Freddie Mac is preparing a transaction that transfers credit risk on $639.9 million of super conforming residential mortgages.

The Freddie Mac Whole Loan Securities Trust, Series 2017-SC01 will issue two tranches of senior securities that are guaranteed but not rated. It will also issue two mezzanine tranches that are not guaranteed, but carry ratings of Baa1 and Ba3 from Moody’s Investors Service. The most subordinate tranche, which represents a first-loss position, is unrated.

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