Freddie Mac Desk Reference Expense Reimbursement Desk Reference

Expense Reimbursement

Desk Reference

March 2016

Notice

The information in this publication is intended to provide general guidance to Freddie

Mac Servicers.

This information is offered as an aid in - not a substitute for - complying with the requirements set forth in the Single-Family Seller/Servicer Guide (the Guide), as amended. Each Freddie Mac approved Servicer must comply with all the provisions of the Guide, and of all other Purchase Documents, as that term is defined in the Guide.

This publication does not constitute a part of the Guide or a Purchase Document.

The requirements and guidelines referenced in this publication are subject to change at any time by Freddie Mac.

Publication Number: 239

Last Updated: March 2016

©

2016 Federal Home Loan Mortgage Corporation.

All rights reserved.

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Table of Contents

About Your Expense Reimbursement Desk Reference ......................................... iii

CHAPTER 1: THE REIMBURSEMENT SYSTEM

Using the Reimbursement System ................................................................. 1-1

How to Obtain Your User ID and Password for the Reimbursement System 1-1

How to Access the Reimbursement System .................................................. 1-3

CHAPTER 2: PREPARING AND SUBMITTING YOUR CLAIMS

Guidelines for Preparing and Submitting Your Claims ................................. 2-1

Submission Types and Timeframes ............................................................... 2-2

Supporting Documentation ............................................................................ 2-5

Expense Reimbursement and the MI Claim Filing Process .......................... 2-5

CHAPTER 3: DOCUMENTING EXPENSES AND INCOME/CREDIT

Documenting the Billing Period and Vendor ................................................ 3-1

Documenting Insurance Expenses ................................................................. 3-2

Documenting Tax Expenses .......................................................................... 3-3

Documenting Yard Maintenance Expenses ................................................... 3-4

Documenting Income/Credit to Offset Expenses .......................................... 3-4

Documenting Similar Expense and Income/Credit Items .............................. 3-4

Documenting HOA, PUD, and Condominium Assessments ......................... 3-5

CHAPTER 4: EXPENSE AND INCOME CODES

Expense Codes Listed by Activity Type ........................................................ 4-1

Income Codes Listed by Activity Type ....................................................... 4-21

City of Chicago, Illinois Vacant Property Ordinance Expense Codes ........ 4-23

CHAPTER 5: 1-4 UNIT PROPERTY APPROVED EXPENSE AMOUNTS

Key Terms ...................................................................................................... 5-1

Expense Amounts .......................................................................................... 5-2

Attorney Fees and Title Work Expense Limits ........................................... 5-10

CHAPTER 6: REQUESTS FOR PRIOR APPROVAL (RPAs)

What is a Request for Prior Approval (RPA)? .............................................. 6-1

Preparing and Submitting the RPA ................................................................ 6-1

RPAS for Property Preservation .................................................................... 6-2

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RPAs for Extension of Days .......................................................................... 6-2

RPAs for Legal Fees ...................................................................................... 6-3

RPAs for Transfer Taxes ............................................................................... 6-4

CHAPTER 7: EXPENSE REIMBURSEMENT AUDITS

Expense Reimbursement Audit Overview ..................................................... 7-1

CHAPTER 8: NON-REIMBURSABLE EXPENSES

List of Non-reimbursable Expenses ............................................................... 8-1

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Freddie Mac Document

About Your Expense

Reimbursement Desk Reference

We created this desk reference to give you quick and easy access to information that will help you complete your expense reimbursement claims. Each section contains requirements and guidelines to help you prepare and submit an accurate and complete claim to us via the

Reimbursement System.

Refer to Single-Family Seller/Servicer Guide (Guide) Chapter 9701 for detailed requirements on expense reimbursement.

If you have any questions about completing your expense reimbursement claims after reviewing this desk reference, please contact (800) FREDDIE.

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The Reimbursement System

1

Using the Reimbursement System

You are required to submit all of your expense reimbursement claims via the Reimbursement

System available on FreddieMac.com.

How to Obtain Your User ID and Password for the Reimbursement System

If you do not already have access to the Reimbursement System, a vice president or more senior officer from your organization must complete Form 1200, Reimbursement System User Setup

Form, to designate an individual in your organization to serve as system administrator. The system administrator will obtain an initial user ID, vendor code and password from us for your organization, and will be responsible for administering user IDs, the vendor code, and passwords in accordance with the Freddie Mac Reimbursement System User’s Guide. For additional information, refer to Single-Family Seller/Servicer Guide (Guide) Chapter 9701.

To access Form 1200, perform the following steps:

1. Access the Servicing page at the following URL on FreddieMac.com: http://www.freddiemac.com/singlefamily/service/index.html

. The Servicing page displays.

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Reimbursement System

2. Scroll down and click on the Reimbursement System User Setup Form.

The Reimbursement System User Setup Form displays.

3. Complete and return the form to [email protected] or fax it to 571-382-4919.

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Reimbursement System

How to Access the Reimbursement System

Perform the following steps to access the Reimbursement System:

1. Access the Servicing page at the following URL on FreddieMac.com: http://www.freddiemac.com/singlefamily/service/index.html

..

2. Click Log In under Reimbursement System.

3. Enter your user name and password.

4. Click Log In to access the application.

After you access the Reimbursement System, you are ready to being entering your data. For specific instructions on how to enter data for your claims, refer to the Freddie Mac

Reimbursement System User’s Guide.

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Preparing and Submitting Your

Claims

2

You must submit all of your expense reimbursement claims via the Reimbursement System.

You are not required to submit supporting documentation for expense reimbursement claims, unless we request documentation for specific expenses. If we request supporting documentation, you must submit the documentation to us within the timeframe outlined in our request.

Do not submit a claim to request compensation for workouts. We will track all workouts that you settle on a monthly basis. Each month, we will send you a check and the loan detail for all eligible workouts and repayment plans you settle during the period for which you are being compensated.

You may choose to receive reimbursement of expenses and payment of incentives via

Automated Clearing House (ACH) credit entries into your commercial checking accounts, rather than receiving paper checks. For instructions on how to receive ACH credit entries, refer to

Exhibit 98, Expense Reimbursement/Incentive Payment Authorization Agreement for ACH

Credits.

Guidelines for Preparing and Submitting Your Claims

 Verify that you do not exceed Freddie Mac’s approved expense limits, unless you have submitted a request for pre-approval (RPA) via the Reimbursement System and we have provided approval. For a complete listing of Freddie Mac’s approved expense amounts, refer to Single-Family Seller/Servicer Guide (Guide) Exhibit 57, 1-4 Unit Property Approved

Expense Amounts, and Guide Exhibit 57A, Approved Attorney Fees and Title Expenses, or

Chapter 5, 1-4 Unit Property Approved Expense Amounts, in this desk reference.

 Send a check made payable to the Federal Home Loan Mortgage Corporation for any amount due Freddie Mac if the net income/credit exceeds net expenses. If you have no expenses to offset the income, you will be unable to complete an expense reimbursement claim – you will only send a remittance. Ensure that you include the Freddie Mac loan number on your remittance.

Send your remittance to the following address:

Non-REO-Related Remittances REO-Related Remittances

JP Morgan Chase Bank

131 S. Dearborn – 6 th

Floor

Chicago, IL 60603

Attn: Freddie Mac / 93434

Freddie Mac

P.O. Box 730453

Dallas, TX 75373-0453

Attn: Cash Remittances

Remittances forwarded by wire transfer must

Wire Transfer for REO-Related Remittances

Bank Name: JPMorgan Chase Bank, NA reference the Freddie Mac loan number, address of property, and the type of proceeds

Location: McLean, Virginia

(e.g., REO repurchases, mortgage insurance

Routing Number: 021000021 claim proceeds, and property insurance claim

Account Number: 9102418887 proceeds).

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Preparing and Submitting Your Claims

Submission Types and Timeframes

Expense reimbursement may occur after:

 The completion of a mortgage modification, if the reimbursable expenses were not capitalized in the modification or otherwise paid by the borrower.

 The completion of either a non-Real Estate Owned (REO) event or activity (such as a workout option or purchase of the property by a third party for less than total debt). Such action is referred to as a “non-REO” claim submission type.

 Freddie Mac’s acquisition of the REO (through foreclosure sale or deed-in-lieu of foreclosure). Such action is referred to as an “REO” claim submission type.

 Completion of the REO sale by Freddie Mac, also referred to as an “REO” claim submission type.

 Freddie Mac receives the claim payment on a mortgage insured by the FHA or guaranteed by the VA or Rural Housing Service (RHS) not subject to recourse or indemnification.

Mortgage modification expenses, non-REO and REO claim submissions have different submission types and time frames. Guide Section 9701.5 provides a summary of the requirements for each claim submission type, which are also outlined on the following pages.

However, the claim submission time frames provided for in Guide Section 9701.5 are not applicable for mortgages insured by the FHA, or guaranteed by the VA or RHS.

For claim submissions on mortgages insured by the FHA, or guaranteed by the VA or RHS, you may submit a claim for expense reimbursement in the Reimbursement System after Freddie Mac has received the claim payment from the applicable entity (see Guide Section 9603.2 on

FHA/VA/RHS claim filing and Guide Section 9603.5 on receipt of claim payment). However,

Freddie Mac must receive the expense reimbursement claim no later than 60 days after Freddie

Mac has received the claim payment.

Mortgage Modification Expenses

You must submit all mortgage modification related expenses in the initial claim. The exception to this would be for recordation fees, which may be submitted on a supplemental claim. Mortgage modification expenses are limited to mortgage modifications that have a settlement date in Freddie Mac's systems.

Description

Filed to request reimbursement of expenses related to a mortgage modification. Expenses are reimbursable per the guidance provided in Guide

Section 9206.15.

Claim Type

Initial

Timeframe

We must receive the claim no later than 90 days from the mortgage modification settlement date provided in Freddie Mac systems.

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Description Claim Type Timeframe

Filed to request reimbursement of recordation fees related to a mortgage modification.

Expenses are reimbursable per the guidance provided in

Guide Section 9206.15.

Supplemental

We must receive the claim no later than 180 days from the mortgage modification settlement date provided in Freddie Mac systems.

Non-REO Expenses

Non-REO expenses may include, but are not limited to, costs associated with the following:

 Workout settlements (i.e., short sales and charge-offs), not including mortgage modifications.

