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Streamlined Modification Program

Important Update: On March 4, 2009, the Administration announced a new loan modification initiative, the Home Affordable Modification Program. With this announcement, Servicers should no longer accept new applications for mortgage modifications under the Streamlined Modification Program. Servicers should also no longer solicit borrowers for a modification under the Streamlined Modification Program, and should instead begin to solicit eligible delinquent borrowers who are 31 or more days delinquent for a modification under the Home Affordable Modification Program.

Background

On November 11, 2008, Freddie Mac joined with the Federal Housing Finance Agency (FHFA), Fannie Mae, and members of the HOPE NOW Alliance to announce the Streamlined Modification Program. The Streamlined Modification Program alleviates some of the most labor-intensive and time-consuming components of a traditional loan modification by standardizing the modification criteria for mortgages owned by either Freddie Mac or Fannie Mae.

Our December 12, 2008 Single-Family Seller/Servicer Guide (Guide) Bulletin provided requirements for Servicers to implement, underwrite and service eligible Freddie Mac-owned mortgages under the Streamlined Modification Program. Our January 9, 2009 Guide Bulletin provides additional requirements and documentation to implement the program for mortgages with an interest rate change (e.g., adjustable-rate mortgage) or payment adjustment occurring during the program’s three-month trial period. We urge Servicers to thoroughly review these Bulletins for complete requirements as they continue to service modifications for borrowers engaged in a modification under the Streamlined Modification Program.

As noted in the Bulletins, Servicers should deploy Streamlined Modification Program documentation when completing a modification after the initial trial payment period. These documents are available for Servicers to download now. Servicers may download the Freddie Mac logo to co-brand envelopes and packages from this link. Servicers may not use Freddie Mac's logo without also including its own logo and any other disclosures required by applicable federal, State, or local law (e.g., equal housing lender logo).

It is important that you review the Bulletin for special requirements for income, collateral, escrows, credit enhancements and the trial period.

Reporting and Remitting

During the required three-month trial period, the borrower must make three payments at the modified terms. The reporting section of the December 12 Bulletin provides the details and requirements for reporting and remitting to Freddie Mac during the trial period, following a successful trial period, and following an unsuccessful workout during the trial period. Servicers should consult their mortgage insurance providers for specific processes related to the reporting of modified terms, payment of premiums, payment of claims, and other operational matters in connection with privately insured mortgage loans modified under the Streamlined Modification Program.

Additional Servicing Guidance

Review the Bulletin for additional information on compensation, fees and required documentation.

Resources for Servicers

Access to Secured Tools

  • You will need your Mortgage Servicing Products ID and password to access these secured materials. This is the same ID and password you use to access your Servicer Performance Profile and secured training materials on our Learning Center.
  • Servicing Applications Sign Up Form – Request access to our Streamlined Modification Program secured materials.

Resources for Servicers

Use your Mortgage Servicing Products ID to login. More information about gaining access to secured tools.

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© 2010 Freddie Mac

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