Have you received a letter in the mail stating that your mortgage has been sold? If so, you‘re not alone and there is no reason to panic, states Dean Graziosi. There are many reasons why lenders sell a mortgage, you shouldn’t think that it was because you did something wrong. However, there are some things you should be aware of when you have to begin dealing with a new lender.
- Why Your Mortgage Was Sold – To any bank, your mortgage is simply another asset and the decision to sell this asset has nothing to do with you personally. It is common for lenders to sell mortgages to free up capital to fund future lending. It is simply a business move on the part of the banks to free up funds to lend to other individuals.
- Your New Lender – When your existing lender sells your mortgage to another lender, they are required by law to inform you of this change within 15 days. It is common that you will receive two letters during this time, one from your original lender and another from your new lender. In these letters you should find all of the information necessary to contact your new lender, including where and how to make your monthly mortgage payments. When a new lender purchases your loan, they do not have the power to modify the terms of your mortgage, so you shouldn’t expect an increase in your monthly payment.
- RESPA – The Real Estate Settlement and Procedures Act, is designed to provide homeowners with a grace period when your mortgage gets sold. This means that if you accidentally submit your payment to your old lender, that you will not be charged any penalties. After a mortgage is sold, you typically have a 60-day grace period in which the new lender is not allowed to charge you any late fees. During this time if your payment should be late, the new lender is not allowed to report the late payment to any credit agencies, so if you mistakenly send your payment to the old lender, your credit score will not be impacted.
- Check For Errors – While lenders are experienced in the buying and selling of mortgages, it doesn’t mean that they are always error free. This is why Dean Graziosi recommends that you carefully go over your mortgage statement from your old lender and compare it against the one from your new lender. This will help you notice any errors that may affect your payment amount or terms of your loan. If you notice that something does not look quite right, you should contact your new lender immediately. The sooner you act when you notice a discrepancy the sooner it can be resolved by the new lender.