source:
  type: regulation
  id: fhlmc-4301.6
  authority: Freddie Mac Single-Family Seller/Servicer Guide §4301.6 — Special purpose cash-out refinance Mortgages
    (06/04/25)
  description: "Freddie Mac Guide §4301.6 (Special purpose cash-out refinance Mortgages). Gap-fill (verbatim, ID-diff).\
    \ \n"
obligations:
- id: fhlmc-4301.6-0
  canonical_id: fhlmc-4301.6-0
  section: Freddie Mac Guide 4301.6
  description: '4301.6 Special purpose cash-out refinance Mortgages: (06/04/25) A special purpose cash-out refinance
    Mortgage is a cash-out refinance Mortgage where the owner of a property uses the proceeds to buy out the equity
    of a co-owner. A special purpose cash-out refinance Mortgage must meet the loan-to-value (LTV)/total LTV (TLTV)/Home
    Equ…'
  type: do
  tags:
  - regulator-direct
  - gap-fill
  - fhlmc-guide
  - section-complete
  primary_source:
    tier: 1
    authority: Freddie Mac Single-Family Seller/Servicer Guide §4301.6 — Special purpose cash-out refinance Mortgages
      (06/04/25)
    source_class: gse-guide
    source_url: https://guide.freddiemac.com/
    snapshot_id: 5869ee9e606cd4ae
    fetched_at: '2026-06-18T00:00:00+00:00'
    content_hash: sha256:9a1b23e5024bb369e7a59d36b3702383c11ace68b5d209fdef791bc8f955c637
    paragraph_quote: '(06/04/25) A special purpose cash-out refinance Mortgage is a cash-out refinance Mortgage
      where the owner of a property uses the proceeds to buy out the equity of a co-owner. A special purpose cash-out
      refinance Mortgage must meet the loan-to-value (LTV)/total LTV (TLTV)/Home Equity Line of Credit (HELOC) TLTV
      (HTLTV) ratio requirements for cash-out refinance Mortgages in: ■ Section 5703.8(a) for Mortgages secured
      by a Manufactured Home ■ Section 4203.1(b) for all other Mortgages A special purpose cash-out refinance Mortgage
      must meet all requirements of the Guide that apply to cash-out refinance Mortgages, except as specifically
      modified below. This section contains requirements related to: ■ Allowable uses of proceeds from a special
      purpose cash-out refinance Mortgage ■ Special Borrower requirements ■ Documentation requirements ■ Credit
      Fees (a) Allowable uses of proceeds from a special purpose cash-out refinance Mortgage The loan amount of
      a special purpose cash-out refinance Mortgage is limited to amounts used to buy out the equity of the co-owner,
      which may include: ■ Paying off the first Mortgage, regardless of age ■ Paying off junior liens secured by
      the Mortgaged Premises. Note: The Borrower is not required to satisfy outstanding junior liens secured by
      the Mortgaged Premises if the requirements of Section 4204.1 for Mortgages with secondary financing and/or
      Section 4204.2 for Affordable Seconds®, are met. ■ Paying related Closing Costs (b) Special Borrower requirements
      The following requirements must be met:'
    drafter_attestation: Verbatim from Freddie Guide §4301.6 body (max-gap occurrence), snapshot 5869ee9e606cd4ae;
      substring-verified.
  judgment: false
- id: fhlmc-4301.6-1
  canonical_id: fhlmc-4301.6-1
  section: Freddie Mac Guide 4301.6
  description: '4301.6 Special purpose cash-out refinance Mortgages: 301-12 ■ The Borrower and the co-owner receiving
    the buy-out proceeds must have jointly owned the property for a minimum of 12 months prior to the initial loan
    application. (Parties who inherited an interest in the property are exempt from this requirement.) ■ The Borrower
    and th…'
  type: do
  tags:
  - regulator-direct
  - gap-fill
  - fhlmc-guide
  - section-complete
  primary_source:
    tier: 1
    authority: Freddie Mac Single-Family Seller/Servicer Guide §4301.6 — Special purpose cash-out refinance Mortgages
      (06/04/25)
    source_class: gse-guide
    source_url: https://guide.freddiemac.com/
    snapshot_id: 5869ee9e606cd4ae
    fetched_at: '2026-06-18T00:00:00+00:00'
    content_hash: sha256:9a1b23e5024bb369e7a59d36b3702383c11ace68b5d209fdef791bc8f955c637
    paragraph_quote: '301-12 ■ The Borrower and the co-owner receiving the buy-out proceeds must have jointly owned
      the property for a minimum of 12 months prior to the initial loan application. (Parties who inherited an interest
      in the property are exempt from this requirement.) ■ The Borrower and the co-owner receiving the buy-out proceeds
      must provide evidence that they occupied the subject property as their Primary Residence. (Parties who inherited
      an interest in the property are exempt from this requirement.) ■ The Borrower and the co-owner receiving the
      buy-out proceeds must provide a written agreement, signed by all parties, stating the property transfer terms
      of the property transfer and disposition of the refinance proceeds ■ The Borrower who retains sole ownership
      of the property may not receive any of the proceeds from the refinance transaction (c) Documentation requirements
      The Seller must retain the following in the Mortgage file: ■ Documentation evidencing that the Borrower and
      the co-owner jointly occupied the Mortgaged Premises as their Primary Residence, if applicable ■ A copy of
      the written agreement stating the terms of property transfer and the disposition of the refinance proceeds
      (d) Credit Fees The Seller must refer to Exhibit 19, Credit Fees, for Credit Fees related to special purpose
      cash-out refinance Mortgages. Credit Fees are paid in accordance with the Credit Fee provisions stated in
      Chapter 6303.'
    drafter_attestation: Verbatim from Freddie Guide §4301.6 body (max-gap occurrence), snapshot 5869ee9e606cd4ae;
      substring-verified.
  judgment: false
