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CUNA Regulatory Comment Call

March 15, 2001

EXECUTIVE SUMMARY

• The Federal Home Loan Mortgage Corporation (Freddie Mac) has released a second draft version of guidelines for the use, delivery, storage, and retrieval of electronic mortgages used in connection with mortgages that are offered for sale to Freddie Mac. The first draft was released in early November of last year. Click here for an analysis of the first draft, and click here for CUNA’s comment letter that was submitted in response to this first draft.



• These Guidelines are being issued as a result of the recent enactment of the Electronic Signatures in Global and National Commerce Act (E-Sign Act) and the Uniform Electronic Transactions Act (UETA), and also provides specific guidance that goes beyond the general provisions of the E-Sign Act and UETA.



• The Guidelines address issues such as consent, execution of the electronic signature, document format and delivery, document integrity, records management, and document access.

Comments on the Guidelines are due by April 16, 2001 (this is an extension from the original date of April 6). Please submit your comments to CUNA by April 13, 2001. Please feel free to fax your responses to CUNA at 202-371-8240; e-mail them to Associate General Counsel Mary Dunn at mdunn@cuna.com or to Assistant General Counsel Jeffrey Bloch at jbloch@cuna.com; or mail them to Mary or Jeff in c/o CUNA’s Regulatory Advocacy Department, 805 15th Street, NW, Suite 300, Washington, DC 20005. You may also contact us if you would like a copy of the Guidelines or you may access it on the Internet at the following address:

http://www.freddiemac.com/singlefamily/elm/index.html

For a printable copy of the entire comment call (22 pages) in PDF format, click here.

QUESTIONS TO CONSIDER REGARDING THE FREDDIE MAC GUIDELINES

• This draft of the Guidelines is divided into Rules, Policies, and Guidance. The Policies represent Freddie Mac requirements that are not required under law. Are there any Policies in the Guidelines that you believe should be changed?
  
  

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• The Guidelines allow consumers to request paper copies of closing documents, without charge. Would you be willing to provide these documents or should the Guidelines clarify that another party, such as the closing agent, should bear this cost?
  
  

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• Freddie Mac does not believe it is possible to provide detailed guidance to establish that an electronic signature is attributable to the person who has purported to sign the electronic record. Do you agree? Will you be comfortable in developing a process for ensuring such attribution?
  
  

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• Are the methods described for controlling access and preventing tampering too cumbersome? Are you aware of methods that would be less cumbersome?
  
  

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• The Guidelines offer the FFIEC’s standards as an example of guidance on records management. Are you aware of any other approaches with regard to records management?
  
  

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• With regard to hybrid transactions, the seller of the loan will be responsible for establishing the proper cross-references between the electronic and paper records. Is the seller the appropriate party that should have this responsibility?
  
  

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• Freddie Mac recognizes that various parties do not need access to all the loan records and that permitting global access raises privacy concerns. Do you have suggestions on improving how the Guidelines describe who has access to which documents?
  
  

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• Do you see other barriers to the use of electronic signature and mortgages that should be addressed in the Guidelines?
  
  

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• Other comments?
  
  

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