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GSEs’ Mandate: No More Defective Loans
Fannie Mae and Freddie Mac have created new quality control programs to flag problem loans early. The government-sponsored enterprises are electronically validating 100% of the loans they purchase. Lenders will be subject to loan reviews and risk assessments, and if loans have any defects at all, lenders will be asked to take them back much sooner than they would have in the past. Lenders say they will need to hire more staff to help them comply with the new mandate, which takes effect in January.Image: Fotolia