8406.10: Transfer of Ownership fees (03/02/16)

Owned by Kacey Olson
Nov 23, 2018
2 min read

© Freddie Mac Single-Family Seller Servicer Guide

Subject to applicable law or regulation, the Servicer may charge and retain a fee for processing a Transfer of Ownership of, or an interest in, the Mortgaged Premises securing a Mortgage purchased by Freddie Mac. Where applicable law or regulation limits the amount of the allowable fee, the Servicer may not charge more than the lesser of:

  • The maximum fee allowed under applicable law or regulation, or
  • The maximum fee allowed by Freddie Mac as stated below

This fee must be set in accordance with the following provisions:

(a) Security Instruments without a due-on-transfer clause The fee charged by the Servicer for changing its records for a Transfer of Ownership for which its consent was not required must not exceed $100.

(b) Security Instruments with a due-on-transfer clause When the Servicer must determine the creditworthiness of a transferee in connection with a Transfer of Ownership, the Servicer may charge and retain a fee equal to the greater of $400 or 1% of the UPB, with a maximum fee of $900. Transfer fees may be exclusive of out-of-pocket expenses paid to independent third parties for services required to comply with the application and approval process contained in Sections 8406.5 through 8406.8 and to record the change of ownership. Any other services (such as surveys, owner's title policies, etc.), requested by the transferee are the sole responsibility of the transferee. Loan discount fees, yield enhancement fees, lost opportunity fees and similar devices designed to circumvent these limitations or increase the effective interest rate or yield of the Mortgage previously sold to Freddie Mac, regardless of the Servicer's retained interest in the Mortgage, are expressly prohibited. The Servicer may establish a transfer fee schedule that results in charges less than those permitted by Freddie Mac. However, if any fee charged by the Servicer on Mortgages sold to Freddie Mac exceeds the amounts stated above, it will be considered a breach of this Guide and, unless refunded to the Borrower, Freddie Mac may exercise any remedy available under this Guide or applicable law to remediate the violation.