 Purchase of a property by a third party at foreclosure sale (after Freddie Mac's approval of any deficiency charge-off amount)

 Legal fees and/or legal costs considered non-recoverable from the borrower under applicable federal, state or local law upon reinstatement or pay off of the mortgage

 Bankruptcy completion on a current mortgage for which we pre-approved your hiring of an attorney to protect our interests when the borrower filed a bankruptcy and is current on the mortgage

 Title reports related to rejected workouts

Use the following table to determine when you must submit your claims for non-REO expenses.

Description

Filed to request reimbursement of expenses you incurred for a short sale or charge-off

Claim Type

Final

Timeframe

We must receive the claim within 45 calendar days after the completion of the non-REO workout activity or event.

Filed to request reimbursement of an expense omitted from the final claim; usually a delayed invoice you received for a short sale or charge-off

Supplemental

We must receive the claim no later than 60 calendar days from the completion of the non-REO activity or event.

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REO Expenses

We consider a property to be REO when we acquire it at foreclosure sale or at the end of a redemption or confirmation period, or by accepting a deed-in-lieu of foreclosure.

Use the following table to determine when you must submit your reimbursement claims for pre- and post-foreclosure sale expenses for REOs.

Description

Filed to request reimbursement of expenses incurred up to and including the foreclosure sale date.

Reimbursable expenses include, but are not limited to, incurred legal fees and costs.

Claim Type

Initial

Timeframe

We must receive the claim within 45 days after the foreclosure sale date.

(Refer to Guide Sections 9301.2 and 9209.8 regarding reporting requirements for foreclosure sale results and deed-in-lieu of foreclosure transactions.)

Filed to request expenses incurred after the foreclosure sale date but prior to the settlement of the sale of the

REO

Supplemental

You may submit any time after the foreclosure sale date, but no later than 60 days after the settlement of the sale of the

REO.

Filed to request reimbursement of allowable expenses incurred after the foreclosure sale date

Final

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Preparing and Submitting Your Claims

Supporting Documentation

Typically, we will not require you to send supporting documentation with your expense reimbursement claims. However in some instances, such as expense reimbursement claim audits, we will require that you provide standard supporting documentation so that we can complete our review.

Standard supporting documentation includes, but is not limited to the following:

 Copies of the original bills or invoices for expenses submitted on the claim, including, but not limited to, legal fees and costs, property inspections, property preservation costs, primary mortgage insurance premiums and condominium/HOA/PUD assessments.

 A copy of the loan history reflecting twelve months prior to the DDLPI up until the date we request the loan history. Proof of payment of normal escrow items is not necessary, if provided in the loan history. However, if tax payments are not consistent with the other taxes, or paid in a lump sum, you must provide documentation from the taxing authority providing the breakdown of the tax amount, including any late charges, penalties, or interest, if applicable.

 A copy of the project declaration highlighting, if applicable, the portion of the condominium, HOA or PUD assessments that may take priority over the mortgage

 The buydown account balance, if applicable.

 Copies of the claim filed with the RHS, if applicable.

Expense Reimbursement and the MI Claim Filing Process

Freddie Mac files MI claims on its own behalf. We rely upon the timeliness and quality of the data you provide to file accurate and complete MI claims. Specifically, we use the expense reimbursement data you submit to determine the expenses we claim.

To facilitate the processing of Freddie Mac MI claims, you must take the following actions when preparing and submitting your claims.

 Submit your claims via the Reimbursement System within the timeframes outlined in

Guide Section 9701.5, and stated on pages 2 through 4 in this chapter. Late filing may result in a reduction in claim proceeds and Freddie Mac, in turn, may reduce your claim in the event your submissions are late.

 Ensure that your claim is accurate and complete. Missing or inaccurate information delay your reimbursement.

 Provide the correct expense codes. Refer to Chapter 4, Expense and Income Codes, in this desk reference and Guide Exhibit 74, Expense and Income Codes for Expense

Reimbursement Claims, for a complete listing of expense and income codes. If expenses are not coded correctly, the mortgage insurance companies may ask you for more information or documentation.

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Preparing and Submitting Your Claims

 Document the “from” date and “to” date for foreclosure fees and costs correctly. Refer to

“Documenting Expenses and Income Credit’ in this desk reference for additional information.

 Provide any requested supporting documentation to the MI company or Freddie Mac, as applicable.

If You Receive a Mortgage Insurance Premium Refund

The MI companies should send mortgage insurance premium refunds directly to Freddie Mac.

However, if you receive a mortgage insurance premium refund, document the mortgage insurance premium refund using income code 815050, Mortgage Insurance Premium Refund.

If you receive the refund after you have submitted the final claim to Freddie Mac, you must send a check, referencing the Freddie Mac loan number, to us at the following address:

JP Morgan Chase Bank

131 S. Dearborn – 6 th

Floor

Chicago, IL 60603

Attn: Freddie Mac / 93434

Notice of Default Fee

The Notice of Default (NOD) fee on the Servicer Non-Performing Loans Invoice includes MI curtailments that are billable to the Servicer. Examples include, but are not limited to, expenses incurred due to untimely delays in notice of default, foreclosure completion, and acquiring the title.

To appeal the NOD fee, contact the MI company directly and provide documentation regarding the MI curtailment. Most MI companies allow 60 days to appeal the curtailment. If the MI company approves the appeal, contact Freddie Mac. When Freddie Mac receives the funds from the MI company, Freddie Mac will remove the fee from the Servicer Non-Performing Loans

Invoice for primary workout and pool claims.

REO primary MI curtailments are not billed on the Servicer Non-Performing Loans Invoice.

Therefore, adjustments to these curtailments will be reflected through a separate billing process.

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Documenting Expenses and

Income/Credit

3

Documenting the Billing Period and Vendor

Ensure that you provide an accurate “from date” and “to date” to identify the billing period for all expenses. The billing period is the block of time during which the vendor rendered the service, not the date you paid the expense.

 When providing the billing period for foreclosure fees and costs, the “from date” must reflect the date foreclosure was initiated. The “to date” must reflect the acquisition date for REO claims. The acquisition date is defined as either the foreclosure sale or redemption date or the date of the expiration of the redemption or confirmation, whichever occurs later, or the date the deed-in-lieu of foreclosure is accepted. For non-REO claims, the “to date” can be any date up to the date of claim submission.

 For bankruptcy fees and costs, the “from date” must reflect the date the bankruptcy was filed. The “to date” must reflect the date the stay was lifted or the date the bankruptcy was confirmed.

 Billing periods for mortgage insurance premiums and property insurance premiums must correspond to the billing periods indicated on the policy. Freddie

Mac will not reimburse insurance premiums if the billing periods you list overlap with previously paid insurance periods.

 Billing periods for taxes must reflect the tax cycle indicated by the tax authority on the tax bills. Freddie Mac will not reimburse tax expenses if the billing periods you list overlap with previously submitted billing periods.

When documenting the vendor, provide the vendor name, not the description of the expense (for example, XYZ Insurance Company, not insurance).

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Documenting Expenses and Income/Credit

Documenting Insurance Expenses

The following table outlines when insurance premiums are reimbursable:

Type of insurance premium

Prior to the

DDLPI

When reimbursable

After the DDLPI

Property insurance premiums paid through an escrow account

Property insurance premiums incurred and paid up to 12 months prior to the

DDLPI are reimbursable.

For a period up to 14 days after the final non-REO activity or up to 14 days after you receive the Property Condition

Certificate (PCC) from a broker indicating the property has been inspected and is vacant.

Note: You must take all actions required in the mortgage clause of all applicable property insurance policies including, but not limited to, providing all notices to the insurer required under such clause, in order to preserve the coverage and its maximum benefits for you and/or

Freddie Mac, as mortgagee. You must cancel such policies within 14 days after the property has been inspected and is vacant, even if there is claimable damage to the property. You will be notified that the property has been inspected and is vacant via the PCC. In the event you do not receive the PCC within five business days after

REO acquisition, you must check the status via REO

Manager or you can call 800-FREDDIE. If the REO is located in a state in which the borrower may be permitted to redeem the property, you must wait to cancel the insurance until the redemption period has expired and you have received a PCC from the broker indicating the occupancy status.

After the policy is cancelled, you must submit a request to the insurance company for reimbursement for the unearned portion of the insurance premium that you paid on behalf of the borrower. Include a copy of the Deed of

Trust with your cancellation request.

Refer to Guide Section 9603.11 for additional information.

Mortgage insurance premiums

Not reimbursable prior to DDLPI.

If incurred after the DDLPI and before the REO acquisition date.

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Documenting Expenses and Income/Credit

Documenting Tax Expenses

For non-REO claim submissions, taxes are reimbursable if incurred and paid to a taxing authority up to 12 months prior to the DDLPI through the payoff date. For REO claim submissions, Freddie Mac will reimburse for real estate taxes incurred and paid beginning no more than 12 months prior to the DDLPI, and through the REO sale date. If 12 months prior to the DDLPI falls within a tax period, the entire tax period is reimbursable. You must contact us and obtain our written approval before making payments to taxing authorities when federal, state or local income tax liens would take priority over our first lien position.

Example

You are requesting reimbursement for real estate taxes you paid in 11/xx for a property located in California. The DDLPI is 10/01/xy. Twelve months prior to the DDLPI is

10/01/xx. Even though you paid the tax bill in 11/xx, Freddie Mac will reimburse you for the entire billing period because 12 months prior to the DDLPI (10/01/xx) falls within the

7/01/xx - 12/31/xx billing period.

7/01/xx

10/01/xx 11/01/xx 12/31/xx 10/01/xy

DDLPI

Tax bill paid

12 months prior to DDLPI

Tax period

Freddie Mac will reimburse you for the first tax penalty incurred on a non-escrowed mortgage that goes to foreclosure on the condition that you have complied with the requirements of Guide

Section 8201.1. Freddie Mac will not reimburse you for the interest or other charges accrued on delinquent taxes.

Freddie Mac will not reimburse you for any late fees, interest and penalties other than the first tax penalty on a non-escrowed mortgage. However, if a tax authority considers interest as a penalty, or includes interest as part of the penalty, Freddie Mac will reimburse you for the first assessment of the interest penalty only. The "first tax penalty" is the first penalty assessed for any tax, not the first penalty assessed on each type of tax. If you submit a request for reimbursement of real estate taxes and Freddie Mac paid the same taxes as part of the settlement costs when Freddie Mac sold the REO or when you completed a short sale or third-party foreclosure sale where the sale proceeds are less than the total indebtedness, Freddie Mac will not reimburse you for such taxes and will adjust your claim. You are responsible for obtaining a refund from the taxing authority for such taxes.

