ACE+ PDR (automated collateral evaluation plus property data report) offers lenders another option – to originate loans they intend to sell to Freddie Mac without a traditional appraisal. It’s one in a spectrum of collateral valuation options – providing lenders and borrowers cost and time savings while maintaining the highest standards of risk management.
ACE+ PDR was introduced in 2022, and we’ve continued to make enhancements since then, from expanding eligibility to establishing a joint-GSE (government sponsored enterprise) dataset – the Uniform Property Dataset (UPD) – and introducing bACE API (Beyond ACE application programming interface) to simplify the PDR submission process.
The latest enhancement adds new feedback messaging to Loan Product Advisor® (LPASM) and corresponding messaging to bACE API which are intended to provide lenders greater clarity around:
- Property eligibility
- Eligibility for collateral representation and warranty (R&W) relief
- Inspections and upgrades to hybrid or traditional appraisals when there are required repairs.
The following Q&A provides additional information intended to help lenders identify ways to update their processes, more effectively use these new messages and get the most out of ACE+ PDR.
Q: Why were these new feedback messages added to LPA?
A: To provide greater clarity around property eligibility, eligibility for collateral R&W relief and next steps when there are required repairs, inspections or upgrades to hybrid or traditional appraisals. With the implementation of the UPD and the requirement to submit PDRs to bACE API, these messages provide notification of eligibility for collateral R&W relief based upon a successful submission to bACE API. They also notify users that collateral R&W relief isn’t offered after submission of a PDR results in the need to upgrade to a hybrid or traditional appraisal.
Q: How might these messages change a lender’s process?
A: First, it’s a requirement (see Single-Family Seller/Servicer Guide (Guide) Bulletin 2023-19) that ACE+ PDR loans be resubmitted to LPA after a PDR is submitted to bACE API. With the new feedback messages, if a loan is submitted to LPA before a PDR is submitted to bACE API, lenders receive a message reminding them that a successful submission to bACE API is required.
Second, these messages can assist lenders in their review of PDRs. While lenders are always required to thoroughly review PDRs to determine whether the subject property meets Guide ACE+ PDR eligibility requirements and the loan is eligible for sale to Freddie Mac, these messages can help identify whether an upgrade to a hybrid or traditional appraisal is required. After submitting the PDR to bACE API, if an upgrade is required, the next submission to LPA will return feedback messages reminding the lender that an upgrade is required.
Lastly, these messages alert lenders when there’s additional feedback that may need to be addressed. Lenders can look to build in checks for this messaging to identify issues earlier on and make their processes more efficient.
Q: What additional information/feedback will be provided in bACE API messaging?
A: This messaging offers more detail about the subject property and alerts lenders to things like adverse site conditions, missing utilities or a lack of adequate access for all seasons. These messages may aid lenders in their review of PDRs to identify potential issues that need to be addressed.
The messaging also highlights the need for repairs or inspections so lenders can more quickly and easily decide on next steps.
Q: Are there resources that can help lenders leverage the LPA messages and understand how the messages might impact their processes?
A: Yes. Our ACE+ PDR At-A-Glance Job Aid offers more detail about the feedback messages and illustrates, based on different scenarios and outcomes of PDR submissions to bACE API, results the LPA feedback certificate will display and messages LPA will return.
For more information about ACE+ PDR, visit our dedicated webpage or our FAQs. If you’re looking for a PDR provider, check out our provider list and what they offer.