Policy updates issued by the Federal Home Loan Mortgage Corp. impact mortgage fraud reporting, large deposits and the use of a power of attorney.
When outside individuals and entities handle the functions of seller-servicer employees who are in a position to recognize or report suspected or actual fraud, then those individuals and entities are required to receive fraud training.
The training can be provided by the seller-servicer or another outside party. The seller-servicer can also be provided with an annual written verification confirming that the training, as required by Freddie, has already been received.
The requirement takes effect next year.
The McLean, VA.-based company discussed the updates in Bulletin 2014-12.
Freddie said it is extending the amount of time seller-servicers have to report suspected or actual fraud from 30 days to 60 days.
The secondary lender is easing its requirements on large deposits. Loan applicants had been required to document any single deposits that exceeded 25 percent of total monthly qualifying income.
Now, Freddie will only require documentation when the deposit amount is 50 percent of income. In addition, deposits will only need to be verified on purchase transactions where the deposit is needed to meet the requirements for borrowers funds or reserves.
Freddie said it is revising its requirements to allow the use of a power of attorney when the lender determines that applicable law requires it. The determination must be documented with a written statement delivered to the document custodian with the note.
Anyone who serves as an attorney-in-fact cannot be affiliated with any party to a loan transaction except the borrower.
Other minor policy changes addressed in Bulletin 2014-12 impact adjustable-rate mortgages with lookback periods less than 45 days, MERS requirements, cashout limitations on Relief Refinance Mortgages, debt payment-to-income ratio requirements, area median income estimates for 2014, the Loan Quality Advisor Agreement, and loan data required for all mortgages.
