April 20, 2008

Did Your Lender just Sell Your Mortgage

What You Need to Know

There is an important article by Bennie Kass for the Washington Post on Saturday regarding mortgage scams and the mortgage paper mess that followed the boom to bust of sub primes.

Many mortgages are made and then sold to another lender for a variety of reasons. What happened to one borrower when they took out a mortgage. Within a few weeks the borrower was receiving requests for payments from the original lender and the new owner of the mortgage - two monthly payment letters. Well...what do you do? You certainly want to pay only the rightful owner of the mortgage and you want to make a timely payment so that your credit remains in tact.

The Scam
Some disreputable types are getting the names and address of new owners and sending letters requesting payments now be sent to them as the new owners of the mortgage debt. A few payments later and they move on.

The rules of Assignment to a new Lender
1. In any Federally regulated lender, full disclosure of the lenders policy on assignment of a loan.
2. Both the original lender and the new owner of your mortgage must fully disclose names addresses and phone numbers so that you can check the validity of the transfer.
3. The disclosure statement will state that the terms of the original mortgage cannot be changed. Your original loan is all you are responsible for, dont let anyone tell you otherwise.
4. Grace period: The law requires a 60 day grace period during the transfer of a loan if your payment was sent to the wrong borrower. There cannot be a late charge nor a report to the credit agency regarding a late pay.
5. Complaints: You can send a letter of inquiry or a complaint and the original lender must respond within 20 days and correct problems within 60 business days from the date of the request.

Normally, both the original lender will send you a "goodbye" letter and the new lender will send letters to the effect of the transfer of your loan.

Thanks for Reading
Howard bell

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