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ALERT: Fannie Mae/Freddie Mac Instructions for Lenders <br />SINGLE FAMILY HOME OWNERS: In May, 2010, Fannie Mae and Freddie Mac, <br />government sponsored enterprises that purchase a large segment of conforming single <br />family home mortgages, issued new instructions to lending institutions on how to treat <br />properties with assessments under Property Assessed Clean Energy (PACE) programs <br />such as . These letters, and additional statements issued by the Federal <br />Housing Finance Agency, the agency that regulates single family home lenders, instruct <br />lenders to treat energy assessments as ({loans" instead of {{assessments." <br />On August 31, 2010, the agencies issued additional instructions to lenders that Fannie <br />Mae and Freddie Mac "will not purchase mortgage loans secured by properties with an <br />outstanding PACE obligation." <br />These letters and statements may lead lenders to conclude the PACE assessment <br />should be paid off before a property transfers or is refinanced. In addition, it may lead <br />some lenders to conclude that participating in PACE program is a violation of typical <br />mortgage terms prohibiting prior liens without lender consent. If you are selling your <br />property, a buyer's lender may refuse to finance the buyer's first mortgage loan unless <br />the assessment is paid off. We urge you to carefully read the disclosure information in <br />the Program application, review your mortgage documents, evaluate the risks of <br />proceeding with an application at this time, and contact your lender if you have any <br />concerns or for information regarding any other financing options that may be available <br />to you. <br />I/We have read the above statement. All property owners on title must initial below: <br />Initials Date Initials Date <br />Initials Date Initials Date <br />Continued on next page: <br />Electronic links to the copies of letters from the Federal Financing Housing Authority re: <br />programs: