source:
  type: guide
  id: fhlmc-5705.7
  authority: Freddie Mac Single-Family Seller/Servicer Guide Section 5705.7 — Exempt
    From Review
  description: Freddie Mac Single-Family Seller/Servicer Guide Section 5705.7 — Exempt
    From Review.
  coverage_tier: operative
obligations:
- id: fhlmc-5705.7-full
  canonical_id: fhlmc-5705.7-full
  section: Freddie Mac Single-Family Seller/Servicer Guide Section 5705.7 — Exempt
    From Review
  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 5705.7 — Exempt
      From Review
    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: '5705.7: Exempt From Review (09/30/25) This section contains
      requirements related to: ■ Eligible Mortgages ■ Cooperative Project eligibility
      ■ General Cooperative Project eligibility requirements ■ Additional requirements
      To be eligible under Exempt From Review, the requirements below must be met.
      (a) Eligible Mortgages The Mortgage must be one of the following: ■ A Freddie
      Mac-owned “no cash-out” refinance Cooperative Share Loan; or ■ A Refi Possible®
      Mortgage (b) Cooperative Project eligibility The Cooperative Project must: ■
      Not be a cooperative hotel, houseboat project, timeshare project or project
      with segmented ownership (all as described in Section 5705.3) ■ Not be in need
      of Critical Repairs (see Section 5705.3(q) for details) ■ Not have an evacuation
      order (see Section 5705.3(r) for details); and ■ Not be the subject of an action
      that would cause the Cooperative Project to cease to exist and not be the subject
      of an insolvency proceeding (see Section 5705.3(s) for details) Freddie Mac
      Single-Family Seller/Servicer Guide Chapter 5705 As of 01/26/26 Page 5705-30
      (c) General Cooperative Project eligibility requirements The general Cooperative
      Project eligibility requirements in Section 5705.2(b) must be met. (d) Additional
      requirements The following table describes additional requirements that must
      be met based on the type of Mortgage: Additional requirements by Mortgage type
      Mortgage type Requirements Freddie Mac-owned “no cash-out” refinance Cooperative
      Share Loan If the Cooperative Share Loan being refinanced is currently owned
      by Freddie Mac in whole or in part or securitized by Freddie Mac, then the Mortgage
      is exempt from project review provided the following requirements are met: ■
      The maximum loan-to-value (LTV)/total LTV (TLTV)/Home Equity Line of Credit
      (HELOC) TLTV (HTLTV) ratio is 80% ■ If available, proof of the ULDD Data Point
      Related Investor Loan Identifier of the existing Cooperative Share Loan is provided
      in the Mortgage file ■ The delivery requirements in Section 6302.45 are met
      Refi Possible Mortgage If the Cooperative Share Loan being refinanced is currently
      owned by Freddie Mac in whole or in part or securitized by Freddie Mac and the
      Mortgage is being refinanced under the Refi Possible offering, then the Mortgage
      is exempt from project review provided that: ■ The Mortgage meets all applicable
      requirements for Refi Possible Mortgages in Chapter 4302 ■ The delivery requirements
      in Section 6302.46 are met Freddie Mac Single-Family Seller/Servicer Guide Chapter
      5705 As of 01/26/26 Page 5705-31 5705.8: Appraisal requirements for Cooperative
      Units (01/26/26) Refer to Bulletin 2025-7, which announced the policy requirements
      for Uniform Appraisal Dataset (UAD) 3.6. Sellers may submit to the Uniform Collateral
      Data Portal® appraisal reports that use UAD 3.6 before the mandatory effective
      November 2, 2026 version of this section. This section contains requirements
      related to: ■ Cooperative Interest ■ General appraisal requirements for units
      in Cooperative Projects ■ Comparable sale requirements for units in Cooperative
      Projects The Seller must obtain an appraisal of the Cooperative Unit with an
      interior and exterior property inspection reported on Fannie Mae Form 2090,
      Individual Cooperative Interest Appraisal Report, which must be submitted to
      the Uniform Collateral Data Portal® (UDCP®) in accordance with the requirements
      in Chapter 5606 and must receive a “Successful” status before the Delivery Date
      of the Cooperative Share Loan. (a) Cooperative Interest The Cooperative Interest
      is the Cooperative Shares (or ownership interest) in the Cooperative Corporation
      and the related occupancy rights, excluding the Cooperative Interest’s Pro Rata
      Share of the underlying Blanket Mortgage. The Cooperative Interest is the equity
      portion that is over and above the Pro Rata Share of the Blanket Mortgage(s).
