source:
  type: guide
  id: fhlmc-5501.7
  authority: Freddie Mac Single-Family Seller/Servicer Guide Section 5501.7 — Lender
    contributions
  description: Freddie Mac Single-Family Seller/Servicer Guide Section 5501.7 — Lender
    contributions.
  coverage_tier: operative
obligations:
- id: fhlmc-5501.7-full
  canonical_id: fhlmc-5501.7-full
  section: Freddie Mac Single-Family Seller/Servicer Guide Section 5501.7 — Lender
    contributions
  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 5501.7 — Lender
      contributions
    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: '5501.7: Lender contributions (09/03/25) This section contains
      information related to: Freddie Mac Single-Family Seller/Servicer Guide Chapter
      5501 As of 03/04/26 Page 5501-43 ■ Lender credit: definition and requirements
      ■ Lender incentive: definition and requirements (a) Lender credit: definition
      and requirements Lender credit is a contribution by the originating lender toward
      the Borrower’s Closing Costs. Lender credit must meet all of the following requirements:
      ■ The amount of lender credit must: ❑ Be derived from an increase in the interest
      rate (i.e., premium pricing), or ❑ Be funded directly by the lender ■ Lender
      credit must not require repayment ■ Third party funds must not be used to provide
      a lender credit ■ Lender credit may only be used as a credit towards the Borrower’s
      Closing Costs. In the event the lender credit exceeds the amount of the Borrower’s
      Closing Costs, the following requirements apply: ❑ The lender credit must be
      reduced so it does not exceed the amount of the Borrower’s Closing Costs, or
      ❑ The amount of the lender credit that exceeds the Borrower’s Closing Costs
      must be applied as a principal curtailment to the Mortgage and must be clearly
      reflected on the Settlement/Closing Disclosure Statement. (See Section 6302.32
      for delivery requirements for Mortgages with principal curtailments.) ■ Lender
      credit derived from an increase in the interest rate (i.e., premium pricing)
      must not be used as a credit towards funding a temporary subsidy buydown plan
      on a “no cash- out” refinance Mortgage (b) Lender incentive: definition and
      requirements Freddie Mac Single-Family Seller/Servicer Guide Chapter 5501 As
      of 03/04/26 Page 5501-44 A lender incentive is a cash or a cash-like contribution
      (e.g., a gift card), or other item of value that is: ■ Provided by the originating
      lender to the Borrower, directly or through a third party, and ■ Not a lender
      credit toward the Borrower’s Closing Costs Mortgages with lender incentives,
      as described above, are eligible for sale to Freddie Mac if they meet the following
      requirements, regardless of whether the incentive is provided before, on or
      after the Note Date: ■ No repayment of the incentive may be required ■ The cost
      or value of the incentive must not be funded through the Mortgage transaction
      (e.g., premium pricing) ■ The incentive must not be considered when qualifying
      the Borrower (e.g., as a source of funds for closing or reserves) ■ The lender
      incentive must be treated as a sales concession as described in Section 5501.6(c)
      if the originating lender is, or is affiliated with, an interested party to
      the transaction Note: A lender incentive is not considered cash out to the Borrower
      and does not have to be included in the calculation of the Mortgage proceeds,
      including the calculation of cash back to the Borrower. 5501.8: Automated asset
      assessment with Loan Product Advisor® using account data (09/03/25) This section
      contains: ■ Overview ■ Eligible and ineligible asset types and other sources
      of funds ■ Underwriting requirements ■ Data submission requirements, representation
      and warranty relief eligibility and documentation requirements Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 5501 As of 03/04/26 Page 5501-45 (a) Overview
      Representation and warranty relief eligibility is contingent on the Seller’s
      compliance with the requirements of this section. Asset and income modeler (AIM)
      automated asset assessment using account data provides Sellers with the option
      to use Loan Product Advisor® to determine whether a Seller is eligible for relief
      from enforcement of certain representations and warranties related to the Borrower’s
      assets. The Seller must obtain the Borrower’s account data and submit all required
      data and information to Loan Product Advisor. Based on the data submitted, Loan
      Product Advisor will assess for representation and warranty relief eligibility
      and return the results of the assessment on the Feedback Certificate. (b) Eligible
      and ineligible asset types and other sources of funds The following table describes
      eligible and ineligible asset types and other sources of funds for an automated
      asset assessment using account data: Freddie Mac Single-Family Seller/Servicer
      Guide Chapter 5501 As of 03/04/26 Page 5501-46 Eligible and ineligible asset
      types and other sources of funds for an automated asset assessment Eligible
      asset type Ineligible sources of funds The following asset types as described
      in Section 5501.3: ■ Depository accounts ■ Borrower’s business checking, savings
      and/or money market accounts. (See Section 5304.1(l) for additional requirements.)
