So, Your Mortgage Has Been Sold!

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You received notification from a mortgage company telling you that you now need to send your monthly payments to them.


Protect yourself - or at least try to.   Unless you have received a letter from your current mortgage holder, do not send money to a company that is claiming they bought your mortgage.  The law gives you a 60 day grace period to send your payment to the new company, if it is a legitimate one.  If you sent your check to the old mortgage company and they had to reroute it, you cannot incur any penalties, including any late fees or black marks on your credit report.

In 1990 Congress moved to regulate the assignments or sale of mortgage loans.  Provisions were added to the Real Estate Settlement Procedures Act (RESPA) as part of the National Affordable Housing Act.

     1.  The lender must disclose their procedure on assigning or selling mortgages.

     2.   When a lender assigns, sells or transfers your loan - both lenders involved must make disclosures.  Name, address and phone number of the transferee including the effective date the transfer takes place.

     3.   It also must state that it does not affect the terms of the mortgage, only who is receiving it.  The basic terms of the note and deed of trust cannot be changed.

Selling a  mortgage has become more common.  In order to make more loans they depend on available cash to do business.  The quickest way to get more cash is to sell the loans they've already made.

For more information, write to the Mortgage Bankers Association of America and request their free booklet, "When Your Loan is Transferred to Another Lender," at 1125 Fifteenth St., NW, Washington, DC 20005.