When requesting reimbursement for taxes paid on a property with multiple parcels, combine amounts for the same expense code and same tax cycle and report as one item. Indicate the number of parcels in the Comments section.

For additional information, refer to Guide Section 9701.6.

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Documenting Expenses and Income/Credit

Documenting Yard Maintenance Expenses

Follow the guidelines below to ensure that you are documenting your reimbursement request for yard maintenance expenses accurately.

 Document the number of weeks covered in the time period in the Quantity field in the

Reimbursement System. Do not indicate the number of times the yard was cut in the

Quantity field.

 Document the date on which the yard maintenance was performed by entering the same date in both the “from date” and “to date” fields.

 Confirm that grass cutting is permitted year-round if requesting reimbursement for this expense between October 1 and March 31. For additional information, Refer to Guide

Exhibit 57, 1-4 Unit Property Approved Expense Amounts.

Documenting Income/Credit to Offset Expenses

 Do not offset anticipated or received mortgage insurance claim payments, property insurance claim proceeds or sales proceeds against any expenses incurred. Send Freddie

Mac a check made payable to the Federal Home Loan Mortgage Corporation for funds you receive for mortgage insurance claim payments, property insurance claim proceeds, and other non-REO and REO related funds within 10 business days of receipt of those funds.

 You must provide a loan history for all loans, whether escrowed or non-escrowed, to support a zero or positive escrow balance.

 Document the positive escrow balance as of the DDLPI. Escrow disbursements for taxes and insurance must be claimed as expenses.

Documenting Similar Expense and Income/Credit Items

Report similar expense and income/credit items as different line items, even though they have the same expense code and same vendor. Do not add similar expense and income/credit items together and enter the total as one line item.

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Documenting Expenses and Income/Credit

Documenting HOA, PUD, and Condominium Assessments

 When requesting reimbursement for homeowners’ association (HOA) or Planned Unit

Development (PUD) dues, document the first month’s assessment as one line item.

Combine the remaining months’ assessments and document as one line item. If the monthly assessment amount changed during the time period for which you are requesting reimbursement, document the first month the assessment changed as a separate line item and then combine the remaining months’ assessments at the new rate and report as another line item.

 When requesting reimbursement for transfer fees assessed by an HOA on the sale of an

REO (not the foreclosure sale), do not combine the transfer fee expense with the monthly

HOA assessment expense. Use expense code 080003 when requesting reimbursement for transfer fees assessed by an HOA.

 We will reimburse you for post-foreclosure condominium, HOA, and PUD regular assessments (dues) and special assessments incurred from the foreclosure sale date through the REO settlement date. We will not reimburse you for any late fees, interest, collection expenses, or attorney fees for late payment of HOA, PUD or condominium assessments.

 When monthly HOA or PUD assessments are paid to two different vendors, combine expense amounts with the same dates and report as one line item using expense code

080000.

 You must pay post-foreclosure condominium, HOA, and PUD regular assessments (dues) and special assessments from the foreclosure sale date up to the REO settlement date.

If state law creates a lien priority over the mortgage lien for condominium, HOA or PUD assessments, or for leasehold estates, ground rent payments, over the mortgage lien for fees assessed before the foreclosure sale date, then we will reimburse you for your payment of regular condominium, HOA or PUD assessments and/or ground rent payments assessed prior to the foreclosure sale date as follows:

 For mortgages with Note dates prior to February 14, 2014:

In an amount no greater than the lesser of:

− The actual amount in regular assessments you advanced

− The maximum amount in regular assessments that, per the project declaration or bylaws, would take priority over the mortgage

− The maximum amount in regular assessments that, per applicable state statute, would take priority over the mortgage

We will not reimburse you for late fees, interest, collections expenses or attorney fees, regardless of whether such amounts may be included under the lien pursuant to applicable state law.

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Documenting Expenses and Income/Credit

 For mortgages with Note dates on or after February 14, 2014:

In an amount equal to the lesser of the actual amount advanced or:

− For mortgages secured by property in the state of Florida — no more than 12 months (or any lesser amount provided by state statute)

−

For mortgages secured by property in the state of Connecticut — no more than nine months (or any lesser amount provided by state statute)

− For mortgages secured by property in all other states (including states that provide an exception for Freddie Mac mortgages) – no more than six months (or any lesser amount provided by state statute)

We will not reimburse you for late fees, interest, collections expenses or attorney fees, regardless of whether such amounts may be included under the lien pursuant to applicable state law.

The following states and jurisdictions give lien priority to condominium HOA, and/or PUD assessments over a mortgage:

−

−

−

−

−

−

−

−

Alabama

Alaska

Colorado

Connecticut

Delaware

−

−

−

−

−

Illinois

Maryland

Massachusetts

Minnesota

Missouri

District of Columbia − Nevada

Florida

−

New Hampshire

Hawaii − New Jersey

−

−

−

−

−

−

−

−

Oregon

Pennsylvania

Puerto Rico

Rhode Island

Tennessee

Washington

West Virginia

Wyoming

Note: The list above may not reflect the current state of the law as laws affecting condominium,

HOA and/or PUD lien priority change frequently. It is your organization’s responsibility to know which states and jurisdictions give lien priority to condominium HOA, and/or PUD assessments over a mortgage.

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Expense and Income Codes

4

Expense Codes Listed by Activity Type

The following table identifies Freddie Mac’s expense codes by activity type.

Bankruptcy

Expense

Code+

011014

Description Additional Requirements and Information

011015

011016

011017

011018

011019

011020

011021

011022

Chapter 7 – Proof of

Claim Preparation

Chapter 7 – Motion for

Relief from Stay (Up to two hearings and order)

Chapter 7 – Additional

Hearings

Chapter 7 – Multiple

Filing Litigation

Chapter 11 – Proof of

Claim, Plan Review and

Plan Negotiations

Chapter 11 – Motion for

Relief from Stay (Up to two hearings and order)

Chapter 11 – Objection to

Plan (Up to two hearings)

Chapter 11 – Agreed

Order; Court Certification of Default/Stay

Terminated

Chapter 11 – Agreed

Order; Notice of

Default/Stay Termination

If anticipated bankruptcy expenses will exceed the expense limits listed in Single-Family

Seller/Servicer Guide (Guide) Exhibit 57A,

Approved Attorney Fees and Title Expenses, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

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Expense and Income Codes

Bankruptcy, continued

Description Expense

Code+

011023

011024

011025

011026

011027

011028

011029

011030

011031

011032

011033

Additional Requirements and Information

Chapter 11 – Payment

Change Notifications

Chapter 11 – Notice of

Fees, Expenses and

Charges

Chapter 11 – Response to

Final Cure Payment for

Agreed Response

Chapter 11 – Response to

Final Cure Payment for

Dispute

Chapter 11 – Additional

Hearings

Chapter 11 – Multiple

Filing Litigation

Chapter 12 – Proof of

Claim, Plan Review and

Plan Negotiations

Chapter 12 – Motion for

Relief from Stay (Up to two hearings and order)

Chapter 12 – Objection to

Plan (Up to two hearings)

Chapter 12 – Agreed

Order; Court Certification of Default/Stay

Terminated

Chapter 12 – Agreed

Order; Notice of

Default/Stay Termination

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

If anticipated bankruptcy expenses will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Expense Reimbursement Desk Reference

March 2016 4-2

Freddie Mac Document

Expense and Income Codes

Bankruptcy, continued

Description Expense

Code+

011034

011035

011036

011037

011038

011039

011040

011041

011042

011043

011044

011045

011046

Additional Requirements and Information

Chapter 12 – Payment

Change Notifications

Chapter 12 – Notice of

Fees, Expenses and

Charges

Chapter 12 – Response to

Final Cure Payment for

Agreed Response

Chapter 12 – Response to

Final Cure Payment for

Dispute

Chapter 12 – Additional

Hearings

Chapter 12 – Multiple

Filing Litigation

Chapter 13 – Proof of

Claim, Plan Review and

Plan Negotiations

Chapter 13 – Motion for

Relief from Stay (Up to two hearings and order)

Chapter 13 – Objection to

Plan (Up to two hearings)

Chapter 13 – Agreed

Order; Court Certification of Default/Stay

Terminated

Chapter 13 – Agreed

Order; Notice of

Default/Stay Termination

Chapter 13 – Payment

Change Notifications

Chapter 13 – Notice of

Fees, Expenses and

Charges

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

If anticipated bankruptcy expenses will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Freddie Mac Document

4-3

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Bankruptcy, continued

Description Expense

Code+

011047

011048

011049

011050

011051

011052

011053

041000

041002

401000

Additional Requirements and Information

Chapter 13 – Response to

Final Cure Payment for

Agreed Response

Chapter 13 – Response to

Final Cure Payment for

Dispute

Chapter 13 – Additional

Hearings

Chapter 13 – Multiple

Filing Litigation

Chapter 11 – Amended

Plan Review

Chapter 12 – Amended

Plan Review

Chapter 13 – Amended

Plan Review

If anticipated bankruptcy expenses will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System to request Freddie Mac’s prior written approval.

If anticipated bankruptcy expenses will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

If the amended plan review is the result of the

Servicer's action or inaction, then Freddie Mac would consider any associated bankruptcy costs and fees as non-reimbursable.

None. Court Costs

Other Court Costs

(PACER, transcript, witness fees)

Appraisal Charge You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Expense Reimbursement Desk Reference

March 2016 4-4

Freddie Mac Document

Expense and Income Codes

Contested Foreclosure

Description Expense

Code+

010013

010014

010015

010016

010017

Additional Requirements and Information

Probate Proceedings

(Judicial)

Contested Foreclosure

Resolved by Trial

(Judicial)

Foreclosure attorney fee for probate proceedings during a contested foreclosure.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Contested Foreclosure

Resolved by Motion for

Summary Judgment

(Judicial)

Responding to a Motion to

Dismiss (Judicial)

Motion for Mediation in a

Contested Foreclosure

(Judicial)

Foreclosure attorney fee for a contested foreclosure in which a defendant files an answer requiring the filing of a summary judgment motion. This includes work leading up to the filing of the summary judgment motion, all court appearances and all written discovery.

