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Mortgage payments: Freddie Mac feels your pain (and is doing something about it)

Aly J. YaleThe Mortgage Reports Contributor

Partnering up for better mortgage payments

Freddie Mac is taking steps to make mortgage payments a little bit easier on its customers. The government-sponsored enterprise (GSE) announced a partnership with EarnUp, a fintech firm that automates payments, provides budgeting assistance and helps consumers improve their financial health.

Verify your new rate (Aug 20th, 2018)

Empowering the borrower

Through EarnUp, borrowers with Freddie Mac-backed loans will be able to manage all their debts in one central location. They will then “receive personalized recommendations on how to pay down their debts,” according to a press release.

The platform also allows borrowers to set up smaller, automatic withdrawals on each payday. This ensures they’re never hit with huge, end-of-the-month mortgage payments they don’t have the funds for. These “bite-sized payments” should make it easier on consumers to stay on top of their debts and avoid late fees.

“Our experience shows that people are more likely to stay current on their loan payments if we make it quick and easy for them to do so,” said Matthew Cooper, co-founder and CEO of EarnUp.

The power behind the partnership

The goal of Freddie Mac’s latest venture is two-fold. According to the GSE itself, EarnUp will “reduce the likelihood of delinquency while improving savings opportunities.”

Danny Gardner, Freddie’s VP of affordable lending, says the partnership will fill a much-needed void in the industry.

“The increasing rate of consumer debt and the low homeownership rate lead us to believe that average Americans could use help managing their debts,” Gardner said. “We believe EarnUp’s online platform is an innovative and convenient approach that may help the next generation of potential homebuyers meet their future goals.”

Leveraging the tech

Consumers can take advantage of the Freddie Mac-EarnUp partnership through one of three financial counseling organizations: HomeFree-USA, GreenPath Financial Wellness and InCharge Debt Solutions. The program will roll out on a larger scale in the near future, Gardner says.

“Experimenting on a relatively small scale allows us to easily evaluate the results,” Gardner said. “With the insights we gain, we’ll be better able to develop other initiatives to support low- and moderate-income consumers in the future.”

A refinance could help

Are you having trouble paying off your mortgage debt, but can’t access one of these programs? Consider refinancing instead. Take a look, and see what rates you qualify for today.

Verify your new rate (Aug 20th, 2018)