Freddie Mac Mortgages Must Comply With Address Privacy Program
As of yesterday, any new funded Freddie Mac mortgage will have to comply with the state’s Address Privacy Program (PCA) requirements. PCAs are state sponsored programs designed to protect victims of crime such as domestic violence, sexual assault, criminal harassment or human trafficking for additional damage. ACP recently have been extended to others, such as healthcare workers and public health officials. Although the ACPs have been in force since at least 1991, with Washington State being the first to pass such a law, they have gone largely unnoticed in many privacy programs. However, these lesser-known laws are now increasingly recognized in the corporate compliance world.
By keeping a victim’s home, work and / or school address confidential, PCAs act as a shield to prevent perpetrators from finding – and continuing to harm – their victims. PCAs work by providing a “designated address” for victims to use instead of their physical (or real) address. When used correctly, the designated address diverts a victim’s mail to a confidential third-party location (often a PO box and / or a “lot number”), after which a public body forwards the mail to the real address of the victim. Additionally, and perhaps most importantly, the ACP prohibits those with knowledge of a victim’s whereabouts information from disclosing it to other parties. In this way, the ACP seek to protect the physical location and safety of victims.
While the obligation to accept and use ACP “designated addresses” (and the corollary designation to keep actual addresses confidential) only applies to government entities in many states, there are a handful of States which also apply these obligations to private entities.
Some private companies, however, have chosen to extend the protections of state ACP law to all clients who identify as victims, whether or not the underlying state law requires these obligations. Likewise, Freddie Mac, choosing to expand the scope of these obligations, issued a bulletin on September 1, 2021 requiring all sellers to notify Freddie Mac of a borrower’s alternate ACP mailing address. Additionally, within five business days of the fundraising date, the seller must email Freddie Mac with the following information:
Freddie Mac Loan Number
Borrower’s ACP postal address (including, where applicable, any lot number or unique identification number required)
Previously, Freddie Mac did not have a process to identify borrowers participating in a PCA. Freddie Mac said in his newsletter that the new guidelines answered questions about his process for victimized borrowers.
Freddie Mac has also updated his delivery instructions for ULDD Data Point Borrower Mail To Address Same As Property Indicator (Sort ID 572) to specify that “false” should be selected when the mailing address is not the same as the mortgaged premises and to add a reference to the notification obligation (see the impact guide: Articles 1301.2 and 6302.9).
© 2021 Bradley Arant Boult Cummings LLPRevue nationale de droit, volume XI, number 336