Posted on: 26th Sep, 2009 09:13 pm
What happens in a situation when the lnder goes bankrupt?
As I understand they may sell the current loan to soem other lender, but what and howill the customer knwo about it
Any suggestions to people who are in this situation
I have seens few posts on this forum and they are really in a bad situation.
Some of them are in situation where the lender is not respondign at all, but they are collectign the payemnts
Some ideas woudl be helpful for all those posters on this forum
As I understand they may sell the current loan to soem other lender, but what and howill the customer knwo about it
Any suggestions to people who are in this situation
I have seens few posts on this forum and they are really in a bad situation.
Some of them are in situation where the lender is not respondign at all, but they are collectign the payemnts
Some ideas woudl be helpful for all those posters on this forum
Sunnyca you are right.
It is not a right practise. in fact such lenders are cheating as they are not informing to others & keep collecting monthly payments.
condition becomes worse when they have already sold mortgage to other lender.
It is not a right practise. in fact such lenders are cheating as they are not informing to others & keep collecting monthly payments.
condition becomes worse when they have already sold mortgage to other lender.
yes i agre with gregg i have experienced in this field he is rite so be carefull...
To the best of my knowledge, the only time that a borrower is required to be notified of any changes in their loan is per Section 6 of RESPA, I believe, when the *servicing rights* are sold/assigned/transferred. The note itself can be sold literally 1000 times and as long as the servicer stays the same the borrower never needs to be notified. That's part of why MERS is such a beautiful system for lenders and why it cheats county registries of deeds out of millions of dollars in much needed funds.
Likewise, if the lender is being put into receivership, as so many have been in the last year, the FDIC is not required to inform the borrower. I found that out personally when, in 2001, the FDIC closed Superior Bank.
The best thing that a homeowner an do if they think there is something going on is track their payments. Scan your checks into your computer every month before you mail them. Mail them return receipt requested. And coordinate the "cents" to the month that the payment was made i.e. if a monthly payment $1041.23 round it up to $1042.10 for an October payment, $1042.11 for November, $1042.12 for December etc. It makes it at least a LITTLE easier for you if/when you have to have your account audited.
Likewise, if the lender is being put into receivership, as so many have been in the last year, the FDIC is not required to inform the borrower. I found that out personally when, in 2001, the FDIC closed Superior Bank.
The best thing that a homeowner an do if they think there is something going on is track their payments. Scan your checks into your computer every month before you mail them. Mail them return receipt requested. And coordinate the "cents" to the month that the payment was made i.e. if a monthly payment $1041.23 round it up to $1042.10 for an October payment, $1042.11 for November, $1042.12 for December etc. It makes it at least a LITTLE easier for you if/when you have to have your account audited.
when someone sells a loan, they are really selling the right to collect payments. don't quote me on this, but I think as long as you can establish that you have made your payments correctly (record EVERY payment, date made, amount etc. keep receipts, electronic transaction records, cheque stubbs and so on).
you MIGHt be able to establish who the new holder of the loan is through a title or deed search, as the lenders interest will need to be noted against the property wouldn't it?
you MIGHt be able to establish who the new holder of the loan is through a title or deed search, as the lenders interest will need to be noted against the property wouldn't it?
You're not quite there Wretch.... A "loan" is actually a minimum of two separate commodities those being the note itself and the servicing rights to that note. As I pointed out previously, notes can be sold independently of the servicing rights i.e. as long as the servicing rights stay with Company X the note can be sold literally a million times without the borrower being notified. In fact, the ONLY time a borrower needs to be notified, per Section 6 of RESPA I believe, is when the SERVICING RIGHTS to their loan are sold/assigned./transferred.
And in theory you're correct in that a borrower SHOULD be able to discover who their note holder is at any given time by a simple title search at their county registry of deeds. The problem there is that apparently very few note holders or servicers bother to adhere to whatever state RSAs may be that govern the recordation of mortgage documents. In my own case, for example, it was more than two years before the Assignments of Mortgage purporting the supposed 2001 sale of my note from Superior Bank to Merrill Lynch entities. Those Assignments were, in fact, not recorded until December 2003 - five days before I was served with a Notice of Intent to Foreclose. In fact, as long as the note holders/servicers interest aren't questioned, the only time assignments need to be recorded is when the note holder/servicer is about to initiate foreclosure proceedings in order to attempt to preserve their legal standing.
And in theory you're correct in that a borrower SHOULD be able to discover who their note holder is at any given time by a simple title search at their county registry of deeds. The problem there is that apparently very few note holders or servicers bother to adhere to whatever state RSAs may be that govern the recordation of mortgage documents. In my own case, for example, it was more than two years before the Assignments of Mortgage purporting the supposed 2001 sale of my note from Superior Bank to Merrill Lynch entities. Those Assignments were, in fact, not recorded until December 2003 - five days before I was served with a Notice of Intent to Foreclose. In fact, as long as the note holders/servicers interest aren't questioned, the only time assignments need to be recorded is when the note holder/servicer is about to initiate foreclosure proceedings in order to attempt to preserve their legal standing.
I think it is difficult when alneders go bankrupt
Especially in this market, the new lender may nto want to listen
Especially in this market, the new lender may nto want to listen
Just be in market and be aware about your lender, So you can avoid further problems,