(HINT: REMEMBER TO INPUT EXTRA PAYMENTS AS A NEGATIVE NUMBER!)

Most individual mortgages in the United States become packaged as complex financial instruments known as, “mortgage backed securities,” also known as “MBS.”  One of the main roles that Fannie Mae and Freddie Mac play in the mortgage market is to bundle mortgages into these bond pools and them sell them to investors.  Don’t be confused.  Just because your home loan statement is from Wells Fargo, Chase, GMAC, or another bank – that doesn’t mean they own it.  It may simply mean that they “service” it or collect your payments on behalf of the investors behind-the-scenes.

This might seem academic, but if your home has little to no equity and you can’t refinance, it could be very advantageous for your loan to be owned by Fannie or Freddie because the government is making it easier for them to refinance people in their bond pools.  One of the first steps to take is to find out whether your loan is owned by Fannie or Freddie by clicking on one of these links:

Fannie Mae Loan Lookup

Freddie Mac Loan Lookup

If your loan is not owned by Fannie or Freddie it may be because it is an FHA loan, a portfolio loan, or may have been bundled by another investor / hedge fund.  It is uncertain whether these non-Fannie / Freddie loans will be able to benefit from some of the government initiatives.  We will keep you posted!