When homeowners are working against the clock to stop a foreclosure date, knowing who backs your loan can make ALL the difference! In the case of Freddie Mac backed loans, we find ourselves explaining to potential clients why it can take time to get the clock stopped. It’s because of how the system is set up.

Here’s how it works for Freddie Mac residential single-family mortgages: 1) A homeowner sends the monthly payment to the lender or a mortgage servicer that manages the payments, 2) the servicer keeps a small fee for managing the borrowers’ payments and sends the rest of the monthly payment to Freddie Mac, 3) Freddie Mac passes through the remainder of the mortgage payment to investors who hold its mortgage securities.

So, if your loan is backed by Freddie Mac, investors gave Freddie Mac the funds so you could get your mortgage. That means the servicer/lender (like Chase, Wells Fargo, etc) have to take your short sale package and pass it on to Freddie, who then passes it to the original investors involved to have EVERYONE agree to postponing the foreclosure date. Here are some links to help you find out if your loan is backed by government interests…

Does Freddie Mac Own My Loan?

Does Fannie Mae Own My Loan?