Compliance

Freddie Mac Updates Flood Insurance Section of Seller/Servicer Guide

Freddie Mac recently issued Servicer Bulletin 2026-14 to Servicers announcing updates to flood insurance requirements for Condominium Projects with greater than 25% commercial space, along with other miscellaneous revisions to its guidelines. The update to Section 4703.3 of the Freddie Mac Single-Family Seller/Servicer Guide is effective December 6, 2026.

The bulletin adds greater specificity to master flood insurance requirements for these projects as follows:

• The maximum coverage amount available from the National Flood Insurance Program (NFIP) per unit will refer to coverage available under the Residential Condominium Building Association Policy (RCBAP) form, currently $250,000 per unit.
• If the commercial space of an attached condominium building is over 25%, coverage provided by the NFIP’s General Property Form (currently $500,000 per building) is insufficient. The homeowners association must maintain a private flood insurance policy, or a private flood insurance policy in conjunction with a General Property Form policy , to equate to coverage requirements for condominiums eligible for an RCBAP.

This update aligns Freddie Mac’s requirements with Fannie Mae’s existing guidelines. Fannie Mae adopted substantially similar requirements for condo projects with over 25% commercial space in Selling Guide Announcement SEL-2018-09 and Servicing Guide Announcement SVC-2018-09, effective March 1, 2019. These requirements are currently reflected in Fannie Mae Selling Guide B7-3-06, Flood Insurance Requirements for All Property Types.

Servicers must implement the applicable changes effective December 6, 2026.

For additional details, please refer to:

• • Freddie Mac: Servicer Bulletin 2026-14  (October 14, 2026)

We encourage all clients to review the bulletin and guides in their entirety for additional information and effective dates for other miscellaneous announcements.

Proctor Loan Protector is actively reviewing this update and assessing potential impacts to flood insurance tracking processes. If Proctor provides tracking services for your entity, relationship managers will reach out as the review progresses to discuss any changes that may be required to your business rules.