      (b) General appraisal requirements for units in Cooperative Projects When appraising
      a Cooperative Unit, appraisers must develop the opinion of market value for
      the Cooperative Interest. To determine the value of the Cooperative Interest,
      appraisers must report and analyze including, but not limited to, the following
      information: ■ Number of shares attributable to the subject unit ■ Number of
      shares issued and outstanding for the Cooperative Corporation ■ Lienholder name,
      lien position and the amount and repayment terms for all the Cooperative Project’s
      blanket financing ■ Pro Rata Share of the Blanket Mortgage payments attributable
      to the subject unit, determined by dividing the number of shares attributable
      to the subject unit by the total number of project shares Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 5705 As of 01/26/26 Page 5705-32 ■ Pro Rata Share
      of each lien attributable to the subject unit ■ Any tax abatements or exemptions
      that are attributable to the subject unit ■ Remaining term for any tax abatements
      or exemptions and provisions for escalation of real estate taxes (dollar amount
      by which the taxes will increase and the year in which the increase occurs);
      and ■ Monthly Maintenance Fees, including: ❑ Utility charges (if included in
      the fee) ❑ Special assessments ❑ Ground rent; and ❑ Other fees for the use of
      the facilities that are attributable to the unit (fee type, amount and term)
      This information can generally be developed through Fannie Mae Form 1074, Request
      for Cooperative Project Information, if the management agent, Cooperative Corporation
      or project sponsor/developer uses the form to respond to Seller or appraiser
      inquiries for project information. When Fannie Mae Form 1074 is used, appraisers
      may either report the appropriate information in the appraisal report form or
      attach the Fannie Mae Form 1074 to the appraisal report as an addendum. When
      reporting the information applicable to the Cooperative Unit and Cooperative
      Project, appraisers must: ■ Use reliable sources to obtain data on the Cooperative
      Project, the individual subject unit and the comparable properties and indicate
      each source by name on the appraisal report or an addendum to the appraisal
      report ■ Address any factors that could result in an increase to the monthly
      debt service for the subject unit ■ Indicate the dollar amount of the monthly
      Maintenance Fees for each of the comparable sales in the Sales Comparison Approach
      ■ Report the value of the Cooperative Interest, excluding the Pro Rata Share
      of the Blanket Mortgage(s). This value reflects the market value of the Cooperative
      Interest for the subject unit (e.g., if the indicated value of the unit encumbered
      by the Blanket Mortgage(s) is $100,000, and the unit’s Pro Rata Share of the
      Blanket Mortgage(s) is $25,000, then the market value estimate that the appraiser
      must report for the Cooperative Interest is: $100,000 − $25,000 = $75,000).