You must submit an RPA, along with supporting documentation, via the Reimbursement System to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for responding to a motion to dismiss, including the preparation and filing of a response and attendance at all hearings.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for attendance and appearance at a mediation session for a contested foreclosure that is not part of a State or local law pre-foreclosure mediation program.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for trial, set by court upon its own motion, including, but not limited to, pretrial preparation and correspondence, preparation and filing documents necessary for trial, witness preparation, and all necessary court appearances.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Freddie Mac Document

4-5

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Contested Foreclosure, continued

Description Expense

Code+

010018

010019

010020

010021

Additional Requirements and Information

Contested Foreclosure Fee

– Other (Judicial)

Probate Proceedings

(Non-Judicial)

Contested Foreclosure

Resolved by Motion to

Dismiss (Non-Judicial)

Contested Foreclosure

Resolved by Summary

Judgment Motion (Non-

Judicial)

Foreclosure attorney fee for additional work needed to resolve a contested judicial foreclosure that enters into litigation, whether routine or nonroutine, in order to proceed with the foreclosure.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for probate proceedings during a contested foreclosure.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for a contested foreclosure resolved by the filing of a motion to dismiss and subsequent entry of an order granting motion to dismiss. This includes all work leading up to the filing of the motion to dismiss, and all necessary court appearances.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for a contested foreclosure resolved by the filing of a motion for summary judgment and subsequent entry of an order granting motion for summary judgment.

This includes all work leading up to the filing of the summary judgment motion, including all court appearances and all written discovery.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Expense Reimbursement Desk Reference

March 2016 4-6

Freddie Mac Document

Expense and Income Codes

Contested Foreclosure, continued

Description Expense

Code+

010022

010023

010024

010025

Additional Requirements and Information

Motion for Mediation in a

Contested Foreclosure

(Non-Judicial)

Contested Foreclosure Fee

– Other (Non-Judicial)

Borrower Initiated

Motions

Reply to Affirmative

Defenses/Motion to Strike

Foreclosure attorney fee for attendance and appearance at a mediation session for a contested foreclosure that is not part of a State or local law pre-foreclosure mediation program.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for additional work needed to resolve a contested foreclosure that enters into litigation, whether routine or nonroutine, in order to proceed with the foreclosure.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for responding to a motion initiated by the Borrower or Borrower's counsel, including the preparation and filing of a response and attendance at all hearings.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure attorney fee for responding to affirmative defenses or a motion to strike filed by or on behalf of the Borrower in a contested foreclosure, including the preparation and filing of a response and attendance at all hearings.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Freddie Mac Document

4-7

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Contested Foreclosure, continued

Description Expense

Code+

010026 Discovery (RFP, RFA,

Roggs)

Additional Requirements and Information

Foreclosure attorney fee for responding to a discovery request or propounding discovery in a contested foreclosure, including the preparation and filing of a response and attendance at all hearings.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Foreclosure

Expense

Code+

010000

Description Additional Requirements and Information

010002

010004

010005

010006

010009

010011

Attorney Fees (Judicial) If anticipated attorney fees will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Trustee/Attorney Fees –

Torrens Act

Mediation Court Costs

Mediation – Attorney

Fees

Attorney Fees (Non-

Judicial)

Limited to applicable properties in Minnesota only.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

If anticipated attorney fees will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Bulk Trial

Foreclosure/Inquest

Process

Process Server

Fee/Postage for Mailing of Foreclosure Notices

Limited to Florida, New York, and New York

City only.

None.

Expense Reimbursement Desk Reference

March 2016 4-8

Freddie Mac Document

Expense and Income Codes

Foreclosure, continued

Description Expense

Code+

010027

010028

014005

014006

014007

020000

021000

030000

040000

300000

300005

300008

400001

Additional Requirements and Information

Attorney Fees to Shorten a

Redemption Period

Additional Mediation

Hearings

Foreclosure on a

Cooperative Share

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Final Report/Accounting of the Foreclosure Sale

Status/Conciliation/Case

Management Conference

None.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Advertising Fees - Posting None.

Advertising Fees -

Publication

Sheriff/Auctioneer Fees

Court Costs

Title Work If anticipated title work expenses will exceed the expense limits listed in Guide Exhibit 57A, you must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Limited to applicable properties in Minnesota only.

Torrens Act – Costs (MN only)

Title Preliminary Cost Limited to Ohio and Kentucky only.

Appraisal Charge You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Freddie Mac Document

4-9

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

All Loan Modification Programs

Expense

Code+

Description

042001

300003

300004

400003

Notary Fees

Recordation Fees

Title Costs, if applicable

(Except with respect to title costs in connection with a foreclosure proceeding.)

Home Value Explorer

®

(HVE)

Homeowner’s Association

Additional Requirements and Information

$150

Actual cost.

Reimbursable amounts are in accordance with the limits outlined in Guide Exhibit 57A.

$150

Expense

Code+

080000

Description Additional Requirements and Information

080002

080003

Homeowners’ Association and PUD Fees

Special Assessments

Condominium Project

Documents / HOA

Transfer Fee

Refer to Guide Section 9701.10 regarding such expense liens that could subordinate the mortgage.

None.

Expense Reimbursement Desk Reference

March 2016 4-10

Freddie Mac Document

Expense and Income Codes

Insurance and Taxes

Description Expense

Code+

050000

051000

060000

061000

062000

064000

070000

071001

071002

071003

071004

072000

073000

074001

074002

074003

Additional Requirements and Information

Mortgage Insurance

Premiums

FHA Insurance Premiums

None.

Property Insurance

Premiums

Flood Insurance

Premiums

Lender-placed Insurance

Premiums

Supplemental Windstorm

Coverage

County Property Taxes

Municipal (City) Property

Taxes

Borough Property Taxes

Town Property Taxes

Village Property Taxes

School Taxes

Sewer Charges

Other Property Taxes

Supplemental Tax

Transfer Tax

Provide a brief description of the cost in the

Comments section of the claim.

None.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Ensure that you attach a copy of the pay under protest letter to the RPA. Note: This type of

RPA may be submitted prior to the foreclosure sale or within 45 days after the foreclosure sale.

Refer to Guide Section 9701.15.

Freddie Mac Document

4-11

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Insurance and Taxes, continued

Description Expense

Code+

074004

074005

074006

076000

Additional Requirements and Information

Ground Rents

First Tax Penalty on Nonescrowed Mortgages

Second Tax Penalty

(California only.)

Ad Valorem Tax

None.

Expense Reimbursement Desk Reference

March 2016 4-12

Freddie Mac Document

Expense and Income Codes

Liens

Expense

Code+

Description Additional Requirements and Information

500000

501000

502000

Superior (First) Liens

IRS Liens

Other Liens

500002 Deed-in-Lieu Subordinate

Lien Payment

Maintenance and Preservation

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Refer to Guide Section 8201.1.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Provide a brief description of the cost in the

Comments section of the claim.

None.

Expense

Code+

090028

Description Additional Requirements and Information

090030

090008

090031

090017

090019

090020

090021

090022

Securing (Knob Locks)

Boarding (Broken

Windows)

Police/Fire Report

Pool (In-ground Pool

Securing)

Pre-foreclosure Vacant

Property Registration

Securing (Padlocks)

Securing (Slider Locks)

Securing (Window Locks)

Security Door

If needed for access to, and/or securing of, the property.

Where needed, as required by local ordinances.

All missing windows and doors should be boarded, not repaired.

None.

Covering or boarding of in-ground pools.

Initial vacant property registration and reregistration fees.

If needed for access to, and/or securing of, the property.

Freddie Mac Document

4-13

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Maintenance and Preservation, continued

Description Expense

Code+

090023

090024

090025

090026

090027

091010

091002

091009

090029

093003

Additional Requirements and Information

Boarding (Doors)

Extermination (Non-

Licensed)

Pool (Above Ground Pool

Securing)

Pool Draining

As needed to secure non-access entryways with missing or broken doors.

As needed, to address infestation with over-thecounter products.

Covering or boarding of above ground pools.

Pool may be tarped if pool frame is unable to support weight of covering or boarding.

Collapsed pools may be moved to an exterior shed, garage or other secure structure on the property.

To be used when draining pools, hot tubs, spas or ponds.

Covering or boarding of hot tubs, spas or ponds. Pool (Hot Tubs or Spa

Securing)

Interior Property Cleaning

(Refrigerator)

Trash Removal/Dumping

Fees

Interior Property Cleaning

(Toilets)

As needed, to remove all perishables from refrigerators, freezers and other appliances that may pose a risk of infestation to the property.

Interior must be wiped down and free of hazards.

Interior/exterior debris removal. Do not remove personal property.

None.

Extermination (Licensed) Fumigation by a professional extermination company.

Pest Removal Removal of dead vermin from property.

Expense Reimbursement Desk Reference

March 2016 4-14

Freddie Mac Document

Expense and Income Codes

Maintenance and Preservation, continued

Description Expense

Code+

093004

Additional Requirements and Information

Initial Yard Maintenance

(Lots greater than 10,000 square. feet.)

To be used on properties with lots greater than

10,000 square feet. Full yard and/or perimeter cut, weed removal or desert landscaping, as applicable, once per Yard Maintenance Season*.

093005

094016

094013

094014

094015

090032

095002

Initial Yard Maintenance

(Lots of up to 10,000 square. feet.)

Yard Maintenance (Lots of up to 10,000 square. feet.)

Yard Maintenance (Lots

Greater than 10,000 square. feet.)

To be used on properties with lots of 10,000 square feet or less. Full yard cut, weed removal or desert landscaping, as applicable, once per

Yard Maintenance Season*.

To be used on properties with lots of 10,000 square feet or less. Semi-monthly full yard grass cuts, weed removal or desert landscaping, as applicable, during Yard Maintenance Season*.

To be used on properties with lots greater than

10,000 square feet. Semi-monthly full yard or perimeter grass cuts, weed removal or desert landscaping, as applicable, during Yard

Maintenance Season*.

As needed during Yard Maintenance Season*. Trimming (Shrubs)

Trimming (Trees)

Winterization (Dry)

Dewinterization

One time charge during Winterization Season**.

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Freddie Mac Document

4-15

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Maintenance and Preservation, continued

Description

Expense

Code+

095020

095021

095022

095023

100003

101001

103001

103002

105001

191003

191034

191001

404005

404007

404008

404016

404017

Additional Requirements and Information

Winterization

(Wet/Steam)

One time charge during Winterization Season**.

Winterization (Radiant) One time charge during Winterization Season**.

Re-winterization

Winterization (Additional

Unit)

Capping (Electric)

If necessary, once per calendar year.

One time charge during Winterization Season**.

Capping (Gas)

Capping (Water)

Capping (Sewer)

Capping (Chimney)

Snow Removal

Dryer Vent Cover

To be used if electric is on.

As needed to prevent damage to property.

As needed to prevent damage to property.

As needed to prevent damage to property.

As needed to prevent access to critters and small vermin.

