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Question:
Who is my "servicer?" Is my servicer the same as my lender or investor?
Answer:
Your loan servicer is the financial institution that collects your monthly mortgage payments and has responsibility for the management and accounting of your loan. It is possible that the owner of your mortgage also services it, however many loans are owned by groups of investors and these investors hire loan servicers to interact with homeowners on their behalf. Many lenders also have the loan servicers handle all contact with homeowners.
Traditionally, banks used money deposited in customers' savings accounts to make loans. They held the loans, earning the interest as homeowners repaid over time. Banks were thus limited in the number of loans they could make because they had to wait to make new ones until savings deposits grew or existing homeowners repaid their loans. Many families who wanted to own a home were unable to do so because there was not a steady supply of money for banks to lend.
Over time, banks started to turn loans into cash by pooling large groups of loans together to create mortgage backed securities that could be sold to investors such as pension funds and hedge funds. The investors get the right to collect future payments and the bank gets cash that it can use to make more loans. Investors hire loan servicers to collect payments and interact with customers.
If you have questions about your loan, or you are behind on your payments, you should call your loan servicer at the number on your payment coupon or monthly mortgage statement.
Question:
Is my servicer participating in HAMP?
Answer:
All servicers for loans owned or guaranteed by Fannie Mae and Freddie Mac are required to participate. Additional servicers are strongly encouraged to participate. The list of servicer participants will be updated at www.MakingHomeAffordable.gov/get-assistance/contact-mortgage/. (See "How do I know if my loan is owned or has been guaranteed by Fannie Mae or Freddie Mac?")
Question:
What should I do if my servicer tells me that the investor is not participating in the Making Home Affordable Program?
Answer:
Check to see if your servicer is listed on our servicer participant list at www.MakingHomeAffordable.gov/get-assistance/contact-mortgage/. Keep in mind that all servicers for loans owned or guaranteed by Fannie Mae and Freddie Mac are required to participate with respect to those loans. (See "How do I know if my loan is owned or has been guaranteed by Fannie Mae or Freddie Mac?")
If your servicer is on our participant list, or your mortgage is owned or guaranteed by Freddie Mac or Fannie Mae, call your servicer back and ask to speak to a supervisor. You may also contact a HUD-approved housing counselor for assistance.
If your servicer is not participating in the Program, ask your servicer or a housing counselor about other options that may be available.
Source:
www.makinghomeaffordable.gov/faqs/homeowner-faqs/Pages/default.aspx
Be sure to do your own due diligence in order to further educate yourself about this subject. Not meant as legal or professional advice.
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