Under FHFA guidance, Fannie Mae and Freddie Mac (the “GSEs”) announced retirement dates for Adjustable-Rate Mortgage (ARM) loans with a Constant Maturity Treasury (CMT) index.
The GSEs both announced that they will not purchase any CMT-indexed ARM loans with an application date of July 1, 2021 or later. As of October 1, 2021, no CMT-indexed ARM loans will be eligible for GSE purchase, regardless of the application or note date.
In Lender Letter LL-2021-05, Fannie Mae clarifies that all CMT-indexed ARMs “must be purchased as whole loans on or before September 30, 2021 or delivered into MBS pools with issue dates on or before September 1, 2021.” Fannie Mae will be retiring all CMT ARM loan plans and will be releasing Selling Guide updates prior to the September 2021 deadlines. Freddie Mac Bulletin 2021-4 similarly provides that no CMT-indexed ARM loan with a settlement date of October 1, 2021 or later will be accepted for delivery.
These changes do not affect servicers currently servicing loans using the CMT index, which continues to be published.
DocMagic will continue to provide updates as more information is provided, including a list of any forms that are retired. If you have any questions, please contact DocMagic’s Compliance Department.
