days beyond the current date. In exchange for the contract extension, the Seller will be assessed a fee, to be paid in accordance with Section 6303.2(a).

(c) Certain negotiated pricing under Fixed-rate Cash Freddie Mac may, from time to time, assess certain negotiated Credit Fees. Any such pricing will be made available to the Seller on the cash Purchase Contract loan-level fee breakdown screen in Loan Selling Advisor. In addition to the provisions of Section 1101.2(a)(ii), Freddie Mac may amend, supplement, revise or terminate any of the pricing or provisions implemented pursuant to this section in whole or in part, upon written notice to the Seller.