8101.8: Confidential information, privacy, conflicts of interest, misuse of material information, and security of information (03/02/16)

© Freddie Mac Single-Family Seller Servicer Guide

Through its Servicing of Mortgages for Freddie Mac, the Servicer sometimes obtains confidential information concerning the Borrower and the Mortgaged Premises. This information must not be used in any way that could be construed to represent a conflict of interest or breach of confidentiality and may only be used for purposes of Servicing Mortgages for Freddie Mac and only as permitted under applicable law, including without limitation, all applicable federal, State and local laws relating to data privacy, the safeguarding of information, disclosure of credit information or the purchase and sale of securities. The Servicer must maintain all such confidential information in such a way as to ensure the security and confidentiality of the information; protect against anticipated threats or hazards to the security or integrity of the information; and protect against unauthorized access to or use of such information.

(a) Access to confidential information
The Servicer must disclose to the Borrower, or to any third party authorized in writing by the Borrower, information maintained by the Servicer concerning the Borrower's payment history if the Borrower (or any third party authorized by the Borrower) shall request such information in writing. Information so disclosed must be correct, complete and up-to-date and must accurately reflect the Borrower's performance in meeting payment obligations without the use of codes or abbreviations.

(b) Misuse of material information
Certain information about individual Mortgages or Mortgaged Premises obtained by the Servicer through its Servicing of Mortgages for Freddie Mac may be material to a purchaser or a seller of PCs representing interests in those Mortgages. This information is considered to be material if there is a substantial likelihood that a reasonable investor would consider the information to be important in determining whether to purchase or sell a PC representing interests in the Mortgages. The Servicer may not purchase or sell such a PC (or disclose material information relating to the PC to a third party for its use) without disclosing such material information to the other party to the transaction. However, if disclosure of such information to other parties would contravene applicable law and regulations regarding disclosure of credit information, the Servicer must refrain from trading with respect to the PC.