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Construction Conversion MortgagesEnhancing your opportunities to meet your borrowers' construction conversion financing needs

Expand permanent financing opportunities for more of your borrowers with our Construction Conversion Mortgages for new site-built and manufactured homes – a component of our Mortgages for Newly Constructed Homes offering. Construction Conversion Mortgages offer you and your borrowers greater flexibility, including permitting 18 months between the date of the earliest credit, capacity or collateral document and the settlement date – allowing for longer construction times.

With Construction Conversion Mortgages, you can continue to take advantage of a variety of competitive sale execution options for the loans you process as purchase transactions. Plus, you can also sell to Freddie Mac the loans you process as no-cash out; and cash-out refinances (site-built only).

Product Features

Feature	Description
Property Type	Newly built or constructed 1- to 4-unit site-built homes Newly purchased 1unit manufactured homes that never have been attached to a foundation Primary residence Investment property Second homes
Eligible Mortgage Products	15-, 20- and 30- year fixed-rate mortgages Most ARMs eligible for sale to Freddie Mac 5- and 7-year balloon/reset mortgages (non-seasoned)
Transaction Type	Purchase No cash-out refinances Cash-out refinances (Site-built only)
Maximum LTV Ratios (without secondary financing)	Values used to determine LTV, TLTV, and HTLTV for Construction Conversion Mortgages are calculated according to the requirements in Section K33.12 of the Single-Family Seller/Servicer Guide.
Underwriting	Loan Prospector Mortgages Non-Loan Prospector Mortgages Minimum Indicator Score of 620 unless otherwise specified in the Guide All mortgages must meet the risk class and/or minimum Indicator Score requirements in Exhibit 25A, where applicable Maximum debt-to-income ratio of 45 percent for manually underwritten mortgages
Execution Options	Servicing-released Cash Servicing-retained Cash Fixed-rate Guarantor WAC ARM Guarantor Mortgages for Newly Constructed Homes, with a Settlement Date more 12 months after the Effective Date of Permanent Financing are not eligible for sale under MultiLender Swap
Delivery Fees	See Guide Exhibit 19 for details on applicable delivery fees.
Special Delivery Requirements	Special characteristics codes must be delivered on Form 11 or 13SF as applicable: see Guide Section 17.38.1 D51 and D69 – Construction Conversion/Renovation Mortgages - Site-built D52 – Construction Conversion Mortgages - Manufactured Home
Single-Family Seller/Servicer Guide	Find complete details on requirements for Mortgages for Newly Constructed Homes in Guide Chapter K33.

Download a Construction Conversion Mortgage factsheet for more details.

Lender Benefits

• Expanded options to drive more loan volume with Construction Conversion Mortgages available through the Single-Family Seller/Servicer Guide.
• New flexibility that matches your borrowers' needs and assists in Gulf Coast rebuilding. You now have 18 months to  process, underwrite, document, allow for construction and sell all Construction Conversion Mortgages – allowing for longer construction times to streamline the loan origination process for you and your borrowers.
• Enhanced niche-marketing opportunities to meet your borrowers' needs when you process many of our other popular, low downpayment mortgages as Construction Conversion Mortgages.

Benefits for Your Borrowers

• Mortgage options that meet your borrower's needs. Offer the financing flexibilities your borrowers need when you combine construction conversion mortgages with many other Freddie Mac products, including low down payment mortgages.
• A more flexible, streamlined loan origination process whether your borrower's Construction Conversion Mortgage is a purchase or refinance transaction.

Get More Information

• Call your Freddie Mac representative
• Download a Construction Conversion Mortgage factsheet

Training Opportunities

Visit The Learning Center for live and recorded web conferences, access to classroom-style workshops and self-study tools – all designed to help you stay competitive, serve more borrowers and make it easier to do business with us.

The information in this document is not a replacement or substitute for information found in the Single-Family Seller/Servicer Guide and/or the terms of your Master Agreement and/or Master Commitment.