As needed in Winterization Season**.

As needed to prevent access to critters and small vermin.

Other Maintenance Costs You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Provide a brief description of the approved expenses on the claim.

Exterior Property

Inspection

Maximum amount for each monthly inspection completed within the foreclosure state standard time line as listed in Guide Exhibit 83.

Interior Property

Inspection

Deed-in-Lieu Property

Inspection

None.

One time charge.

Ordinance Required

Property Inspection

(Weekly)

Ordinance Required

Property Inspection

(Biweekly)

No more than four in a given month.

No more than two in a given month.

Expense Reimbursement Desk Reference

March 2016 4-16

Freddie Mac Document

Expense and Income Codes

Other

Description Expense

Code+

013005

013006

015000

016000

040002

300006

404001

503000

Additional Requirements and Information

Deed-in-Lieu Borrower

Relocation Assistance

Borrower Relocation

Assistance

Connectivity Fee

Invoicing Fee

Reimbursable up to a maximum of $3,000.

Refer to Guide Section 9209.4 for details on this assistance.

Reimbursable up to a maximum of $3,000.

Refer to Guide Section 9301.21 for details on this assistance.

Reimbursable up to a maximum of $25 per referral for the life of the default. Refer to Guide

Section 9701.11 for details on this fee.

Reimbursable up to a maximum of $5 to process foreclosure invoices and a maximum of $5 to process bankruptcy invoices for the life of the default. Refer to Guide Section 9301.30 for details on this fee.

State Registration Fee

Technology Fee

Initial property registration and the reregistration where applicable law requires a fee when conducting a foreclosure. Reimbursable up to a maximum of $500.

Reimbursable up to a maximum of $5 per referral, before 04/01/11, for the life of the default. Refer to Connectivity Fee.

Freddie Mac Special

Inspection

You must submit an RPA, along with supporting documentation, via the Reimbursement System, to request Freddie Mac’s prior written approval.

Principal Reimbursement Attach amortization schedule and loan history to reflect the unpaid principal balance for Super

Arc guaranteed loans.

Freddie Mac Document

4-17

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Other Legal

Expense Code+ Description

010012

013000

013104

014000

014004

032000

043006

300007

600021

600022

600023

Certificate of Regularity

Deed-in-Lieu of Foreclosure -

Attorney Fees

Suit on Note/Deficiency

Judgment

Receiver Fees

Additional Requirements and Information

None.

None.

You must submit an RPA, along with supporting documentation, via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

Receivership Additional Court

Appearance Cost

Sheriff/Auctioneer Fees - Other

Actions

Guardian Ad Litem

None.

All Recording Fees

You must submit an RPA, along with supporting documentation, via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

None.

Skip Trace/Investigative Report Reimbursable up to a maximum of $90.

Environmental/Department/

Violation Search – Other

Searches

None.

Courier/Overnight

Delivery/Certified Mail

Expense Reimbursement Desk Reference

March 2016 4-18

Freddie Mac Document

Expense and Income Codes

Property Repairs

Expense Code+

191006

191019

191033

191035

105002

200000

200001

201000

202000

203000

204000

205000

206000

207000

Description

Emergency Repairs

Fence Repair

Dehumidifier

Mold Treatment

Utilities Transfer

Roof Repair/Replacement

Gutter Repair/Cleaning

Interior Painting

Exterior Painting

Additional Requirements and Information

None.

As needed to repair or replace damaged sections of fence in order to secure pool area or property perimeter.

As needed to abate/prevent mold growth due to moisture.

Abatement of interior mold growth with nonprimer or non-paint-based chemicals intended for such use (e.g. bleach). A bid to remove mold must be submitted if treatment is not expected to abate further mold growth.

To be used when an on-site visit and wait time are required.

As needed, if active leak is present. Flat roofs must not be tarped; all other roofs, however, may be tarped if repair work cannot be completed within the expense limit.

As needed to prevent blight, roof damage and leaks.

You must submit an RPA, along with supporting documentation, via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

Servicing and restart. Sump Pump/HVAC

Repair/Replacement

Flooring Repair

Appliance Repair/Replacement

Other Repairs

Other Replacements

You must submit an RPA, along with supporting documentation, via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

You must submit an RPA via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

Freddie Mac Document

4-19

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Utilities

Expense Code+

100000

101000

102000

103000

105000

Description

Electric

Gas

Oil

Water

Other Utilities

Additional Requirements and Information

None.

You must submit an RPA, along with supporting documentation, via the

Reimbursement System, to request Freddie

Mac’s prior written approval.

+All expense codes require “from” and “to” dates for the period billed except for the mortgage modification program expense codes.

Applicable Jurisdictions *Yard Maintenance Season and

Frequency Requirements

Year Round (Monthly) AZ, NM and NV

AL, AR, CA, FL, GA, GU, HI, KS, LA, MS, OK,

SC, TX, VI and PR

AK

All others

Year Round (Semi-Monthly)

06/01-09/30 (Semi-Monthly)

03/01-10/31 (Semi-Monthly)

**Winterization Season Requirements

Not Permitted

Year Round

09/01-04/30

HI, GU, PR and VI

AK

All others

Jurisdictions

Expense Reimbursement Desk Reference

March 2016 4-20

Freddie Mac Document

Expense and Income Codes

Income Codes Listed by Activity Type

The following table identifies Freddie Mac’s income codes by activity type.

Activity

Escrow

Insurance

Refunds

Interest on

Escrow

Other

Income Code++ Description

811000

815060

815061

815062

815064

815065

Escrow Balance at DDLPI

(positive)

Property Insurance Premium

Refund

Flood Insurance Premium

Refund

Lender-placed Insurance

Premium Refund

Supplemental Windstorm

Coverage

Interest on Escrow

Additional Requirements

None.

None.

None.

None.

815000

Rental Income

Rental/Subsidy

Buydown

815050

815075

815077

815078

815079

815081

814000

812000

Other Income (Income received after DDLPI)

Mortgage Insurance Premium

Refund

Suspense Payments

Payments after DDLPI

Homeowners Association

(HOA) Refunds

Utility Refunds

Attorney Refunds

Rental Income

Provide a brief description of the item in the Comments section of the claim.

None.

None.

None.

Subsidy Fund

(buydown account)

None.

Freddie Mac Document

4-21

Expense Reimbursement Desk Reference

March 2016

Expense and Income Codes

Activity

Tax Refunds

Income Code++ Description

815070

815071

815072

815073

815074

County Tax Refund

Municipal, Borough, Town,

Village Tax Refund

School Tax Refund

Sewer Tax Refund

Supplemental Tax Refund

++ If available, provide “from” and “to” dates for the refund period.

Additional Requirements

None.

Note: For a listing of any previous expense codes not currently listed, refer to earlier versions of

Guide Exhibit 74, Expense and Income Codes for Expense Reimbursement Claims.

Expense Reimbursement Desk Reference

March 2016 4-22

Freddie Mac Document

Expense and Income Codes

City of Chicago, Illinois Vacant Property Ordinance Expense Codes

Effective May 12, 2014, you may not make advances using the expense codes listed below. The following is to be used only as reference when preparing claims to be submitted via the Freddie

Mac Reimbursement System for advances made prior to May 12, 2014.

Expense

Code

095005

Item

Ordinance*

Property

Registration

Description

Expenses incurred by registering the mortgaged premises with the City’s vacant property registration system including the registration fee and processing or administrative fees charged by the City, if any.

095007 Ordinance

Property

Inspection

Inspections of the type and frequency required by Guide

Chapters 9102 and 9201 must be submitted under the existing expense code found in Guide Exhibits 57 and 74.

Inspections of a type or frequency that are in excess of the

Guide must be submitted using this new code. For example, the Guide requires the first inspection to occur between the 45 th

and 60 th

day of delinquency and then monthly thereafter under certain circumstances. If the

City were to require two inspections in one month, expenses for the additional monthly inspection must be submitted using this new code.

095008 Ordinance Legal

Fee

Legal fees and expenses you incurred for defense against enforcement actions by the City resulting from the

Ordinance.

For example, if the City refused to accept a registration fee because it was made under protest and initiated a legal action against you as a result, you must submit the legal fees using this expense code.

We will review these fees and expenses on a case-by-case basis to determine whether we will reimburse you.

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Expense and Income Codes

Expense

Code

095010

095011

Item

Ordinance Yard

Maintenance

Expense

Ordinance

Window/Door

Security and

Boarding Expense

Description

Allowable expenses for reasonable yard maintenance such as mowing grass, pruning shrubs and removing dead plants, branches and trees between April 1 st

and

September 30 th

must be submitted under the existing expense codes found in Guide Exhibits 57 and 74.

Expenses for these activities incurred between October

1 st

and March 31 st

and for more extensive exterior yard maintenance activities, if required by the Ordinance, should be submitted under this expense code.

Locking and securing doors and windows, re-keying doors and boarding doors and windows that are broken, should be submitted using the existing expense codes found in Guide Exhibits 57 and 74.

Boarding windows and doors that are in good condition must be submitted under this code if the Ordnance or the specific jurisdiction requires those windows and doors to be boarded.

095012 Ordinance Security

Panel Monthly

Expense

Expenses for the monthly rental of steel security panels installed on the mortgaged premises. You must submit a request for pre-approval (RPA) for the expense each month the panels are rented.

Expenses incurred for the installation of steel security panels on the mortgaged premises.

095013 Ordinance Security

Panel Installation

Expense

095014 Ordinance Fence

Replacement and

Gate

Repairs/Replacement

Expense

Expenses for repair of fences must be submitted under the expense codes listed in Guide Exhibits 57 and 74.

Expenses for the complete or partial replacement of fences or the repair or replacement of gates should be submitted under this code.

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Freddie Mac Document

Expense and Income Codes

Expense

Code

Item Description

095015 Ordinance

Exterior Step and

Step Repair

Expense

Expenses for the repair or replacement of exterior steps or stairs of the mortgaged premises.

095016 Ordinance

Inspection Trip

Charge

095017 Ordinance Sign

Expense

Expenses incurred in order to give a City Inspector access to the mortgaged premises so that the City Inspector can conduct an independent inspection.

Expense incurred in posting a sign identifying the vacant property number and name of an authorized agent as required by the Ordinance.

095018 Ordinance

Authorized Agent

Expense

Expenses incurred in hiring an authorized agent to manage the mortgaged premises, if any.

