Many borrowers will receive a letter from Fannie Mae or Freddie Mac at some point advising them that the loan has been sold to them. But that does not mean they should pay Fannie or Freddie directly. They should also look out for a welcome letter from their new Servicer with more details on who will be handling their payments and other activity going forward.
There are a lot of things going on after a loan closes, but one of the biggest events to follow is when Gold Star sells the loan to a new Investor. Most of the time that means selling the loan to Fannie Mae or Freddie Mac. They will then hold that balance and all the principal and interest paid by the borrower is sent to that new Investor. When ownership of the loan changes, the new Investor may send a letter to the new borrower to advise them of what’s going on.
But it is important to remember that Fannie Mae and Freddie Mac are not mortgage Servicers. That means they will not handle the day-to-day responsibilities of managing a mortgage, including collecting payments, monitoring escrow accounts, answering questions from borrowers, and more. Therefore Gold Star must also decide what to do with the servicing rights for the recently closed loan. Sometimes we will keep ownership of those rights and transfer the loan to our Subservicing vendor. Other times we will sell those servicing rights to another mortgage Servicer in the industry.
To put it simply: The borrower can disregard the Fannie or Freddie letter and watch out for welcome information from their new mortgage servicer.