4101.2: Home Mortgage Uniform Instruments (11/15/17)

(a) Use of Uniform Instruments

The Security Instrument and Note must be executed on the Uniform Instruments (1-4 Family) for the jurisdiction where the Mortgaged Premises are located. The Uniform Instruments used for a Mortgage must be the versions current as of the Mortgage Note Date. See Exhibit 4, Single-Family Uniform Instruments, for the current dates of revisions of all Uniform Instruments.For any Mortgage secured by one of the following types of property, Freddie Mac requires both:

• The single-family Fannie Mae/Freddie Mac Uniform Security Instrument for the jurisdiction where the Mortgaged Premises are located, and

• One of the following types of riders, as applicable:

  Property Type	Form
  Condominium Unit	Condominium Rider Form 3140
  Planned Unit Development unit	Planned Unit Development Rider Form 3150
  1- to 4-unit Investment Property	1- to 4-Family Rider Form 3170
  2- to 4-unit Primary Residence	1- to 4-Family Rider Form 3170
  Second home	Second Home Rider Form 3890

(b) Additional Mortgage documentation requirements

In addition to the Uniform Instruments required by this Section 4101.2, certain Mortgage products have additional loan documentation requirements stated elsewhere in the Guide as follows:

• Section 4301.7 for Texas Equity Section 50(a)(6) Mortgages
• Section 4402.3 for Seller-Owned Converted Mortgages
• Section 4604.4 (a) for Affordable Merit Rate® Mortgages
• Sections 5703.7(d) and 5703.7(e) for Mortgages secured by Manufactured Homes
• Section 4602.3 for Construction Conversion and Renovation Mortgages
• Chapter 4205 for Government Funded, Guaranteed or Insured Mortgages

(c) Mortgage instruments for ARMs

(i) Required ARM Uniform Instruments

ARMs must be closed on the Uniform Instruments for the applicable ARM product described in the charts below.

The Uniform Instruments for an ARM consist of an ARM Note, the Fannie Mae/Freddie Mac Security Instrument and any applicable property type riders, and an ARM rider to the Security Instrument. The Seller must use the most current version of the State-specific Fannie Mae/Freddie Mac Single Family Security Instrument prepared for use in the jurisdiction in which the Mortgaged Premises are located and the most current version of any applicable property type riders. The Seller must also use the most current version of the ARM Note and ARM rider.

The most current version of the Uniform Instruments is the version in effect as of the Note Date of the Mortgage. See Exhibit 4, Single-Family Uniform Instruments, for the current dates of revisions of all Uniform Instruments. See Exhibit 5, Authorized Changes to Notes, Riders, Security Instruments, and the Uniform Residential Loan Application, for authorized changes to the Uniform Instruments.

The ARM Note and ARM rider must be completed in accordance with the terms of the applicable ARM product. See Section 4101.2(c)(iii) for instructions for completion of Section 4(D) of an ARM Note.

For certain ARM products, State-specific versions of the ARM Note have been prepared for Alaska, Florida, New Hampshire, Puerto Rico, Vermont, Virginia, West Virginia and Wisconsin. If a State-specific version of an ARM Note has been prepared, it must be used for ARMs secured by Mortgaged Premises located in that State. The multistate version of the ARM Note, with the required changes stated in Exhibit 5, must be used in all other States.

Freddie Mac makes available Uniform Instruments for use with ARM products with various features.The Uniform Instruments have the following features embedded in the form itself (hard-coded):

• Index
• Lookback Period
• Assumability

The Uniform Instruments have blanks to be completed by the Seller for the following features (soft-coded):

• Maturity Date (determines the term)
• First Interest Change Date (determined by the Initial Period)
• Maximum interest rate at the first Interest Change Date (determined by the Initial Cap)
• Maximum increase or decrease in the interest rate at each adjustment after the first Interest Change Date (Periodic Cap); the Periodic Cap is hard-coded 1% or 2% for 1-Year Weekly Constant Maturity Treasury (CMT)-Indexed Assumable Life of Loan with 45 day Lookback Period
• Maximum interest rate for the life of the loan (Lifetime Ceiling; determined by the Life Cap)

In determining which Uniform Instrument to use with each ARM product, the Seller must select the form with the applicable hard-coded information and complete the soft-coded information as appropriate. Because many of the features of an ARM product are soft-coded, the same Uniform Instrument may be used for different ARM products. For example, the 1-Year LIBOR-Indexed ARM Note and rider may be used with a 1/1, 3/1, 5/1, 7/1 and 10/1 LIBOR-Indexed ARM with the same Lookback Period and assumability period.

The Uniform Instruments may be used for ARM products that do not meet the eligibility requirements for sale to Freddie Mac. Freddie Mac encourages the Seller to use Uniform Instruments, if available, for originating ARM loans even if the ARM product is not eligible for sale.

The following charts describe the Uniform Instruments available for different hard-coded features for ARM products:

* Hard-coded with a 1% Periodic Cap
** Hard-coded with a 2% Periodic Cap
+ Periodic Cap not hard-coded, must be completed by the Seller

All ARM Uniform Instruments are available on Freddie Mac's web site at http://www.freddiemac.com/singlefamily/guide/?tab=2&tog.

(ii) Use of Fannie Mae ARM instruments

The Seller may use Fannie Mae's ARM instruments only in accordance with the provisions of this subparagraph. The Seller must consult its own legal counsel when using a Fannie Mae instrument for a particular Freddie Mac ARM product.The Seller originating ARMs on Fannie Mae instruments represents and warrants that the Fannie Mae instrument, when completed, is appropriate for the applicable Freddie Mac ARM product and can be serviced in accordance with the Guide.(iii) Instructions for completing Section 4(D) of an ARM Note

The Seller must complete Section 4(D), Limits on Interest Rate Changes, of an ARM Note as follows:

1. Insert in the first blank of the first sentence, referring to the maximum interest rate on the first Interest Change Date, the interest rate that is equal to the sum of the initial Note Rate for the Mortgage, plus the applicable Initial Cap for that ARM program

2. Insert in the second blank of the first sentence, referring to the minimum interest rate on the first Interest Change Date, the interest rate that is equal to the initial Note Rate for the Mortgage, minus the applicable Initial Cap. If this difference is less than the specified Margin, insert the specified Margin in the second blank of the first sentence.

3. If the second sentence has blanks for the Periodic Cap, insert the applicable Periodic Cap for that ARM product in words followed by numerals in parentheses (for example, "two percentage points (2.0%)")

4. Insert in the blank in the last sentence, referring to the maximum interest rate during the life of the Mortgage (Lifetime Ceiling), the Note Rate in effect at time of origination plus the applicable Life Cap for that ARM product

Additional Resource: http://www.freddiemac.com/singlefamily/guide/