source:
  type: guide
  id: fhlmc-2405.1
  authority: Freddie Mac Single-Family Seller/Servicer Guide Section 2405.1 — Expense
    reimbursement process
  description: Freddie Mac Single-Family Seller/Servicer Guide Section 2405.1 — Expense
    reimbursement process.
  coverage_tier: operative
obligations:
- id: fhlmc-2405.1-full
  canonical_id: fhlmc-2405.1-full
  section: Freddie Mac Single-Family Seller/Servicer Guide Section 2405.1 — Expense
    reimbursement process
  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 2405.1 — Expense
      reimbursement process
    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: '2405.1: Expense reimbursement process (12/17/25) This section
      contains requirements related to: ■ Process for requesting expense reimbursement
      and for receiving reimbursement of expenses ■ Use of PAID (Payments Automated
      Intelligent and Dynamic) by Related Third Parties and process for Related Third
      Parties to receive reimbursement of expenses ■ Servicer bound by use of PAID
      (a) Process for requesting expense reimbursement and for receiving reimbursement
      of expenses The Servicer must submit a request for reimbursement via PAID (Payments
      Automated Intelligent and Dynamic) (available at https://sf.freddiemac.com/working-with-
      us/servicing/overview) in accordance with the requirements of this chapter:
      ■ Any Servicer submitting an expense reimbursement request for the first time
      must obtain access to PAID through Access Manager ■ Servicers may access the
      PAID Online Help Section for additional information and assistance with PAID
      To be reimbursed for expenses, Servicers must authorize Freddie Mac to make
      such payments and receive debits via Automated Clearing House (ACH) credit entries
      into their commercial checking accounts. Servicers must complete and execute
      Form 1132, in order to: ■ Authorize receipt of ACH credit entries; and/or ■
      Update previously submitted ACH credit account instructions Form 1132 must be
      submitted to Freddie Mac as an Electronic Record (as defined in Section 1401.1(b)),
      using a Portable Document Format (PDF) (or other Electronic Record format commonly
      used in the mortgage industry), that has been completed and contains the copy
      or representation of the pen and ink signature of the Authorized Employee (such
      copy or representation of the Authorized Employee’s signature shall be such
      Authorized Employee’s adopted Electronic Signature as defined in Section 1401.1(b).)
      Servicers may submit the completed form by either: Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 2405 As of 04/08/26 Page 2405-2 ■ Email: Attach
      to an e-mail and deliver to Freddie Mac at CashCollections@FreddieMac.com; or
      ■ Upload: Submit through the Freddie Mac eBill system Servicers may submit ACH
      credit-related questions or concerns to Expense@FreddieMac.com. The employee
      authorized to execute Form 1132 on the Servicer’s behalf must be designated
      as an “Authorized Employee” on the Servicer’s applicable certificate of incumbency
      form: ■ Form 988SF; or ■ Form 989SF Before a Servicer may receive expense reimbursements
      and incentive payments via ACH credit entries, the Servicer must have completed
      the certificate of incumbency (“COI”) process requirements in Section 2201.1,
      and Freddie Mac must have accepted the Servicer’s COI and all other required
      forms and documents. (b) Use of PAID by Related Third Parties and process for
      Related Third Parties to receive reimbursement of expenses (i) Access to PAID
      for Related Third Parties The Servicer may grant PAID access to one or more
      of its vendors which provide services in connection with Mortgages serviced
      for Freddie Mac. Each vendor is a “Related Third Party” within the meaning of
      the Guide. Related Third Parties are allowed access to PAID for the purposes
      of: ■ Submitting requests for pre-approval (RPAs) via the RPA functionality
      in PAID pursuant to Section 9701.1(c) ■ Submitting expenses for Servicer reimbursement
      based on the expense and income codes, subject to any associated expense limits,
      listed in Exhibits 57, 57A, 57B and 74, Expense and Income Codes for Expense
      Reimbursement Requests Note: Freddie Mac, at any time and in its sole discretion,
      may terminate a Related Third Party’s access to PAID and/or direct the Servicer
      to terminate a Related Third Party’s access. (ii) Servicer requirements for
      Related Third Party use of PAID The Servicer must comply with the following
      requirements related to use of PAID by a Related Third Party: Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 2405 As of 04/08/26 Page 2405-3 ■ The Servicer
      must ensure that Related Third Parties sign and comply with their separate,
      independent contracts under Sections 2401.1(e)(iii). The Servicer must maintain
      auditable records of such contracts ■ The Servicer must monitor its Related
      Third Party to ensure compliance with all applicable requirements of the Guide
      and any other Purchase Documents and applicable law and have written policies
      and procedures in place for doing so ■ The Servicer must have written policies
      and procedures in place that document its criteria for selecting Related Third
      Party and how the Servicer will monitor the Related Third Party’s use of PAID
      ■ The Servicer must periodically review and analyze the types and dollar amounts
      of expenses requested by Related Third Parties to ensure compliance with all
      applicable requirements ■ For property preservation services, if Freddie Mac
      requires that competitive bids be obtained from multiple vendors, the Servicer
      is responsible for obtaining the multiple bids and keeping records of the bids.
