HeritageOne^® FAQ

Freddie Mac made a commitment to develop a conventional mortgage product to support members of federally recognized Native American tribes in Indian country. HeritageOne is our solution to address the need for greater access to mortgage financing for these communities.

Freddie Mac provides two options for a federally recognized Native American tribe to be considered eligible:

1. The tribe is included in HUD’s most recent Section 184 Participating Tribes List.
2. The tribe has entered into a memorandum of understanding with Freddie Mac.
   1. If a Seller wishes to work with a tribe that is not on the HUD Section 184 Participating Tribes list, contact the Customer Support Contact Center (800-FREDDIE).

Lenders must have certain terms of business (TOBs) with Freddie Mac to sell HeritageOne mortgages to us. Contact your Freddie Mac account executive for additional information. If you don’t have an account executive, call the Customer Support Contact Center (800-FREDDIE) for information on how to apply.

No. Non-occupying borrowers are permitted on mortgages for 1-unit properties, including manufactured homes, so long as at least one borrower occupies the property as the primary residence. For 2- to 4-unit properties, though, all borrowers must occupy the property as their primary residence.

No, but at least one borrower must be an enrolled member of a federally recognized Native tribe who will occupy the property as the primary residence.

Note:  The borrower cannot be a Native tribe or its instrumentality.

Borrowers are not subject to maximum income limits.

No. For market areas without a sufficient number of comparable sales to develop a fully supported and sufficiently documented opinion of market value using the sales comparison approach, an appraisal that relies solely on the cost approach for the opinion of market value is acceptable, under certain conditions.

Gift or grant funds provided by the Seller as the originating lender are allowed, provided that a contribution of at least 3% of the property’s value (unless the property is a manufactured home which requires a 5% down payment) is made from borrower personal funds and/or other eligible sources of funds.

In addition to the borrower’s own funds, a borrower can receive assistance in reaching the minimum 3% down payment on a 1-unit property  from other eligible sources of funds, which include, but are not limited to, a related person, a governmental or non-governmental agency (including an agency that is a Native tribe or its instrumentality), an Employer Assisted Homeownership (EAH) program and Affordable Seconds^®. 

Note: The borrower is not required to use personal funds toward the 3% down payment for a 1-unit property. See Guide for additional information.

No. Down payment assistance can’t be funded through the mortgage transaction in any way, including through points, price, fees or any activity that might be described as premium financing.

Homeownership education is required only for a home-purchase mortgage where all occupying borrowers are first-time homebuyers. The borrower must complete the homeownership education program before the mortgage’s note date. See Guide Section 5103.6 for other requirements related to homeownership education.

Homeownership education may be provided by HUD-approved counseling agencies, housing finance agencies (HFAs), Community Development Financial Institutions (CDFIs), mortgage insurance companies or other programs that meet National Industry Standards for Homeownership Education and Counseling. Borrowers may also choose to take Freddie Mac’s free homeownership education course, CreditSmart^® Homebuyer U.

Note: Although Guide Section 5103.6(a)(i) provides otherwise, a Native CDFI may provide the required homeownership education, even if the Native CDFI is the originating lender and/or the seller.

Except as detailed below, a seller or servicer must provide early delinquency counseling to borrowers who have problems meeting their mortgage obligations. The counseling may be provided by a nonprofit, third-party homeownership counseling agency, a HUD-approved national counseling agency specified by Freddie Mac or the servicer itself. For details, refer to Guide Section 9101.2: Servicer collection efforts for Mortgages secured by Primary Residences.

If the servicer knows or reason to believe that the tribe, a Native CDFI, and/or a tribally designated housing entity associated with the applicable tribe has established program requirements to offer its own early delinquency counseling and/or has already offered early delinquency counseling to a delinquent borrower on a HeritageOne mortgage, then the Servicer is not required to offer early delinquency counseling. However, the servicer must document the basis for not offering early delinquency counseling in the mortgage file if it is not required to offer such counseling.

A manufactured home is built in a factory in accordance with the Manufactured Home Construction and Safety Standards of June 1976 (“the HUD Code” – 24 C.F.R. Part 3280) and secured on a permanent, non-removable steel frame or chassis. The home can be built as one complete section, or in multiple sections, and then transported, assembled and installed at the home site.

The manufactured home may be a single-wide home, multi-wide home or CHOICEHome^® certified.

Yes, Freddie Mac will purchase a mortgage secured by a manufactured home that has an addition; however, any structural modifications to an existing manufactured home must be verified and approved by a licensed professional engineer or the local, state or federal authority.

Yes, the mortgage must be secured by a perfected first lien on real estate that consists of the manufactured home and the land on which the manufactured home is permanently affixed and the manufactured home must be legally classified as real property under applicable state law, including relevant statutes, regulations and judicial decisions.

Mortgages secured by a manufactured home on a leasehold estate, including tribal trust land or allotted trust land, are eligible for sale to Freddie Mac. (Note: For HeritageOne, the manufactured home securing the leasehold mortgage must be located on either tribal trust land or allotted trust land and cannot be located on land that is owned in fee simple.) A manufactured home on a leasehold estate must be located in a state that permits surrender of a certificate of title, regardless of whether the land on which the manufactured home is located is owned by the owner of the manufactured home.

Sellers must obtain Freddie Mac's written approval before selling mortgages secured by a manufactured home on a leasehold estate.

A mortgage secured by a manufactured home must be submitted to LPA. A mortgage secured by a single-wide manufactured home or a CHOICEHome or a mortgage secured by a manufactured home on a leasehold estate must receive a risk class of Accept.

A mortgage secured by a multi-wide manufactured home that is submitted to LPA and receives a risk class of Caution or an assessment status of invalid, ineligible or incomplete must be manually underwritten in accordance with the requirements of Topics 5100 through 5500 and must have the minimum Indicator Scores required on Exhibit 25. See Guide Section 4504.6 for additional requirements for Manually Underwritten HeritageOne mortgages.

No, the manufactured home must be titled as real property. Freddie Mac currently does not have a “home-only” or chattel offering.