Cash Payups for Mortgages with Specified Characteristics FAQ
What products are eligible for cash-specified payups?
The payups apply to 30-yr, 20-yr, 15-yr, and 10-yr conventional fixed-rate mortgages that meet the specified characteristic requirements.
To find out which cash-specified payup types are eligible for each product, please view the Request Freddie Mac Price Sheet screen in Loan Selling Advisor®.
How do we complete the cash-specified payup transactions in Loan Selling Advisor®?
Use the fields "Cash Specified Pool Indicator" and "Cash Specified Pool Type" when taking out a contract in Loan Selling Advisor and simply allocate your eligible loans in the same way you do with other loans you sell. If a mortgage does not meet the Cash Specified Pool Type requirements for the applicable Cash Contract, you won’t be able to allocate the mortgage to the contract.
Does the cash-specified payup offering apply to both mandatory and best efforts contracts?
Yes, payups apply to mortgages sold under mandatory and best efforts contracts.
Can I deliver a mortgage with an original Note amount smaller than the original contract?
Yes, but the payup you'll receive for this mortgage will be calculated based on the LLB specified contract under which you have allocated the loan. For example, a mortgage with an original Note amount of $75,000 allocated to a $110,000 specified contract will receive the payup associated with that contract.
Do I need to use the Cash Specified Pool Type field in Loan Selling Advisor for all super conforming mortgages I sell to Freddie Mac?
No, you only need to select this option when you have exceeded the threshold for cash super conforming deliveries to Freddie Mac in a given month. Super conforming mortgages sold within the monthly threshold are committed as non-specified cash contracts where you select “No” in the Cash Specified Pool Indicator field in Loan Selling Advisor®. Once beyond the threshold, super conforming mortgages should only be committed by selecting “Yes” in the Cash Specified Pool Indicator field and “Super Conforming” in the Cash Specified Pool Type field in Loan Selling Advisor. The applicable super conforming price adjustment is included within the note rate level pricing in Loan Selling Advisor.
Will I be charged a pair-off fee if I take out the wrong Cash Specified Pool Type? How are pair-off fees calculated on these contracts?
Yes, for the mandatory execution path, pair-off fees may be charged if you incorrectly select a Cash Specified Pool Type and are unable to allocate a loan to deliver in that contract. Pair-off fees will be calculated in the same manner used for standard cash contracts. It is important you select the correct Cash Specified Pool Type for the mortgages you are delivering to avoid paying pair-off fees.
When will I see the final adjusted price on my cash-specified loan/contract?
The value of the cash-specified payup is included in the contract level prices on the price results and contract details screens when taking out a contract.
How long can I take out a contract for and still receive a payup?
Payups will be applied to the full commitment periods including the duration of any extensions.
Are there going to be additional characteristics Freddie Mac will pay up for?
We continue to monitor market trends and regularly review ways where we can expand opportunities for your business. We will communicate any additional payup opportunities with our customers.
How do I know if a loan qualifies for a Green cash-specified payup?
Loans qualify for the “Green” payup type if they meet one of the following criteria:
- GreenCHOICE Mortgages® plus solar panels – loan must be delivered with ULDD Data Point Loan Program Identifier of “GreenCHOICEToPayOffOutstandingEnergyDebt’ and ULDD Data Point Renewable Energy Component Type of “Solar”
- New construction with Home Energy Rating System (HERS) score less than or equal to 60 (from RESNET) – loan must be delivered with an IFI value of “J99.”
- New construction with solar panels – loan must be delivered with an IFI value of “J98.”
Originally Published: April 2019
Last Updated: 5/17/2023