What happens to my mortgage loan when it is sold to another lender?

1. What Happens To My Mortgage Loan When It
Is Sold To Another Lender?
Many people discover in their mail that a mortgage loan has been sold to another lending
company. This is not a reason to panic! The details in the loan agreement will not change
when sold, and a new lender should treat its customers with the same respect as another
group. With that said, there are a few key details to explain about this process.
Please note that the information contained herein is for general informational purposes only. If you are currently involved in a real estate transaction, please direct your
questions to your real estate professional, title officer or closing officer
Why was my mortgage sold to another
lender?
The chief concern of all business is making a
profit. However, the standard, fixed-rate loans
may seem great for the lending institution at
the time, but fluctuating interest rates can
quickly turn a loan at 7, 8 or 9% into a
seemingly bad deal, so the original lender might
sell the mortgage to another lender to cover
potential losses.
What happened to my deal? Will the new
lender honor it?
The fear of any borrower when a mortgage
changes hands lies in the rates and terms.
However, if Lender A sells a $500,000 mortgage
at 8.5% with $100,000 already paid (or any
other set of numbers), Lender B must accept it
for what it is. The original terms all apply: the
only change is where the payments are sent.
I knew I could trust the first group, but can
I trust the new one?
Advertisements constantly warn about identity
theft, and a mortgage’s change of hands could
make this threat seem more real. However, if
my mortgage loan is sold to another lender, the
original lender must notify me with the new loan-
holder’s physical address and phone number, as
well as the date the change goes into effect.
When contacted, the new lender should confirm
my loan information exactly.
So what do I do now that my mortgage has
been sold to another lender?
A borrower will never be released from debt
when a mortgage is sold. When my mortgage loan
is sold to another lender, it is my responsibility to
continue paying as scheduled. It is also my
responsibility to investigate the new company.
This can be done with a phone call to confirm the
loan details. If anything is suspicious, it is still my
responsibility to make an effort to pay the loan
while checking into the new lender; I can do this
by opening a new bank account to hold the
mortgage loan payments until they can be sent to
the lender, showing that I intend to continue
paying my loan.
Sara ForkelDivision Manager
Cell: (909) 573-6384
SaraForkel@gmail.com
— Same Team - Same Service - New Name! —