Freddie Mac issued Selling Guide Bulletin 2023-24 on December 6, 2023, to announce recent changes to Selling Guide requirements, which include the following:
Conforming Loan Limits Increase for 2024
An increase to the baseline conforming loan limits and high-cost area loan limits was announced on November 28, 2023. The new values apply to loans with a settlement date of January 1, 2024 or later.
The increased loan limits reflect a 5.56% increase in housing prices from the previous year. For a one-unit property, the conforming loan limit increased from $726,150 to $766,550 for 2024. For additional information, click here to view DocMagic’s recent article.
Employed Income Documentation and Verification Requirements
Freddie Mac is updating the requirements for the 10-day pre-closing verification (“PVC”). Loans with a settlement date of March 6, 2024, or later will require a 10-day PVC including a year-to-date paystub with the “paid through” date no more than 15 business days prior to the note date for borrowers with an employment status of “employed.”
Cash-out Refinance Mortgage Occupancy Requirements
For new loans with a settlement date of March 6, 2024 or later, Freddie Mac has revised eligibility requirements for cash-out refinance loans secured by a primary residence.
As of the effective date, guidelines will require that all borrowers occupy the primary residence for a cash-out refinance loan. Current guidelines require a least one borrower to have been on title for at least six months prior to the note date with exceptions.
Condominium Projects
Beginning February 26, 2024, the Condo Project Advisor Project Assessment Request (“PAR”) is being updated to include a new status option of “Not Eligible” when a condominium project does not meet Freddie Mac project review and general eligibility requirements. Additionally, a new requirement is being added that mandates a seller or related third party to provide notice to Freddie Mac no later than five business days after becoming aware of any information that is inconsistent with a project’s PAR status.
Appraisals – Market Condition Adjustments
Guideline Section 5605.6(c) has been updated with examples of acceptable data sources that appraisers may use to support market condition adjustments and determine property value.
In addition to market data, which includes comparable listings and sales information, appraisers may also consider data from home price indices; multiple listing services; public records; and commercial services, models and data. Appraisers must include commentary describing the sources used in the market analysis portion of an appraisal.
Click here to view Freddie Mace Selling Guide Bulletin 2023-24
