Freddie Mac Changes Radon and ACM Requirements for Multi-Family Phase 1 Reports

Earlier this year, Freddie Mac recently clarified its environmental requirements for phase 1 reports issued for multi-family loans. The two key changes involve radon and asbestos. Excerpts for these two issues are below. The full text of the revisions are available from the link at the bottom of this post.


Freddie Mac now requires radon sampling for ALL multi-family projects regardless of radon zone. The agency explanation is as follows:

“Recent changes to language in the Freddie Mac Multifamily Seller/Servicer Guide (Guide) have attempted to correct misconceptions regarding radon. We generally expect radon to be tested on every property. Radon concentrations are site specific and the risk cannot be adequately determined based on the EPA radon zones. The EPA specifically notes that the zone designations should not be used as a determinate in the testing decision. While there may be limited legitimate reasons that Freddie Mac will consider for waiving radon testing, location in a particular EPA zone is not among them.  All elevated radon results require further testing and, in addition, the consultant must indicate the cost of potential remediation”


Freddie Mac expressed concern that consultants are not adequately identifying suspect ACM. Thus, it has eliminated the cutoff for sampling suspect friable ACM. The explanation is as follows:

“The required asbestos scope is often not fully addressed. Some consultants still do not consider the potential risk from asbestos due to the building age and/or do not test all suspect friable materials. Asbestos is still being produced and imported into this country, so there is no cutoff date that allows the risk analysis to be dismissed. Freddie Mac does not allow friable materials with concentrations above 10 percent to remain in place so all friable materials must be tested to determine the asbestos content.”

Phase 2 Recommendations-

Freddie Mac also is apparently going to expect sampling for USTs where there is no historic test results and dry cleaners with documented spills. Here is the statement:

“Issues such as underground tanks with no historical test information or a dry cleaner with a documented spill, will likely require on-site testing to adequately evaluate the environmental risk before the report is issued.”

Property Condition and Environmental Reports: Common Issues and Best Practices





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