Audit and The Guide - Freddie MacFreddie Mac Multifamily AMO Workshop - Audit and the Guide Author:...
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Audit and The Guide 2017 Asset Management & Operations Servicer Workshop
Transcript of Audit and The Guide - Freddie MacFreddie Mac Multifamily AMO Workshop - Audit and the Guide Author:...
Audit and The Guide
2017 Asset Management & Operations Servicer Workshop
© Freddie Mac
Customer Compliance Management
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Explore Audit and the
Guide, and how it
impacts you
Session Agenda
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The Guide Team
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Tracey MerrillProduct Mgmt Manager
Ann Richardson
Product Mgmt Senior
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© Freddie Mac
Official Guide is posted on AllRegs®
Seller/Servicers may access the Guide free of charge via FreddieMac.com
The Guide and all its terms are incorporated by reference into each
Purchase Contract
Servicing of Securitized Mortgages is governed by the Loan Documents
and the PSA, which may refer to the Guide as the “Servicing Standard”
The Freddie Mac Seller/Servicer Guide
(The Guide)
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© Freddie Mac
Servicing Standard
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Guide Amendments
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Guide Bulletins consist of changes to Guide Sections and a Cover
Letter describing the changes
» AllRegs Alerts® - Guide Bulletin
publication notifications
» Bulletin Cover Letter and Customer News
article posted on FreddieMac.com
Cover Letter announces effective date of changes; effective date is in
the heading of each revised section
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Recent Guide Amendment
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Freddie Mac monitors Seller/Servicers and their transactions to:
» Ensure compliance with the Servicing Standards of the Guide, the PSA and
the Loan Docs
» Identify and correct any Servicing deficiencies that pose risk to Freddie Mac or
the Seller/Servicer
» Identify opportunities to improve our requirements, processes, or guidance to
benefit the Seller/Servicer or the Borrower
Monitoring
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The Audit Team
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Erik LarsonAudit Manager
Marshall KassAudit Senior – Team Lead
Steven CatoAudit Senior
Gilbert SheltonAudit Senior
Matthew OgundeyiAudit Professional
Samina ShaikhAudit Professional
Brett MartinReal Estate Analyst
© Freddie Mac
Audits require advance planning and are completed over several
months of continual work and correspondence:
Engagement Letter to final audit report = ~100 days
Audits Timeline
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Audit Milestone Example Timeline of ABC Mortgage Workflow Timeline
Scheduling Contact for Audit Date October 15 October of Prior Year
Scheduling Confirmation Letter for Audit Date November 15 November of Prior Year
Engagement Letter to Seller/Servicer March 6 (35 Workdays Before)
Audit Documents Due from Seller/Servicer April 10 (10 Workdays Before)
Audit Fieldwork April 24 (Audit Week)
Complete Test Work May 1 (5 Workdays After)
Preliminary Findings Report May 19 (10 Workdays After)
Draft Audit Report for Seller/Servicer Response June 5 (30 Workdays After)
Final Audit Report to Seller/Servicer June 14 (40 Workdays After)
Projected SSPR Presentation Date July 7 (55 Workdays After)
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Most Frequent Seller/Servicer Audit Issues
(2015 & 2016)
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Issues by Audit Area
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What Works:
Special Characteristics – Servicers should review the loan documents
and create a series of ticklers to ensure better monitoring of any special
loan characteristics
Loan Level Insurance Coverage – Servicers should have well-trained
staff, standard procedures and robust tracking systems to ensure
continuous and correct insurance coverage and proper endorsements
Repairs – Items part of Repair Agreements should be proactively
managed and extensions requested in advance of stated repair deadlines,
even in the absence of Borrower direction
Best Practices for Top Audit Issues
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Have a single point of contact for the audit
Double-check that responses to the Engagement Letter are complete
and timely
Upload and label documents to DMS as accurately as possible
Promptly respond to questions during the audit
Communicate audit status and results to all internal stakeholders
How to Survive Our Audits
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Questions? Contact…
Erlita Shively Senior Director [email protected] 703-714-2746
Erik Larson Audit Manager [email protected] 703-714-3644
Ann Richardson Guide Senior [email protected] 703-714-2849
Tracey Merrill Guide Manager [email protected] 703-714-2849