      Freddie Mac Single-Family Seller/Servicer Guide Chapter 5705 As of 01/26/26
      Page 5705-33 ■ Include a certification in the appraisal report that the Pro
      Rata Share of the Blanket Mortgage(s) on the real estate has not been included
      in the opinion of the market value of the Cooperative Interest (c) Comparable
      sale requirements for units in Cooperative Projects Appraisers must comment
      on the acceptance of housing cooperatives in the Market Area. The degree of
      acceptance is generally reflected in the availability of similar comparable
      sales data for Cooperative Units. If there is limited market acceptance of the
      cooperative form of ownership or if cooperative forms of ownership are relatively
      new in the Market Area, appraisers must address any effect that has on the value
      and marketability of the Cooperative Unit that is being appraised. The appraiser
      must compare the subject unit to the general Market Area as well as to other
      units in the subject Cooperative Project to demonstrate the market acceptance
      of Cooperative Units in the area. (i) General comparable sale requirements Comparable
      sales must be from similar types of projects that have similar Common Elements
      and recreational facilities, including, but not limited to, townhouses and mid-
      rise and high-rise buildings. Appraisers must use Cooperative Units as comparable
      sales when they are available. Appraisers may also use condominium units as
      comparable sales if Cooperative Units are not available, with an explanation
      for why those types of comparables were used. The appraiser must adjust the
      condominium comparables to reflect the reaction of the market to the Cooperative
      Unit when there is a preference for condominium ownership in the subject Market
      Area. (See Section 5605.6(g) for general requirements regarding comparable sales
      selection.) (ii) Comparable sale requirements for units in Established Cooperative
      Projects For Cooperative Units located in Established Cooperative Projects,
      the appraiser should use comparable sales from within the Cooperative Project
      when they are the best indicators of value for the subject property. The use
      of comparable sales that are located outside of the established subject Cooperative
      Project must be explained in the appraisal report. When the subject Cooperative
      Unit is in an Established Cooperative Project, appraisers should use the following
      as comparable sales: ■ Two comparable sales from within the subject Cooperative
      Project, when available; and ■ One comparable sale from a competing Cooperative
      Project Freddie Mac Single-Family Seller/Servicer Guide Chapter 5705 As of 01/26/26
      Page 5705-34 Note: See Section 5605.6(g) for general requirements regarding
      selection of comparable sales. (iii) Comparable sale requirements for units
      in recently converted or New Cooperative Projects If the subject Cooperative
      Unit is in a recently converted or New Cooperative Project, appraisers should
      use the following as comparable sales: ■ One comparable sale from the subject
      Cooperative Project, when available; and ■ Two comparable sales from outside
      of the Cooperative Project In the event the subject project is so new that a
      closed (settled) sale is not available, comparable sales from competing projects
      must be used. The appraiser must comment on the marketability of the new project
      and justify and support the use of the comparable sales from outside the Cooperative
      Project. Note: See Section 5605.6(g) for general requirements regarding comparable
      sales selection. 5705.8: Appraisal requirements for Cooperative Units (Future
      effective date 11/02/26) This section contains requirements related to: ■ Cooperative
      Interest ■ General appraisal requirements for units in Cooperative Projects
      ■ Comparable sale requirements for units in Cooperative Projects The Seller
      must obtain a Traditional Appraisal Report of the Cooperative Unit which must
      be submitted to the Uniform Collateral Data Portal® (UDCP®) in accordance with
      the requirements in Chapter 5606 and must receive a “Successful” status before
      the Delivery Date of the Cooperative Share Loan. (a) Cooperative Interest The
      Cooperative Interest is the Cooperative Shares (or ownership interest) in the
      Cooperative Corporation and the related occupancy rights, excluding the Cooperative
      Interest’s Pro Rata Share of the underlying Blanket Mortgage. The Cooperative
      Interest is the equity portion that is over and above the Pro Rata Share of
      the Blanket Mortgage(s). Freddie Mac Single-Family Seller/Servicer Guide Chapter
      5705 As of 01/26/26 Page 5705-35 (b) General appraisal requirements for units
      in Cooperative Projects The opinion of market value for a Cooperative Unit must
      be based on the Cooperative Interest. The appraisal report must include information
      and additional commentary as applicable including, but not limited to, the following:
      ■ Number of shares attributable to the subject unit ■ Number of shares issued
      and outstanding for the Cooperative Corporation ■ Lien position and the amount
      and repayment terms for all the Cooperative Project’s blanket financing ■ Pro
      Rata Share of the Blanket Mortgage payments attributable to the subject unit,
      determined by dividing the number of shares attributable to the subject unit
      by the total number of project shares ■ Pro Rata Share of each lien attributable
      to the subject unit ■ Any tax abatements or exemptions that are attributable
      to the subject unit ■ Remaining term for any tax abatements or exemptions and
      provisions for escalation of real estate taxes (dollar amount by which the taxes
      will increase and the year in which the increase occurs); and ■ Monthly Maintenance
      Fees, including: ❑ Utility charges (if included in the fee) ❑ Special assessments
      ❑ Ground rent; and ❑ Other fees for the use of the facilities that are attributable
      to the unit (fee type, amount and term) This information can generally be developed
      through Fannie Mae Form 1074, Request for Cooperative Project Information, if
      the management agent, Cooperative Corporation or project sponsor/developer uses
      the form to respond to Seller or appraiser inquiries for project information.
