By The Single-Family Team, Freddie Mac

Freddie Mac uses a Voluntary Partial Cancellation (VPC) process to cancel servicing rights on a pool of targeted loans on our balance sheet, so servicing can be transferred from a Transferor Servicer to a Transferee Servicer in support of borrower and balance sheet management objectives. Currently, loans that fall into this category have been identified manually—but that’s changing.

Starting March 28, 2025, Freddie Mac will automate the steps to identify loans that are eligible for a VPC transfer by integrating them into Servicing Transfer Manager, the Freddie Mac GatewaySM tool that identifies and submits subsequent Transfer of Servicing (STOS) requests. This change may help mitigate risk and add efficiency by eliminating the multiple steps, back and forth emails and an external tool to populate and scrub the loans.

The first version of this automation will focus on creating functionality for flow transfers. To accomplish this enhancement, Freddie Mac is adding a VPC Eligibility tab to Servicing Transfer Manager and creating standard or customized profiles for the 11 impacted participants.

Once the new functionality is implemented in Servicing Transfer Manager, Servicers will see exclusions and VPC-eligible loans and can export a Flow Report. For each loan, Servicers will designate with a “Y” or an “N” if the servicing of the loan should be transferred, along with any exclusion reasoning, and then upload the completed file for submission.

The automation offers several key benefits, including:

  • Reduction in manual emails
  • Ability to create multiple STOS-VPC transfers in Servicing Transfer Manager
  • Increased efficiency with eligible loans available earlier in the process
  • Automated reminders to submit loans
  • Transparency into Freddie Mac’s loan data
  • Expected pricing at time of transfer
  • Access to executed agreements

The first step towards Freddie Mac’s VPC automation is for Access Manager administrators to provide impacted Servicers access to a new role in Servicing Transfer Manager called “VPC External Read Only” by March 14, 2025. To prepare users for the new VPC functionality, there will be upcoming Information sessions and an online help tool available on March 28 outlining how to use the new features. Afterwards, based on readiness, Servicers need to switch from the read-only role to the required VPC External Analyst role, depending on the timeline for loans being transferred; upcoming communications will outline this process in more detail.

For more information, Servicers can reach out to their Freddie Mac representative or the Customer Support Contact Center (800-FREDDIE).