      ■ Securities ■ Retirement accounts The Mortgage must not be a Mortgage for which
      any of the following are being used to qualify the Borrower: ■ Cash on hand
      ■ Assets that will be used by the Borrower for repayment of Borrower’s monthly
      obligations as described in Section 5307.1 The following other eligible sources
      of funds as described in Section 5501.4: ■ Gift funds or a gift of equity ■
      Gift funds received as a wedding gift ■ Gift funds received as a graduation
      gift ■ A gift or grant from an Agency (c) Underwriting requirements (i) General
      underwriting requirements For each verification report obtained, the Seller
      must confirm: ■ Each asset on the verification report is owned by at least one
      Borrower and such Borrower has access to the funds in the asset account ■ All
      assets shown on the verification report are in U.S. dollars located in a U.S.-
      or State-regulated financial institution ■ There are no outstanding loans secured
      by any of the asset accounts included on the verification report Freddie Mac
      Single-Family Seller/Servicer Guide Chapter 5501 As of 03/04/26 Page 5501-47
      (ii) Age of documentation For the age of the documentation, the expiration date
      of the verification report reflected on the Last Feedback Certificate complies
      with the requirements in Section 5102.4. (d) Data submission requirements, representation
      and warranty relief eligibility and documentation requirements (i) Data submission
      requirements For Mortgages with an automated asset assessment using Loan Product
      Advisor, the Seller must: ■ Submit the most current account data to Loan Product
      Advisor. If, after the initial submission, the Seller obtains an updated verification
      report, the Seller must resubmit the account data to Loan Product Advisor. ■
      Investigate and resolve any inconsistent or contradictory information between
      the verification report, information contained in Form 65, Uniform Residential
      Loan Application (including the Borrower’s asset representations), and the Mortgage
      file and, if applicable, resubmit to Loan Product Advisor with the correct information
      ■ Verify any funds required for the Mortgage transaction that are not included
      in the “Total Funds to be Verified” amount (e.g., Borrower is selling a property
      and needs to bring funds to the closing) and maintain the documentation in the
      Mortgage file (ii) Representation and warranty relief results on Feedback Certificate
      If multiple Loan Product Advisor submissions are made, Seller’s eligibility
      for representation and warranty relief will be based on the results on the Last
      Feedback Certificate. When asset representation and warranty eligibility results
      are provided on the Last Feedback Certificate, the representation and warranty
      relief available is described in the following table: Asset representation and
      warranty relief based on Feedback Certificate result Eligibility result Representation
      and warranty relief Eligible The Seller is relieved from enforcement of the
      following representations and warranties: 1. Sufficiency of the Borrower’s assets
      to cover the “Total Funds to be Verified” amount indicated on the Last Feedback
      Certificate, and Freddie Mac Single-Family Seller/Servicer Guide Chapter 5501
      As of 03/04/26 Page 5501-48 Asset representation and warranty relief based on
      Feedback Certificate result Eligibility result Representation and warranty relief
      2. Accuracy and integrity of the data on the verification report Partial The
      Seller is relieved from enforcement of the following representations and warranties
      contingent on Seller documenting additional requirements as indicated in feedback
      messages and the documentation requirements in Section 5501.8(d)(iii) below:
      1. Sufficiency of the Borrower’s assets to cover the “Total Funds to be Verified”
      amount indicated on the Last Feedback Certificate, and 2. Accuracy and integrity
      of the data on the verification report Not eligible The Seller is not eligible
      for relief from enforcement of representations and warranties related to the
      Borrower’s assets. Unavailable The Seller is not eligible for relief from enforcement
      of representations and warranties related to the Borrower’s assets. (iii)Documentation
      requirements based on representation and warranty relief result on Feedback
      Certificate When asset representation and warranty eligibility results are provided
      on the Last Feedback Certificate, the documentation requirements are described
      in the following table: Documentation requirements based on representation and
      warranty relief result on the Feedback Certificate Eligibility result Asset
      documentation requirements Eligible The verification report must be maintained
      in the Mortgage file. Partial The verification report must be maintained in
      the Mortgage file. Gift funds, grant funds, securities and retirement accounts
      must comply with the documentation requirements in Sections 5501.3 and 5501.4.
      The verification report is acceptable documentation to identify evidence of
      receipt of gift funds and grants from Agencies. Not eligible The assets must
      be verified and documented as required by the Guide. Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 5501 As of 03/04/26 Page 5501-49 Documentation
      requirements based on representation and warranty relief result on the Feedback
      Certificate Eligibility result Asset documentation requirements Unavailable
      The assets must be verified and documented as required by the Guide. (iv) “Large
      deposits” verification requirements For purchase transactions, Loan Product
      Advisor will issue feedback messaging identifying the amount of “large deposits”
      for which the Seller must document the source of funds. When a “large deposit”
      is identified by Loan Product Advisor but is composed of multiple items, the
      Seller must evaluate each item to determine whether it meets the definition
      of a “large deposit” (as described in Section 5501.1). If an item is not a “large
      deposit”, the Seller does not need to document the source of funds. For “large
      deposits” identified in the Borrower’s business checking, savings and/or money
      market accounts, the requirements in Section 5501.3(m) apply. Freddie Mac Single-Family
      Seller/Servicer Guide Chapter 5601 As of 05/06/26 Page 5601-1 Chapter 5601:
      Property Eligibility'
  judgment: false