095019 Ordinance

Expenses for

Repairs/

Maintenance

Required by City

Inspector

Expenses for repairs, maintenance or other activities that are required by a City Inspector, but are not provided by the Guide and do not fall under another Ordinance expense code in this exhibit. For example, if a City

Inspector required mortgaged premises that had already been winterized to be re-winterized, the expense should be submitted using this code.

*The use of these codes is limited to expenses arising from Sections 13-12-125, 126, 127 and

135 of the Municipal Code of the City of Chicago, Illinois ("Ordinance") for advances incurred prior to May 12, 2014.

You must use these Vacant Property Ordinance expense codes to submit expenses in the

Reimbursement System for activities that are required by the Ordinance but not required by the

Guide. You must submit the inspection, maintenance, repair and legal expenses described above that would not have been incurred but for the Ordinance using these codes.

Inspection, maintenance, repair and legal expenses that are incurred for activities that are already required by the Guide and expenses incurred must be submitted using the expense codes found in

Guide Exhibits 57 and 74.

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Freddie Mac Document

1 – 4 Unit Property Approved

Expense Amounts

5

This section outlines Freddie Mac’s approved limits for 1 – 4 unit properties. You must submit a request for prior approval (RPA) via the Reimbursement System to request our approval for fees and costs that exceed our expense limits. If you fail to obtain our prior written approval for expenses that exceed our limits, we may adjust your claim amount. For additional information about RPAs, refer to Chapter 6 in this desk reference.

Key Terms

The following defines the key terms associated with the expense amounts:

Term:

Expense Code

Expense Item

Description

Unit Price

Expense Limit

Definition:

The identifying six digit number, within the Reimbursement

System for each expense item.

The designated name, within the Reimbursement System, for a given expense type.

A brief description of the expense item and an overview of the expense item's proper usage.

The acceptable per unit cost for each applicable expense item.

You must comply with unit pricing guidelines when completing preservation work; unless you determine, after having secured a comparable second estimate, that the needed preservation work cannot be completed within the defined unit price limit. You may then proceed with completing work without seeking our approval if the lesser of the two estimates is within the applicable expense limit. You must retain both estimates in the mortgage file. (The second estimate may be one generated by an industry accepted Cost Estimator.)

The dollar amount within which you may complete needed work without seeking written pre-approval from us via the

Reimbursement System. Any work completed within the expense limit must also comply with the unit price requirements outlined above.

Refer to Guide Exhibits 57, 1-4 Unit Property Approved Expense Amounts, and 57A, Approved

Attorney Fees and Title Expenses, for additional information.

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1 – 4 Unit Property Approved Expense Amounts

Expense Amounts

Expense Item

Property Inspections

Description Expense

Code

404005

404007

404016

404017

Exterior Property

Inspection

Interior Property

Inspection

Ordinance

Required

Property

Inspection

(Weekly)

These property inspections must be completed in accordance with the requirements set forth in

Guide Section 9202.12.

Ordinance inspections are inspections required by local, state or federal statutes and that exceed the requirements set forth in Guide Section 9202.12. These inspections may be completed once a week or every other week.

Ordinance

Required

Property

Inspection

(Bi-weekly)

Expense

Code

Securing Abandoned Properties

Expense Item Description

090028

090019

090020

090021

090022

Securing (Knob

Locks)*

Securing

(Padlocks)

Securing (Slider

Locks)

If needed for access to, and/or securing of, the property.

Securing

(Window Locks)

Security Door

Unit

Price

N/A

N/A

N/A

N/A

Expense

Limit

$15

$20

$15

$15

Unit Price Expense

Limit

Up to $60 per knob lock

Up to $40 per padlock

Up to $25 per slider lock

Up to $25 per window lock

N/A

$200

$80

$50

$50

$250

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1 – 4 Unit Property Approved Expense Amounts

Securing Abandoned Properties, continued

Expense

Code

090030

090023

Expense Item Description Unit Price Expense

Limit

Boarding (Broken

Windows)*

Where needed, as required by local ordinances. All missing windows and doors should be boarded, not repaired.

Boarding (Doors)

As needed to secure non-access entryways with missing or broken doors.

Up to $1/

United

Inch

Up to $150 per door

$900

$300

Property Cleaning and Debris Removal

Expense

Code

091010

091009

091002

Expense Item Description Unit Price Expense

Limit

Interior Property

Cleaning

(Refrigerator)*

As needed, to remove all perishables from refrigerators, freezers and other appliances that may pose a risk of infestation to the property. Interior must be wiped down and free of hazards.

Interior Property

Cleaning (Toilets)

As needed, to remove waste from the toilet.

Trash Removal or

Dumping Fees

To be used as needed for the removal of health hazards and exterior debris. Interior debris that may pose a risk to the property must also be removed.

Exterior personals resulting in a violation or in the way of the grass being cut may be moved under the applicable unit price.

Up to $125 per refrigerator or freezer

Up to $75 per toilet

Up to $40 per cubic yard to remove

Up to $20 per cubic yard to move

$225

$225

$900

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1 – 4 Unit Property Approved Expense Amounts

Yard Maintenance

Expense

Code

093005

093004

094016

094013

094014

094015

Expense Item

Initial Yard

Maintenance

(Lots of up to

10,000 square feet)*

Description Unit Price Expense

Limit

To be used on properties with lots of 10,000 square feet or less. Full yard cut, weed removal or desert landscaping, as applicable, once per Yard Maintenance Season, as provided below.

Up to $120 $150

Initial Yard

Maintenance

(Lots greater than

10,000 square feet)

To be used on properties with lots greater than 10,000 square feet.

Full yard and/or perimeter cut, weed removal or desert landscaping, as applicable, once per Yard Maintenance Season, as provided below.

Up to $150 $300

Yard

Maintenance(Lots of up to 10,000 square feet)*

To be used on properties with lots of 10,000 square feet or less.

Semi-monthly full yard grass cuts, weed removal or desert landscaping, as applicable, during

Yard Maintenance Season, as provided below.

Up to $80 $100

Yard

Maintenance

(Lots greater than

10,000 square feet)

To be used on properties with lots greater than 10,000 square feet.

Semi-monthly full yard or perimeter grass cuts, weed removal or desert landscaping, as applicable, during Yard

Maintenance Season, as provided below.

Up to $120 $200

Trimming

(Shrubs)

As needed during Yard

Maintenance Season, as provided below.

Trimming (Trees)

As needed during Yard

Maintenance Season, as provided below.

N/A

N/A

$400

$600

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1 – 4 Unit Property Approved Expense Amounts

Yard Maintenance, continued

Expense

Code

Expense Item Description Unit Price Expense

Limit

191003 Snow Removal

Yard Maintenance Season and

Frequency Requirements

As needed during Winterization

Season (as outlined on the following page).

N/A

Applicable Jurisdictions

$75

Year Round (Monthly)

Year Round (Semi-Monthly)

06/01-09/30 (Semi-Monthly)

AZ, NM and NV

AL, AR, CA, FL, GA, GU, HI, KS, LA, MS, OK,

SC, TX, VI and PR

AK

03/01-10/31 (Semi-Monthly)

Expense

Code

090031

090025

090026

090027

All others

Pool Securing

Expense Item Description Unit Price Expense

Limit

Pool (In Ground

Pool Securing)*

Pool (Above

Ground Pool

Securing)

Covering or boarding of in ground pools.

Covering or boarding of above ground pools. Pool may be tarped if pool frame is unable to support weight of covering or boarding.

Collapsed pools may be moved to an exterior shed, garage or other secure structure on the property.

Up to

$2.05 per square foot

Up to

$2.05 per square foot to cover

Up to $20 per cubic yard to move

Pool Draining

To be used when draining pools, hot tubs, spas or ponds.

Pool (Hot Tubs or

Spa Securing)

Covering or boarding of hot tubs, spas or ponds.

N/A

N/A

$1,600

$400

$450

$50

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Winterization

Expense

Code

Expense Item Description Unit Price Expense

Limit

090032

095020

095021

095022

Winterization

(Dry)*

Winterization

(Wet/Steam)

Winterization

(Radiant)

Re-winterization

One time charge during

Winterization Season (see below).

One time charge during

Winterization Season (see below.)

One time charge during

Winterization Season (see below).

If necessary, once per calendar year.

N/A

N/A

N/A

N/A

$120

$175

$250

$50

095023

Winterization

(Additional Unit)

One time charge during

Winterization Season.

Up to $50 per additional unit

$150

Jurisdictions Winterization Season

Requirements

Not Permitted

Year Round

09/01-04/30

HI, GU, PR and VI

AK

All others

Expense

Code

Expense Item

Miscellaneous

Description Unit Price Expense

Limit

191006

203000

191033

Emergency

Repairs

Sump

Pump/HVAC

Repair or

Replacement

Dehumidifier

Servicing and restart as needed.

Existing hardware must be tested with a generator if electric is not on at the property.

As needed to abate/prevent mold growth due to moisture.

N/A

N/A

N/A

$600

$350

$300

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1 – 4 Unit Property Approved Expense Amounts

Miscellaneous, continued

Expense

Code

191035

200000

200001

191019

090029

090024

093003

090008

Expense Item

Mold Treatment

Roof Repair or

Replacement

Gutter

Repair/Cleaning

Fence Repair

Extermination

(Licensed)

Extermination

(Non-Licensed)

Pest Removal

Description Unit Price Expense

Limit

Abatement of interior mold growth with non-primer or nonpaint-based chemicals intended for such use (e.g., bleach). A bid to remove mold may be submitted if treatment is not expected to abate further mold growth.

As needed if active leak is present. Flat roofs must not be tarped; all other roofs however, may be tarped if repair work cannot be completed within the expense limit.

As needed to prevent blight, roof damage and leaks.

As needed to repair or replace damaged sections of fence in order to secure pool area or property perimeter.

Fumigation by a professional extermination company.

As needed to address infestation with over-the-counter products.

Removal of dead vermin from property.

Up to

$0.75 per square foot

Up to $2 per square foot

N/A

N/A

N/A

N/A

N/A

$300

$1,000

$350

$300

$350

$100

$75

Police/Fire

Report

N/A $20

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1 – 4 Unit Property Approved Expense Amounts

Utilities and Capping

Expense

Code

100000

101000

102000

103000

105002

100003

101001

103001

103002

105001

191034

Expense Item Description

Utilities: Electric Actual paid amount, does not include interest and penalties.

Utilities: Gas

Prior approval is not required for

Utilities: Oil the reimbursement of necessary

Utilities: Water utility expenses incurred from the

Due Date of the Last Paid

Installment (DDLPI) through to the date the Servicer receives the

Property Condition Certificate

(PCC) pursuant to Guide Sections

9202.12 and 8403.2.

