What You Should Do If Your Mortgage Loan is Sold

It is not uncommon for mortgage loans to be sold between companies during the time that you are repaying the loan. Sometimes lenders go out of business or something else happens and they decide to sell the servicing rights of your loan to another company.

When your mortgage loan gets sold, the first thing to remember is that it is normal for this to happen. There is no reason for panic or get worried. In fact, you probably agreed to it in the first place. If you read the documents that the lender gives you before getting your loan, you will probably see in the fine print that there is a possibility that your loan will get sold to another investor during the term of your repayment.

When this happens, the original lender must send you a letter telling you that your loan has been sold to another investor. In addition to that, the investor that is buying your loan must send you a letter telling you that they have purchased your loan. Both of these parties must provide you certain information according to federal law. That information includes the following:

• The original lender, or the one you currently make your payments to, must send you a letter at least 15 days before you have to make your next payment. This letter must tell you in the letter that your loan is being sold. It must also tell you the new investor’s name, the new investor’s phone number, the full address and the name of someone you can speak with at the new investor’s office.
• The investor that has purchased your mortgage loan must send you a letter with the same information – their address, phone number, name of a contact person and any other helpful information you would need in order to make a payment.

The federal government requires that these lenders and investors must do this to avoid homeowners from getting scammed. There was a time not too long ago when scammers were sending letters to homeowners telling them that they purchased their mortgage loan. The homeowners would then send their payments to a post office box when, in fact, their loan had never been sold. The unsuspecting homeowners had no idea that they were being scammed until they received delinquent notice from their real mortgage loan holder.

If you don’t get a letter from your original mortgage lender telling you that your loan is being sold but you receive a letter from another party saying that they have purchased your mortgage loan, start making some phone calls. Your first call should be to your original lender to ask them if your loan has been sold. Your loan cannot be deemed “delinquent” for 60 days while the transfer is occurring so you have time to check the facts and find out exactly what is going on with your account.