Rules to affect delivery requirements, LoanProspector
By MortgageDaily.com staff
8/11/2003

Adjustable-rate mortgage data, race/ethnicity data and details about LoanProspector.com are among the items revised by Freddie Mac in its latest seller/servicer bulletin.

The Home Mortgage Disclosure Act (HMDA) and the USA Patriot Act both call for revisions in the information gathered at the time of a loan. Freddie says that it will be changing delivery requirements because of these mandated changes in Form 65, the Uniform Residential Loan Application.

Freddie said it would require applications that had loans delivered after January 1, 2004, to use the revised information regarding race and ethnicity. If the loan was applied for before January 1, 2004 but delivered after that date, the information must be sent in a revised form that complies with the Federal Reserve Board's rule, Freddie said.

Adjustable-rate mortgage data will soon require the reporting of four new elements: Index Source Code, Index Lookback Days, First Rate Adjustment Min. Rate and First Rate Adjustment Max. Rate, Freddie said. This latest bulletin allows those changes to be delayed and new reporting will not be necessary until January 1, 2004, it said.

Borrowers will soon be allowed more choice when purchasing a new home, according to the bulletin. Starting October 7, 2003, the construction lender and the permanent mortgage lender do not have to be the same for a property, Freddie said.

LoanProspector.com will begin to use some new terms, mainly so that the service will not become confused with other services Freddie plans to offer, the bulletin said.

Originators for loans in Puerto Rico will begin using a revised form November 1, 2003, for fixed rates and first mortgages, the bulletin said.

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