source:
  type: guide
  id: fhlmc-8103.1
  authority: Freddie Mac Single-Family Seller/Servicer Guide Section 8103.1 — Servicer
    fiscal responsibilities
  description: Freddie Mac Single-Family Seller/Servicer Guide Section 8103.1 — Servicer
    fiscal responsibilities.
  coverage_tier: operative
obligations:
- id: fhlmc-8103.1-full
  canonical_id: fhlmc-8103.1-full
  section: Freddie Mac Single-Family Seller/Servicer Guide Section 8103.1 — Servicer
    fiscal responsibilities
  type: do
  tags:
  - regulator-direct
  - fhlmc
  - freddie-guide
  - corpus-expansion
  - tier-operative
  primary_source:
    tier: 1
    authority: Freddie Mac Single-Family Seller/Servicer Guide Section 8103.1 — Servicer
      fiscal responsibilities
    source_class: fhlmc-guide
    source_url: https://guide.freddiemac.com/ci-guide
    snapshot_id: 5869ee9e606cd4ae
    fetched_at: '2026-05-23T00:27:40Z'
    content_hash: sha256:9a1b23e5024bb369e7a59d36b3702383c11ace68b5d209fdef791bc8f955c637
    paragraph_quote: '8103.1: Servicer fiscal responsibilities (07/09/25) This section
      contains requirements related to: ■ Balance sheet and financial statements ■
      Mortgage Servicing Rights (a) Balance sheet and financial statements The Servicer
      must prepare its balance sheet and other financial statements that clearly reflect
      the sale of Mortgages to Freddie Mac as a sale of assets. This is required in
      addition to the file identification and marking of accounting records required
      elsewhere in this Guide. (b) Mortgage Servicing Rights Each Servicer acknowledges
      and agrees that any reference to a “mortgage servicing right” or “MSR” in its
      books and records or in any other third-party contract related to the Servicing
      of Freddie Mac-owned Mortgages and/or related to the compensation Freddie Mac
      pays or may pay in the future to such Servicer (i.e., in the form of a Servicing
      Spread) is in fact a short- hand reference for the term “Servicing Contract
      Right”. Although some participants in the mortgage industry refer to MSRs and
      mortgage servicing rights, initially used as accounting terms, instead of the
      more appropriate and complete term “Servicing Contract Rights”, for precision,
      Freddie Mac generally, and the provisions of our Purchase Documents, will continue
      to use the term “Servicing Contract Rights”. Notwithstanding any extra-contractual
      meanings associated with the terms “MSR” and “mortgage servicing rights”, the
      terms “MSR” and “Mortgage Servicing Rights” (and any references to ownership
      thereof by any Servicer): (i) are for convenience purposes only as a result
      of industry and accounting convention (e.g., pursuant to generally accepted
      accounting principles), and (ii) in fact refer to Servicing Contract Rights
      (1) that are conditional in nature (e.g., may be terminated in whole or in part
      by Freddie Mac in its unfettered discretion) and (2) are not owned by the Servicer,
      but rather with respect to which a Servicer may have rights sufficient to satisfy
      UCC § 9-203(b)(2). Freddie Mac Single-Family Seller/Servicer Guide Chapter 8103
      As of 12/17/25 Page 8103-2 8103.2: Mortgage accounting records, methods and
      accounting with respect to delinquency relief (07/09/25) This section contains
      requirements related to: ■ Mortgage accounting records ■ Accounting methods
      ■ Accounting with respect to delinquency relief (a) Mortgage accounting records
      (i) Permanent records The Servicer must maintain permanent Mortgage accounting
      records for each Mortgage sold to Freddie Mac. The records must contain the
      complete Freddie Mac nine-digit loan number assigned to the Mortgage. (ii) Accounting
      system Freddie Mac requires that the Servicer’s Mortgage accounting system be
      able to produce an account transcript for each Mortgage, itemizing the following
      in chronological order: 1. The date, amount and breakdown of principal, interest
      and Negative Amortization of each payment 2. The date to which interest is paid
      3. The date, amount and nature of each disbursement, advance, adjustment or
      other transactions affecting the amounts due from or to the Borrower 4. The
      date, amount and nature of each disbursement, advance, adjustment or other transaction
      affecting the amounts due from or to the Borrower The system must also be capable
      of providing: ■ The current outstanding principal balance and Negative Amortization
      of the Mortgage ■ The current Escrow (impound) balance ■ Disclosure of any insufficiency
      in Escrow balances for a Mortgage (iii) Accounting principles Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 8103 As of 12/17/25 Page 8103-3 The Servicer must
      maintain the accounts and records for Freddie Mac-owned Mortgages according
      to sound and generally accepted accounting principles in a manner that permits
      Freddie Mac’s representatives or designees to examine and audit these accounts
      and records at any time. (b) Accounting methods (i) Amortization method The
      Servicer must use the amortization method of individual loan accounting, with
      interest calculated in arrears, for each Mortgage it services for Freddie Mac.
