Freddie Mac has added two conduits to its pipeline for nonconforming loans.
The Money Store Inc., Sacramento, Calif., and Ocwen Financial Corp., West Palm Beach, Fla., have agreed to buy subprime and jumbo loans evaluated through the Federal Home Loan Mortgage Corp.'s automated underwriting system.
Through Loan Prospector and Loan Underwriter, Freddie gives lenders a mortgage risk assessment and an approval or referral within minutes. The automated system grades borrowers using a risk scale developed by Standard & Poor's.
Lenders can then sell the loans to the conduits.
Freddie Mac was already linked with four other conduits: Indy Mac and its affiliates; Residential Funding Corp.; First Union Capital Markets; and Saxon Mortgage Inc.