Utilities Transfer

To be used when an on-site visit and wait time are required in the transfer or restoration of utilities.

Unit Price Expense

Limit

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A

N/A $75

Capping

(Electric)

Capping (Gas)

Capping (Water)

Capping (Sewer)

Capping

(Chimney)

Dryer Vent Cover

To be used if electric is on.

As needed to prevent damage to property.

As needed to prevent access to critters and small vermin.

Up to $2 per wire

Up to $50 per cap

Up to $50 per cap

Up to $50 per cap

Up to $250 per cap

N/A

$50

$150

$150

$150

$500

$50

Deed-in-Lieu and Other

Expense

Code

Expense Item Description Unit Price Expense

Limit

404008

Deed-in-Lieu

Property

Inspection

One time charge prior to deed execution.

N/A $20

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1 – 4 Unit Property Approved Expense Amounts

Deed-in-Lieu and Other, continued

Expense

Code

Expense Item Description Unit Price Expense

Limit

013005

013006

500002

Deed-in-Lieu

Borrower

Relocation

Assistance

Borrower

Relocation

Assistance

Deed-in-Lieu

Subordinate Lien

Payment

Reimbursable up to a maximum of $3,000 (Refer to Guide Section

9209.4 for details on this assistance).

Reimbursable up to a maximum of $3,000 (Refer to Guide Section

9301.21 for details on this assistance).

Reimbursable up to a maximum of $6,000 (Refer to Guide Section

9209.7 for details).

N/A

N/A

N/A

$3,000

$3,000

$6,000

Note: For a listing of any previous expense codes not currently listed, refer to earlier versions of

Guide Exhibit 57, 1-4 Unit Property Approved Expense Amounts.

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1 – 4 Unit Property Approved Expense Amounts

Attorney Fees and Title Work Expense Limits

The following table outlines Freddie Mac’s approved expense limits for attorney fees and costs, and title work. You must request our prior approval for attorney fees and costs that exceed our limits. If you fail to obtain our prior written approval for expenses that exceed our limits, we may adjust your expense reimbursement amount.

Foreclosure Attorney Fees

1, 2, 3

Title Work

4

State

Judicial Foreclosure

Attorney Fee

----

Trustee/

Non-judicial

Foreclosure

Attorney Fee

$1,350

Expense Limits

$365 Alabama

5

Alaska

5

Arizona

Arkansas

5

----

----

$1,600

$1,350

TSG

TSG

----

----

$1,400

$1,350

$365

TSG California

Colorado

5

Connecticut

----

$2,475

$1,675

----

Foreclosure Guarantee

$340

$1,800

$2,300

----

$1,200

$340

$365

Delaware

District of

Columbia

5

Florida

6

Georgia

5

Guam

5

Hawaii

$3,350

----

----

$3,350

----

$1,350

$1,600

----

$400

$375

$275

Litigation Guarantee

($400)

Idaho

5

Illinois

Indiana

----

$2,400

$2,400

$1,150

----

----

TSG

$365

$400

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Freddie Mac Document

1 – 4 Unit Property Approved Expense Amounts

Foreclosure Attorney Fees

1, 2, 3

Title Work

4

Iowa

State

Judicial Foreclosure

Attorney Fee

$1,950

Trustee/

Non-judicial

Foreclosure

Attorney Fee

----

Expense Limits

$575

Kansas

Kentucky

7

Louisiana

Maine

Maryland

5

Massachusetts

5

Michigan

5,8

Minnesota

5,8

The approved attorney fee for Torrens Act

(expense code 010002) is $500.

Mississippi

5

Missouri

5

Montana

5

Nebraska

Nevada

New Hampshire

5

New Jersey

9

New Mexico

New York

6,9

----

----

----

$1,950

----

----

$3,475

$2,000

$2,675

$1,950

$2,400

$2,000

$2,350

----

----

----

$1,800

$1,200

$1,350

$1,150

$1,150

$1,600

$1,350

----

----

----

----

----

----

----

$2,400

$2,550

$1,600

$1,600

$340

$375

$415

$340

$390

$425

$400

$275

$340

$340

TSG

$275

TSG

$340

$425

$475

$510

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1 – 4 Unit Property Approved Expense Amounts

Foreclosure Attorney Fees

1, 2, 3

Title Work

4

State

Judicial Foreclosure

Attorney Fee

$3,475

Trustee/

Non-judicial

Foreclosure

Attorney Fee

----

Expense Limits

$560 New York City

6,

9, 10

North Carolina

5

North Dakota

Ohio

7

Oklahoma

Oregon

----

$1,750

$2,550

$2,150

$2,950

$1,875

----

----

----

$1,350

$375

$375

$515

$475

TSG

Pennsylvania

Puerto Rico

Rhode Island

5

South Carolina

South Dakota

Tennessee

5

Texas

5

Utah

Vermont

11

Virgin Islands

Virginia

5

Washington

5

West Virginia

5

----

$2,550

$1,475

----

----

----

$2,400

$2,075

----

$2,275

$1,800

----

$1,800

$1,350

$1,600

----

$1,350

$1,350

$1,150

----

----

$1,800

----

----

$1,200

$1,350

TSG

$365

$425

$390

TSG

$525

$400

$310

$340

$375

$425

$365

$265

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1 – 4 Unit Property Approved Expense Amounts

Foreclosure Attorney Fees

1, 2, 3

Title Work

4

State

Judicial Foreclosure

Attorney Fee

$2,000

Trustee/

Non-judicial

Foreclosure

Attorney Fee

----

Expense Limits

$365 Wisconsin

Wyoming

5

---- $1,150 Foreclosure Title

Policy

Bankruptcy Attorney Fees

12

Chapter 7

Proof of Claim Preparation

13

Motion for Relief from Stay (up to two hearings and order)

Chapter 11 and 12

14

Proof of Claim Preparation, Plan Review and Plan

Negotiations

13

Objection of Plan (up to two hearings)

Motion for Relief from Stay (up to two hearings and order)

Agreed Order; Court Certification of Default/Stay Terminated

Agreed Order; Notice of Default/Stay Termination

Amended Plan Review

15

Chapter 13

Proof of Claim Preparation, Plan Review and Plan

Negotiations

13

Objection of Plan (up to two hearings)

Motion for Relief from Stay (up to two hearings and order)

Agreed Order; Court Certification of Default/Stay Terminated

Allowable Fee

$300

$750

$750

$500

$850

$200

$50

$150

$650

$500

$850

$200

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Bankruptcy Attorney Fees Allowable Fee

Agreed Order; Notice of Default/Stay Termination

Payment Change Notifications

Notice of Fees, Expenses and Charges

$50

$50

$100

Response to Final Cure Payment for Agreed Response

Response to Final Cure Payment for Dispute

Amended Plan Review

15

$50

$500

$150

Chapters 7, 11, 12, and 13

Multiple Filing Litigation

16

$500

Additional Hearings $200

1

Approved foreclosure attorney fees for an uncontested foreclosure. Additionally, these expense limits include the cost of any file setup fee charged to the law firm by Freddie Mac, as well as the services required in order to meet the reporting requirements pursuant to Guide Section 9501.10.

2

Deed-in-lieu of foreclosure – Freddie Mac will reimburse the Servicer up to $400 in attorneys' fees for the preparation and recordation of a release of mortgage. However, for mortgages referred to foreclosure prior to the Servicer's evaluation of a borrower for a deed-in-lieu of foreclosure, Freddie Mac will not reimburse the Servicer for any fees or costs associated with a deed-in-lieu of foreclosure if it is incomplete or unsuccessful.

3

Mediation attorney fees and court costs, when required by state or local law, as well as fees charged by a mediation manager or coordinator for participation in a pre-foreclosure mediation program are reimbursable with prior written approval from Freddie Mac in accordance with Guide Section 2405.8.

4

Expense limits for title work include the cost of an update to the title if required by the state, or to ensure clear and marketable title to the mortgaged premises after the foreclosure sale. Freddie Mac will not reimburse for any additional title abstract, commitment or policy. If the Servicer must obtain an additional update to the title because the original is stale due to bankruptcy delay, Freddie Mac will reimburse the

Servicer up to $125 for the update in Maryland, Ohio and Virginia, and $75 for all other states. Servicers must contact Freddie Mac for written pre-approval for an additional update if the title becomes stale for any other reason.

5

In these states, if a Servicer must restart a new foreclosure proceeding due to bankruptcy, where the

Servicer has restarted the foreclosure due to an approved workout option in accordance with Guide Section

9301.29, or due to a borrower being conditionally approved for mortgage assistance under the State

Housing Finance Agency program in accordance with Guide Section 9211.1. Freddie Mac will reimburse the Servicer as follows:

All of the actual costs of each foreclosure in accordance with the requirements of the Guide

 Up to 100% of the approved attorney or trustee's fees for the first foreclosure attempt

 Up to 70% of the approved attorney or trustee's fees for the subsequent foreclosure

 Freddie Mac will not reimburse Servicers for any fees or costs associated with a restart should the restart cause the foreclosure time line in Guide Exhibit 83, Freddie Mac State Foreclosure Time

Lines, to be exceeded

 Freddie Mac will not reimburse Servicers for any fees or costs associated with a restart should the restart be due to a failure to provide a timely foreclosure certification as provided in Guide Section

9301.29

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Freddie Mac Document

1 – 4 Unit Property Approved Expense Amounts

6

Freddie Mac will reimburse the Servicer up to an additional $1,750 in attorneys' fees for all work necessary to complete the bulk trial foreclosure process in accordance with Guide Section 9301.20, or to complete an inquest in accordance with Guide Section 9301.22.

7

The title work expense limit reflects the title search fee and the cost of an update to title only. If the state also requires a filed rate insurance product or premium, customarily referred to as the title preliminary report, then the Servicer can be reimbursed this additional amount as a cost by using expense code 300008

(Title Preliminary Cost).

8

Freddie Mac will reimburse the Servicer for attorney fees to shorten a redemption period, when allowed by applicable State law, if the Servicer has submitted and Freddie Mac has granted written pre-approval of the Servicer's request via the Reimbursement System.

9

Freddie Mac will reimburse the Servicer for attorney fees to foreclose on a Cooperative Share Mortgage, if the Servicer has submitted and Freddie Mac has granted written pre-approval of the Servicer's request via the Freddie Mac Reimbursement System.

10

Includes the five boroughs of New York City (Manhattan, Brooklyn, Queens, Bronx and Staten Island) as well as Nassau and Suffolk Counties.

11

The higher attorney fee listed is for cases where there is equity in the property, thus requiring a foreclosure by judicial sale.

12

If a case converts, Freddie Mac will reimburse the Servicer for up to the allowable legal fee for each of the chapters filed.

13

If a Mortgage Proof of Claim Attachment (Official Form 410A) must be filed with the Proof of Claim

(Official Form B410), Servicers can be reimbursed up to an additional $300.

Note: Until the Freddie Mac Reimbursement System can be updated accordingly, Servicers must obtain

Freddie Mac's written pre-approval for the additional reimbursement by submitting a request for preapproval (RPA) via the RPA functionality in the Reimbursement System for these bankruptcy expense codes.

14

Fees for Chapter 11 or Chapter 12, if otherwise not covered in the above reimbursement amounts, will also require pre-approval from Freddie Mac before incurring any excess expense.

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If the amended plan review is the result of the Servicer's action or inaction, then Freddie Mac would consider any associated bankruptcy costs and fees as non-reimbursable.

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If a borrower is a multiple-bankruptcy filer and petitions the court to extend the automatic stay, Freddie

Mac will reimburse the Servicer for up to $500 to file an objection to an extension of the automatic stay and attend the related court hearings. If the objection to an extension of the stay is denied and the Servicer must then protect Freddie Mac's interests in the bankruptcy proceeding, Freddie Mac will additionally reimburse the Servicer for the applicable bankruptcy fee, up to the allowable limit, for the chapter of bankruptcy filed.

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1 – 4 Unit Property Approved Expense Amounts

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Requests for Prior Approval

(RPAs)

6

What is a Request for Prior Approval (RPA)?

A request for prior approval (RPA) is a request seeking Freddie Mac’s prior approval:

 To exceed the allowable expense limits in Single-Family Seller/Servicer Guide (Guide)

Exhibits 57, 1-4 Unit Property Approved Expense Amounts, and 57A, Approved Attorney

Fees and Title Expenses

 To incur expenses as set forth in Guide Exhibit 74, Expense and Income Codes for

Expense Reimbursement Claims

 To incur expenses not be set forth in Guide Exhibit 74

 For an extension on the number of days to submit an expense reimbursement claim

Preparing and Submitting the RPA

Keep the following in mind as you prepare and submit the RPA:

 Ensure that you obtain our prior approval for fees and costs that exceed our expense limits in Guide Exhibits 57 and 57A by submitting an RPA. We may not reimburse fees and costs that exceed the expense limits if you request approval after you have incurred the expense. However, if unusual or emergency circumstances do not allow you to submit an RPA, then you must submit the request by the next business day after incurring the expense. If your determination to incur the expense was reasonable, as determined by

Freddie Mac, then we may reimburse the expense.

 When submitting the RPA, be sure to identify any fees or costs that you have incurred to date for an expense code, if any.

 All RPAs require supporting documentation. Examples of supporting documentation include, but are not limited to, the following:

− Notice of Hearing

− Copy of Motions

− Copy of Orders

− Photographs

− Violation/Ordinance Notices

 Freddie Mac will not provide prior approval for, or reimbursement for, certain items. For additional information, refer to Chapter 8, Non-Reimbursable Expenses.

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Requests for Prior Approval (RPAs)

RPAs for Property Preservation

When submitting an RPA for property preservation expenses, document the following in the Bill

Note section of the RPA:

 A description of the damage

 The date on which you were notified that the property was vacant

 The status of the utilities

 The property preservation history by expense type/code

 What will be done to address the source of the damage, if applicable

RPAs for Extension of Days

At times, due to circumstances beyond your control (e.g., a delayed invoice), you may be unable to submit an expense reimbursement claim within the required timeframe. When this occurs, you may submit an RPA to request up to 30 additional days in which to submit the claim.

Ensure you fully document the reason for the request in the Bill Note section of the RPA and attach supporting documentation to substantiate your request. The approved 30-day extension begins the day we approve the RPA.

If additional time is required beyond the 30-day extension, submit another RPA prior to the expiration of the first 30-day extension.

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Requests for Prior Approval (RPAs)

RPAs for Legal Fees

RPAs for legal fees and costs should include, at a minimum, the following information in the Bill

Note section:

 A thorough description of the request

 An explanation as to why the additional amount for the expense is required and/or in

Freddie Mac’s best interest

 A description of the work required, including an estimate of the attorney’s fees and litigation costs and the attorney’s hourly rate, if necessary or applicable, to justify the amount you are requesting

 The court or action date related to the request, if applicable

Remember to provide supporting documentation such as copies of court orders, motions, and briefs to substantiate your request.

Bankruptcy

Always ensure that you have met our expense limit prior to submitting an RPA for bankruptcy expenses, and ensure that you state this in the Bill Note section of the RPA. If only a portion of the expense limit has been incurred, be sure to indicate any amounts remaining when requesting our prior approval.

Mediation

Expenses related to pre-foreclosure mediation, when required by state or local law, require

Freddie Mac’s prior approval.

 Use expense code 010004 (Mediation Court Costs) to request prior approval for mediation court costs, as well as mediation manager or coordinator fees.

 Use expense code 010005 (Mediation Attorney Fees) when requesting prior approval to incur attorney fees for attendance and appearance at a mediation hearing or conference.

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Requests for Prior Approval (RPAs)

Contested Foreclosure and Non-Routine Litigation

All expenses related to contested foreclosure and routine/non-routine litigation require Freddie

Mac’s prior approval. Ensure that you document the information for legal fees outlined above in the Bill Notes section of the RPA.

RPAs for Transfer Taxes

After the foreclosure sale, or when closing a deed-in-lieu of foreclosure transaction, title to the property should be vested in a manner that does not result in an obligation to pay transfer taxes.

Freddie Mac will not reimburse you for any transfer taxes, unless all of the following conditions are met:

 Local authorities require you to pay the transfer tax in order to record a deed and ensure that title vests appropriately.

 The transfer tax is paid under protest.

 You submit an RPA for reimbursement of the transfer tax (expense code 074003) via the

Reimbursement System. (Refer to Guide Section 9701.15.) Ensure that you attach a copy of the pay under protest letter to the RPA. This type of RPA may be submitted prior to the foreclosure sale or within 45 days after the foreclosure sale.

 Counsel could not process the foreclosure and/or the deed-in-lieu of foreclosure transaction in a manner that would successfully avoid the imposition of the transfer tax obligation.

Freddie Mac will not reimburse transfer taxes if any of the above conditions and requirements do not exist or are not met.

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Expense Reimbursement Audits

7

Expense Reimbursement Audit Overview

Periodically, we select a random sampling of the claims you submitted and perform a more extensive audit to ensure compliance with our expense reimbursement requirements. You will be notified of any audit requests via the Reimbursement System and must respond within seven business days by submitting the standard supporting documentation.

If you do not respond within seven business days or your claim does not comply with our established guidelines, we may further adjust your expense reimbursement amount. We will notify you of the results of the audit.

The results of the audit may indicate that:

 Adjustments were required which resulted in additional funds due to you. We will remit the funds to you within 30 calendar days of the date we notify you of the audit findings.

 An expense was not eligible for reimbursement, in which case we will:

− Provide you with an explanation of the audit findings.

− Release the claim back to you or adjust the claim based on the audit findings.

If an expense that we previously reimbursed was not eligible for reimbursement, we will bill you for the amounts due back to us. These amounts due will display as a separate line item, 104 Expense, on your Servicer Non-Performing Loans Invoice.

 The claim is in compliance with our expense reimbursement requirements.

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Non-Reimbursable Expenses

8

List of Non-reimbursable Expenses

The Non-reimbursable Items section in the Reimbursement System allows you to document expenses you incurred that Freddie Mac identifies as non-reimbursable. If your internal accounting practices require that you report all incurred expenses, you may report the nonreimbursable expenses in the Non-reimbursable Items section of the Reimbursement System.

Freddie Mac considers the following items to be standard operating costs for Servicers, the attorney or broker and, as part of the cost of doing business, not reimbursable:

 Appraisal reports, except when approved by Freddie Mac in advance

 Attorney's fees resulting from correction of matters that should have been resolved before the foreclosure sale, including any costs to resolve real property title issues that are the result of Seller's or Servicer's actions or inactions

 Documentary stamp taxes/transfer taxes/excise taxes on real estate conveyance (Freddie

Mac is exempt under Title 12 of the United States Code, Section 1452(e)), unless you received Freddie Mac's prior written approval via the Freddie Mac Reimbursement

System

 Facsimile transmission (fax) charges

 Interest, penalties (except for the first tax penalty (and second tax penalty in California as provided in Guide Section 9701.6) incurred as defined in Guide Section 9701.6), late charges, or legal fees for late payment of taxes or homeowners association (HOA) assessments

 Long distance telephone calls

 Mailgram charges

 Mileage or travel costs

 Mortgage credit life insurance premiums

 Other costs of an attorney, such as time or fees for curing a delinquency, document preparation, word processing or notary public services performed by an attorney; cocounsel fees; referral fees, packaging fees or other similar fees and new case start-up fees

 Photocopy costs

 Photographs

 Regular postage

 The actual or imputed value of in-house counsel time expended when the reimbursable matter is handled by in-house counsel

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Non-reimbursable Expenses

 Additional fees for preparing a foreclosure deed because the cost of doing so is included in the attorney's fees listed in Guide Exhibit 57A, Approved Attorney Fees and Title

Expenses

 Credit reports

 Additional fees or service charges billed by a law firm, or any entities the firm relies upon to provide third-party support functions performed on the Servicer's behalf, that are considered included in the attorney's fees listed in Guide Exhibit 57A

 Additional fees or service charges that are billed by a law firm or any entity you rely upon and are associated with your functions. Servicers should pay vendors for handling such Servicer functions at their own expense.

For expenses that are considered non-reimbursable, you or your Permitted Vendors (see Guide

Section 2405.7 regarding use of the Reimbursement System by Permitted Vendors) should not be requesting Freddie Mac's written pre-approval by submitting a request for pre-approval (RPA) via the RPA functionality in the Reimbursement System for these expense amounts.

If Freddie Mac determines that you have directly or indirectly passed or charged to Freddie Mac any non-reimbursable expenses, or charged Freddie Mac for servicing obligations covered by the servicing spread (as set forth in Guide Section 8105.3), then Freddie Mac may pursue any or all remedies available under the Guide, other Purchase Documents and applicable law. (See Guide

Section 9301.3 regarding Freddie Mac's rights.)

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