      Under this method, an individual Mortgage payment is applied to interest and
      principal by first calculating the interest portion and then applying the balance
      of the payment as a principal reduction. Below is information related to the
      interest calculation method: (A) Interest calculation method Unless otherwise
      specifically required by law, the interest portion of the payment must be determined
      by computing one full month’s interest on the outstanding principal balance
      (see Exhibit 62, Interest Calculation: Amortization Method – Full Month’s Interest)
      regardless of the day on which the payment is actually received. To determine
      the interest due for the month, multiply the outstanding principal balance by
      the interest rate of the Mortgage and divide by 12. Factors used for interest
      calculations must be carried to at least six decimal places, then rounded to
      the nearest decimal place based on the third digit. After applying the interest
      portion of the payment, the remainder is applied to principal. The Fannie Mae/Freddie
      Mac Uniform Instruments provide for this amortization method, unless the law
      of the State where the Mortgaged Premises is located specifically requires a
      different method. If applicable law specifically requires a different method,
      the Servicer must so notify Freddie Mac (see Directory 7) in writing before
      remitting payments to Freddie Mac. When computations involve multiple installments,
      such as several delinquent installments, the interest from each may be computed
      using the same principal balance (Exhibit 63, Interest Calculation: Amortization
      Method – Multiple Installments on Same Principal Balance). The amount to be
      applied to interest from each installment also may be calculated in succession,
      using the principal balance remaining after the previous calculation and principal
      application (Exhibit 64, Interest Calculation: Amortization Method - Multiple
      Installments on Respective Principal Balances). Similarly, a method that strictly
      applies payments according to a predetermined amortization schedule is also
      acceptable. (B) Payment calculation for Initial InterestSM Mortgages Freddie
      Mac Single-Family Seller/Servicer Guide Chapter 8103 As of 12/17/25 Page 8103-4
      For Initial Interest Mortgages, the monthly payment will be interest-only followed
      by fully amortizing principal and interest payments beginning on the First Amortizing
      Payment Date. For Initial Interest Mortgages, Servicers must have the ability
      to produce monthly payment statements for Borrowers. In addition, for Initial
      Interest 3/1, 5/1 and 7/1 10-year Interest Only Period ARMs, Servicers must
      be able to track the first Interest Change Date and the First Amortizing Payment
      Date separately. (ii) Interest calculations involving a period of less than
      one month For interest calculations involving a period of less than one month
      (e.g., Mortgages paid in full or third-party sales), the amount of interest
      must be based on actual days and a 365-day year. (iii) Interest-in-advance Freddie
      Mac does not permit the use of the prepaid interest or interest-in-advance methods
      on Mortgages purchased. Any Servicer using the interest-in-advance method must
      convert to the interest-in-arrears method for Mortgages purchased by Freddie
      Mac before delivering the Mortgages to Freddie Mac. (c) Accounting with respect
      to delinquency relief Freddie Mac’s Servicing requirements regarding delinquency
      relief are described in Chapter 9203. These sections should be read in conjunction
      with the accounting requirements in this section. When delinquency relief has
      been granted, the Servicer must apply funds collected from the Borrower according
      to the governing Note or repayment agreement. Regardless of cash collected from
      the Borrower, the Servicer must report to Freddie Mac in accordance with the
      net yield reporting concept. Freddie Mac will receive its proportionate share
      of principal collections and the Accounting Net Yield interest for the monthly
      reporting period.'
  judgment: false
