OVERVIEW Product Summary

Freddie Mac Whole Loan Securities (WLS) is a fully collateralized, non-synthetic issuance of guaranteed senior and non-guaranteed subordinated certificates. WLS is a credit risk transfer securitization backed by single-family mortgages purchased by Freddie Mac. Principal and interest payments on the underlying mortgage loans, whether received from borrowers or advanced by Freddie Mac as Master Servicer, provide the funds for distributions of principal and interest to investors and payment of certain expenses of the WLS trust. Additionally, Freddie Mac, in its role as Guarantor, will guarantee timely interest and ultimate principal payments to the senior certificates. Investors in non-guaranteed, subordinate certificates may not receive full payments of either principal or interest on the certificates as a result of realized losses on the mortgage loans in the WLS trust.


  • Mortgage loans deposited into the securitization trust are eligible for delivery to Freddie Mac under the Guide
  • Representations and warranties (R&W) provided by Sellers to Freddie Mac, and the enforcement and sunsetting of those R&W, remain unchanged from the Guide
  • Principal payments on the mortgage loans are allocated on a pro rata basis between the senior and subordinate certificates, sequentially amongst the subordinate certificates (provided certain performance and collateral tests are met)
  • Freddie Mac as Seller provides a discrete set of representations and warranties to the Trust
  • Freddie Mac’s will initially retain a 5% vertical slice of each of the subordinate securities, demonstrating an alignment of interest with investors
  • Subject to certain deal level triggers, principal payments on the mortgage loans are allocated on a pro rata basis between the senior and subordinate certificates and sequentially amongst the subordinate certificates

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