Fannie Mae and Freddie Mac announced this week a revised selling representation and warranty framework at the direction of their regulator, the Federal Housing Finance Agency.
The new uniform rules are intended to clarify what characterizes origination defects and what actions loan servicers can take to respond to them, according to
"We know that uncertainty about representations and warranties can have a negative impact on the cost of credit and on access to credit," an FHFA spokesperson said in a statement. "The enhanced framework is intended to provide more clarity and transparency to lenders."
The new policy will be implemented starting Jan. 1, 2016.
