No, we do not believe that your bank is required to use a Fannie/Freddie rider for a mortgage loan that will not be sold to Fannie Mae or Freddie Mac.

The Fannie/Freddie Second Home Rider, Form 3890, is required for first lien loans secured by a second home that will be sold to Fannie Mae or Freddie Mac. This rider modifies the Fannie/Freddie uniform security instrument to replace references to the borrower occupying a property as a “principal residence” to occupying the property “as Borrower’s second home” or as “a residence.” Our understanding is that Fannie and Freddie will not purchase second lien loans secured by a second home, which likely explains why this rider is required only for first lien loans.

Since your bank is not selling this loan to Fannie or Freddie, you are not required to use their forms, including the second home rider. However, if your bank is opting to use the Fannie/Freddie uniform security instrument for this loan, it may be prudent to use the second home rider due to the clarifications on the borrower’s occupancy status noted above.

For resources related to our guidance, please see:

• Fannie Mae/Freddie Mac, Multistate Second Home Rider (Form 3890) (rev. 4/19) (“6. Occupancy. Borrower will occupy and use the Property as Borrower’s second home. . . . 8. Borrower’s Loan Application. . . . Material representations include, but are not limited to, representations concerning Borrower’s occupancy of the Property as Borrower’s second home.”)

• Fannie Mae, Multistate Second Home Rider (Form 3890), Summary (“Use This Document For . . . Lien Type: First.”)