Why did my lender sell my Mortgage

Why did my lender sell my Mortgage?

The mortgage is a Legal Agreement used by an individual or a business firm by evaluating their property to be mortgaged for security interest until the loan is not paid off. This means if the loan is not upheld, bank or creditor can seize it through acquiring the borrower's property.

When you apply for a home loan, you will receive a corporate-required exposure mentioning that your lender has a right to sell your mortgage.

After a lender makes you a mortgage loan, it should be calibrated as long as possible. This includes congregating and processing of your payments, summarizing your balance to you, regulating your bond to pay your property taxes and insurance, reciprocating to your ongoing inquiries. It's prevalent business system for lenders to sell your mortgage to a new entity. Hence, selling the mortgage to companies like Freddie Mac aids in contributing more lucite into the market, capitulating lenders like yours to make more home loans.

(The Federal Home Loan Mortgage Corporation, also known as Freddie Mac is a public government-sponsored enterprise(GSE) based in Fairfax County, Virginia. It was forged in 1970 to elaborate the secondary market for the mortgage in the USA. Freddie Mac along with Federal National Mortgage Association also known as Fannie Mae, buys the mortgage on the secondary market and sells them to investors on the open market.)

Scoop about Servicing Disclosure Statement

  • The Servicing disclosure statement will apparently analyze whether the lender will keep your loan, so all recruitment including your monthly mortgage affirmation will always come from the original lender who made the loan.

  • Sell the loan to some erode point in the future, so your lender will originally do your recruitment including your monthly mortgage affirmation but will potentially sell in the future. 

  • Sell your loan before the payment is due, so all the recruitment including your monthly mortgage affirmation will come from the new entity.

Thus, the terms of your loan won’t change even if your lender does.

Our Rights amid mortgage sale

In case the lender who made your loan sells it promptly or later in the future, here's what the Federal Law under the Truth In Lending Act(TILA) desires to protect the mortgage: 

  • The lender should assert you in written about the selling of your mortgage at least 15 days before they officially sell it to another entity. They must divulge the time they'll stop taking the payments.

  • The new lenders should assert you in written that they are taking over your loan not more than 15 days after the transfer date. Be well aware of their name, address and customer service phone number. They must divulge the time they'll start taking your payments. 

  • If the critique is united, it should be delivered 15 days before the official transfer date.

(The Truth in Lending Act(TILA) is united states federal law instigated in 1968. TILA was designed to propagandize the appraised use of credits as it protects consumers from closing cost abuses by compelling the exposure of loan terms and fees calculated by the lenders.)