Freddie Mac has announced the availability of standardized subordinate-mortgage documents for additional states. The new state-specific forms are available on the Freddie Mac subordinate-lien document webpage. The webpage also provides additional information regarding the use of the standardized subordinate-lien documents, including FAQs and links to additional lender information.
The model forms have been reviewed and agreed to by Fannie Mae and Freddie Mac for use by any Down Payment Assistance (“DPA”) provider, such as state and local housing finance agencies (“HFAs”). The forms can be used in the place of agency-specific forms with non-standard language. Although Fannie Mae and Freddie Mac do not currently purchase subordinate liens, the forms are being provided by Freddie Mac with the intent of bringing “market efficiencies and cost savings to HFAs, their participating lenders and DPA providers nationwide.”
The model forms include subordinate amortizing notes, subordinate forgivable fixed-rate notes and subordinate deferred-payment notes. Model subordinate security instruments, subordinate MERS security instruments, and subordinate eNotes are also available for use.
Similar to Uniform Instruments, the model subordinate documents have a Freddie Mac/Fannie Mae tagline which must be removed if any changes are made to the forms, except those authorized by Freddie Mac/Fannie Mae, or those made pursuant to applicable state law or recording requirements. Form instructions are included on the model form in red text.
DocMagic currently has Freddie Mac standardized subordinate mortgage documents available for use for the following states in connection with their DPA loans: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Florida, Idaho, Illinois, Iowa, Massachusetts, Minnesota, Nebraska, New Jersey, New Mexico, Ohio, Pennsylvania, South Dakota, Tennessee, Utah, Virginia, and Washington.
Beginning on November 7, 2024, DocMagic will make additional standardized forms available based on the newly released state-specific model forms. This will include Indiana, Kentucky, Louisiana, Michigan, Oregon, Texas, and District of Columbia. Freddie Mac plans to ultimately release subordinate-lien model forms for all 50 states plus the U.S. territories of Puerto Rico, Guam, and the Virgin Islands.
If you have any questions, please contact DocMagic’s Compliance Department.