      (iii)Vendor COI process Before a vendor may receive expense reimbursements and
      incentive payments, the vendor must: ■ Complete the COI process requirements
      in Section 2201.1; and ■ Ensure Freddie Mac must have accepted the vendor’s
      COI and all other required documents. (iv) Reimbursement and incentive payments
      To be reimbursed for expenses and paid incentives (see Section 9204.3(a) regarding
      Servicer compensation for alternatives to foreclosure), Related Third Parties
      must: ■ Authorize Freddie Mac to make such payments and receive debits via ACH
      credit entries into their commercial checking accounts ■ Agree to authorize
      Freddie Mac to initiate ACH drafts from accounts designated on Form 98 for overpayments
      of expenses The employee authorized to execute Form 98 on the vendor’s behalf
      must be designated as an “Authorized Employee” on the vendor’s Form 99V. (v)
      Authorization process for ACH transactions Freddie Mac Single-Family Seller/Servicer
      Guide Chapter 2405 As of 04/08/26 Page 2405-4 To authorize receipt of ACH credit
      entries or to make changes to ACH credit account instructions previously provided,
      vendors must: ■ Complete and execute Form 98; and ■ Submit the form to Freddie
      Mac as an Electronic Record (as defined in Section 1401.1(b)) To submit your
      authorization documents for review, please adhere to the following steps: 1.
      Complete Form 98 as a PDF (or other Electronic Record format commonly used in
      the mortgage industry) that contains the copy or representation of the pen and
      ink signature of the Authorized Employee (such copy or representation of the
      Authorized Employee’s signature shall be such Authorized Employee’s adopted
      Electronic Signature as defined in Section 1401.1(b)) 2. Attach the completed
      form to an e-mail and deliver to Freddie Mac at the following e- mail address:
      Counterparty_Authorization@FreddieMac.com (c) Servicer bound by use of PAID
      By virtue of Servicer’s use of PAID, the Servicer agrees and is deemed to be
      bound by the provisions of: (i) Chapter 1401; (ii) Section 2401.1, (iii) this
      Chapter 2405; (iv) Chapter 9701; and (v) all other applicable terms and conditions
      of the Guide and other Purchase Documents. 2405.1: Expense reimbursement process
      (Future effective date 07/01/26) This section contains requirements related
      to: ■ Process for requesting expense reimbursement and for receiving reimbursement
      of expenses ■ Use of PAID (Payments Automated Intelligent and Dynamic) by Related
      Third Parties and process for Related Third Parties to receive reimbursement
      of expenses ■ Servicer bound by use of PAID (a) Process for requesting expense
      reimbursement and for receiving reimbursement of expenses Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 2405 As of 04/08/26 Page 2405-5 The Servicer must
      submit a request for reimbursement via PAID (Payments Automated Intelligent
      and Dynamic) (available at https://sf.freddiemac.com/working-with- us/servicing/overview)
      in accordance with the requirements of this chapter: ■ Any Servicer submitting
      an expense reimbursement request for the first time must obtain access to PAID
      through Access Manager ■ Servicers may access the PAID Online Help Section for
      additional information and assistance with PAID To be reimbursed for expenses,
      Servicers must authorize Freddie Mac to make such payments and receive debits
      via Automated Clearing House (ACH) credit entries into their commercial checking
      accounts. Servicers must complete and execute Form 1132, in order to: ■ Authorize
      receipt of ACH credit entries; and/or ■ Update previously submitted ACH credit
      account instructions Form 1132 must be submitted to Freddie Mac as an Electronic
      Record (as defined in Section 1401.1(b)), using a Portable Document Format (PDF)
      (or other Electronic Record format commonly used in the mortgage industry),
      that has been completed and contains the copy or representation of the pen and
      ink signature of the Authorized Employee (such copy or representation of the
      Authorized Employee’s signature shall be such Authorized Employee’s adopted
      Electronic Signature as defined in Section 1401.1(b).) Servicers may submit
      the completed form by either: ■ Email: Attach to an e-mail and deliver to Freddie
      Mac at CashCollections@FreddieMac.com; or ■ Upload: Submit through the Freddie
      Mac eBilling system Servicers may submit ACH credit-related questions or concerns
      to Expense@FreddieMac.com. The employee authorized to execute Form 1132 on the
      Servicer’s behalf must be designated as an “Authorized Employee” on the Servicer’s
      applicable certificate of incumbency form: ■ Form 988SF; or ■ Form 989SF Before
      a Servicer may receive expense reimbursements and incentive payments via ACH
      credit entries, the Servicer must have completed the certificate of incumbency
