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Even when mortgage rates were at record or near-record low levels earlier this year, there was an increase in the number of adjustable- rate mortgage loans sold in the secondary market to Freddie Mac, a company executive said.
As a result, there have been changes made to Freddie Mac's Single Family Seller/Servicer guide that makes it easier to sell ARMs indexed to the London interbank offered rate to the company.
In a move that makes it easier to originate ARMs in general, Freddie Mac has reduced the servicing spread for all ARM products from 0.375% down to 0.25%. The lower minimum servicing spread gives lenders more flexibility when selling ARM and balloon/reset products, the company said.
Freddie Mac has seen...