Freddie Mac Single-Family Seller/Servicer Guide 4606.2 — Determination of value for the loan-to-value
Freddie Mac Single-Family Seller/Servicer Guide section 4606.2 — Determination of value for the loan-to-value. Full verbatim section text, substring-verified against snapshot 5869ee9e606cd4ae.
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Verbatim provisions from Freddie Mac Single-Family Seller/Servicer Guide 4606.2 — Determination of value for the loan-to-value — each quote is a verified substring of the regulator-published source snapshot, not retyped. Quoted for reference; this is not legal advice. The operational layer (P&P updates, prompts) lives in the regulation update kits.
Freddie Mac Single-Family Seller/Servicer Guide 4606.2 — Determination of value for the loan-to-value
(LTV)/total loan-to-value (TLTV)/Home Equity Line of Credit (HELOC) TLTV (HTLTV) ratio, underwriting requirements and qualifying ratios (11/06/24) This section contains requirements related to: ■ Determining value ■ Underwriting ■ Qualifying ratios for Manually Underwritten Mortgages (a) Determining value The value used to calculate the loan-to-value (LTV) ratio, the total LTV (TLTV) ratio and the Home Equity Line of Credit (HELOC) TLTV (HTLTV) ratio must be determined as follows: The value used to calculate the LTV/TLTV/HTLTV ratio Mortgage purpose Value Purchase transaction The value is the lesser of: ■ The “as completed” appraised value of the Mortgaged Premises; or The value used to calculate the LTV/TLTV/HTLTV ratio Mortgage purpose Value ■ The total acquisition cost (i.e., the price paid for the Mortgaged Premises plus the cost of the eligible improvements) If the total acquisition cost is used, the Mortgage file must contain documentation of the costs used to calculate the total acquisition cost. “No cash-out” refinance used to finance eligible improvements The value is the “as completed” appraised value of the Mortgaged Premises. “No cash-out” refinance used to pay an Existing Debt The value is the appraised value of the Mortgaged Premises. (b) Underwriting The Mortgage must be an Accept Mortgage or a Manually Underwritten Mortgage. (c) Qualifying ratios for Manually Underwritten Mortgages For Manually Underwritten Mortgages, see Section 5401.1(e)(ii)(B) for additional requirements for calculating the monthly housing expense-to-income ratio and the monthly debt payment-to-income ratio.
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Source of record: https://claudeforcompliance.com/regs/fhlmc-4606-2/
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