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Guaranteed and Insured Loans

Mortgage loans can be different in ways that aren’t always obvious.  Two homeowners whose loans have the same interest rate, term, and principal balance may be eligible for different workout options or alternatives to foreclosure if their loans are insured by different entities.  In some cases, what kind of loan you have will make a difference as to whom you can contact to “escalate” your case if your bank isn’t working with you.  

What Types Of Mortgage Loans Are There?

Home mortgage loans can be divided into two types – conventional and government insured loans.  Government insured loans are guaranteed by the federal government and include FHA (Federal Housing Administration), VA (Department of Veterans Affairs) and  RHS (Rural Housing Service)/USDA(United States Department of Agriculture) loans

Conventional loans are loans made by a private institution without a guarantee or insurance from a government agency and include Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”) loans. 

Fannie and Freddie don't make loans.  Rather, they buy mortgages from banks and other lenders, package them as bonds, guarantee them against default and sell them to investors. Together, Fannie and Freddie own or guarantee about half of U.S. mortgages.  Add that to the loans insured by the above federal agencies and together they back about 90% of new mortgages.

What Type Of Mortgage Loan Do You Have?

Click on the links below to find out how to tell whether you have one of the listed loans.

 

 

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This website provides general legal information and not legal advice.  The law is complex and changes frequently. 
Before you apply any general legal information to a particular situation, consult an attorney. 
If you cannot afford an attorney call 1-866-Law-Ohio (1-866-529-6446) or visit OhioLegalServices.org for your closest legal aid office.

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