      The appraisal report must include the appropriate information in the “Project
      Information” and the “Cooperative Information” sections of the appraisal report.
      Fannie Mae Form 1074 may be included as an exhibit. When reporting the information
      applicable to the Cooperative Unit and Cooperative Project, appraisers must:
      Freddie Mac Single-Family Seller/Servicer Guide Chapter 5705 As of 01/26/26
      Page 5705-36 ■ Use reliable sources to obtain data on the Cooperative Project,
      the individual subject unit and the comparable properties and indicate each
      source by name on the appraisal report ■ Address any factors that could result
      in an increase to the monthly debt service for the subject unit ■ Indicate the
      dollar amount of the monthly Maintenance Fees for each of the comparable sales
      in the Sales Comparison Approach ■ Report the value of the Cooperative Interest,
      excluding the Pro Rata Share of the Blanket Mortgage(s). This value reflects
      the market value of the Cooperative Interest for the subject unit (e.g., if
      the indicated value of the unit encumbered by the Blanket Mortgage(s) is $100,000,
      and the unit’s Pro Rata Share of the Blanket Mortgage(s) is $25,000, then the
      market value estimate that must be reported for the Cooperative Interest is:
      $100,000 − $25,000 = $75,000). (c) Comparable sale requirements for units in
      Cooperative Projects The appraisal report must include comments on the acceptance
      of housing cooperatives in the Market Area. The degree of acceptance is generally
      reflected in the availability of similar comparable sales data for Cooperative
      Units. If there is limited market acceptance of the cooperative form of ownership
      or if cooperative forms of ownership are relatively new in the Market Area,
      the appraisal report must address any effect that has on the value and marketability
      of the Cooperative Unit that is being appraised. The subject unit must be compared
      to the general Market Area as well as to other units in the subject Cooperative
      Project to demonstrate the market acceptance of Cooperative Units in the area.
      (i) General comparable sale requirements Comparable sales must be from similar
      types of projects that have similar Common Elements and recreational facilities,
      including, but not limited to, townhouses and mid- rise and high-rise buildings.
      The appraisal report must use Cooperative Units as comparable sales when they
      are available. Condominium units may be used as comparable sales if Cooperative
      Units are not available and the appraisal report must include an explanation
      for why those types of comparables were used. Adjustments must be made to the
      condominium comparables to reflect the reaction of the market to the Cooperative
      Unit when there is a preference for condominium ownership in the subject Market
      Area. (See Section 5605.7(g) for general requirements regarding comparable sales
      selection.) (ii) Comparable sale requirements for units in Established Cooperative
      Projects For Cooperative Units located in Established Cooperative Projects,
      comparable sales from within the Cooperative Project should be used when they
      are the best indicators of Freddie Mac Single-Family Seller/Servicer Guide Chapter
      5705 As of 01/26/26 Page 5705-37 value for the subject property. The use of
      comparable sales that are located outside of the established subject Cooperative
      Project must be explained in the appraisal report. When the subject Cooperative
      Unit is in an Established Cooperative Project, the appraisal report should include
      the following as comparable sales: ■ Two comparable sales from within the subject
      Cooperative Project, when available; and ■ One comparable sale from a competing
      Cooperative Project Note: See Section 5605.7(f) for general requirements regarding
      selection of comparable sales. (iii)Comparable sale requirements for units in
      recently converted or New Cooperative Projects If the subject Cooperative Unit
      is in a recently converted or New Cooperative Project, the appraisal report
      should include the following as comparable sales: ■ One comparable sale from
      the subject Cooperative Project, when available; and ■ Two comparable sales
      from outside of the Cooperative Project In the event the subject project is
      so new that a closed (settled) sale is not available, comparable sales from
      competing projects must be used. The appraisal report must include commentary
      on the marketability of the new project and justification and support for the
      use of comparable sales from outside the Cooperative Project. Note: See Section
      5605.7(f) for general requirements regarding comparable sales selection.'
  judgment: false