      (“COI”) Freddie Mac Single-Family Seller/Servicer Guide Chapter 2405 As of 04/08/26
      Page 2405-6 process requirements in Section 2201.1, and Freddie Mac must have
      accepted the Servicer’s COI and all other required forms and documents. (b)
      Use of PAID by Related Third Parties and process for Related Third Parties to
      receive reimbursement of expenses (i) Access to PAID for Related Third Parties
      The Servicer may grant PAID access to one or more of its vendors which provide
      services in connection with Mortgages serviced for Freddie Mac. Each vendor
      is a “Related Third Party” within the meaning of the Guide. Related Third Parties
      are allowed access to PAID for the purposes of: ■ Submitting requests for pre-approval
      (RPAs) via the RPA functionality in PAID pursuant to Section 9701.1(c) ■ Submitting
      expenses for Servicer reimbursement based on the expense and income codes, subject
      to any associated expense limits, listed in Exhibits 57, 57A, 57B and 74, Expense
      and Income Codes for Expense Reimbursement Requests Note: Freddie Mac, at any
      time and in its sole discretion, may terminate a Related Third Party’s access
      to PAID and/or direct the Servicer to terminate a Related Third Party’s access.
      (ii) Servicer requirements for Related Third Party use of PAID The Servicer
      must comply with the following requirements related to use of PAID by a Related
      Third Party: ■ The Servicer must ensure that Related Third Parties sign and
      comply with their separate, independent contracts under Sections 2401.1(e)(iii).
      The Servicer must maintain auditable records of such contracts ■ The Servicer
      must monitor its Related Third Party to ensure compliance with all applicable
      requirements of the Guide and any other Purchase Documents and applicable law
      and have written policies and procedures in place for doing so ■ The Servicer
      must have written policies and procedures in place that document its criteria
      for selecting Related Third Party and how the Servicer will monitor the Related
      Third Party’s use of PAID ■ The Servicer must periodically review and analyze
      the types and dollar amounts of expenses requested by Related Third Parties
      to ensure compliance with all applicable requirements Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 2405 As of 04/08/26 Page 2405-7 ■ For property
      preservation services, if Freddie Mac requires that competitive bids be obtained
      from multiple vendors, the Servicer is responsible for obtaining the multiple
      bids and keeping records of the bids. (iii)Vendor COI process Before a vendor
      may receive expense reimbursements and incentive payments, the vendor must:
      ■ Complete the COI process requirements in Section 2201.1; and ■ Ensure Freddie
      Mac must have accepted the vendor’s COI and all other required documents. (iv)
      Reimbursement and incentive payments To be reimbursed for expenses and paid
      incentives (see Section 9204.3(a) regarding Servicer compensation for alternatives
      to foreclosure), Related Third Parties must: ■ Authorize Freddie Mac to make
      such payments and receive debits via ACH credit entries into their commercial
      checking accounts ■ Agree to authorize Freddie Mac to initiate ACH drafts from
      accounts designated on Form 98 for overpayments of expenses The employee authorized
      to execute Form 98 on the vendor’s behalf must be designated as an “Authorized
      Employee” on the vendor’s Form 99V. (v) Authorization process for ACH transactions
      To authorize receipt of ACH credit entries or to make changes to ACH credit
      account instructions previously provided, vendors must: ■ Complete and execute
      Form 98; and ■ Submit the form to Freddie Mac as an Electronic Record (as defined
      in Section 1401.1(b)) To submit your authorization documents for review, please
      adhere to the following steps: 1. Complete Form 98 as a PDF (or other Electronic
      Record format commonly used in the mortgage industry) that contains the copy
      or representation of the pen and ink signature of the Authorized Employee (such
      copy or representation of the Authorized Employee’s signature shall be such
      Authorized Employee’s adopted Electronic Signature as defined in Section 1401.1(b))
      Freddie Mac Single-Family Seller/Servicer Guide Chapter 2405 As of 04/08/26
      Page 2405-8 2. Attach the completed form to an e-mail and deliver to Freddie
      Mac at the following e- mail address: Counterparty_Authorization@FreddieMac.com
      (c) Servicer bound by use of PAID By virtue of Servicer’s use of PAID, the Servicer
      agrees and is deemed to be bound by the provisions of: (i) Chapter 1401; (ii)
      Section 2401.1, (iii) this Chapter 2405; (iv) Chapter 9701; and (v) all other
      applicable terms and conditions of the Guide and other Purchase Documents.'
  judgment: false
