Ready or Not, Here They Come: Changes to Freddie Mac Investor Reporting
In February 2017, Fannie Mae implemented changes to investor reporting requirements in accordance with new regulations set out by the Federal Housing Finance Agency (FHFA). FHFA's goal was to increase efficiency for servicers and streamline the reporting process for investors, as well as prepare for the Single Security Initiative (SSI), which is a joint venture between Fannie Mae and Freddie Mac under the direction of FHFA. This initiative aims to develop a common mortgage-backed security to be issued by Fannie Mae and Freddie Mac.
Now that mortgage servicers have had the opportunity to adequately acclimate to Fannie Mae's reporting changes, it's time to prepare for Freddie Mac's changes. The GSE has been developing its own Investor Reporting Change Initiative (IRCI) with an implementation date of May 2019. While these changes may still be a way off, the initiative has been in the making for quite some time now, with Freddie Mac beginning work on Phase 1 before Fannie Mae's changes went into effect early last year.
Any changes to regulatory standards will have a direct impact on servicers' operations, requiring modifications to their processes and technologies. So, what do servicers need to know and do to comply with the new Freddie Mac IRCI?