![]() When the current servicer will stop accepting your payments. ![]() Review your servicing transfer notice carefully.“Usually, a borrower’s current servicer must notify them no less than 15 days before the effective date of the transfer,” says Baker. The other will come from your new servicer. One will come from your current servicer. If your loan is sold or transferred and the servicer changes, here’s what to expect and do: “Sometimes, a mortgage loan can be sold multiple times without the borrower’s knowledge if the servicer doesn’t change with the sale,” says Whitman. ![]() You will continue to make the same payments to the same source. Say your loan is sold but the servicer stays the same. But it should not increase your obligations,” she adds. If your loan gets a new servicer, “You may experience a different approach to loan servicing. And it should have no impact on your credit score,” says Whitman. The payment amount should not just change, either. “A lender cannot change the terms, balance or interest rate of the loan from those set forth in the documents you originally signed. The good news? A transfer or sale of your mortgage loan should not affect you. “It improves their liquidity.” What to expect as a borrower Selling your mortgage allows your lender to “receive an up-front cash payment instead of waiting for you to make payments,” Whitman says. It may sell some 30-year loans and buy 5-year loans to balance itself. “It also reduces their exposure to risk, including asset-liability mismatch.”Īn asset-liability mismatch occurs when, for example, the lender owns a lot of long-term debt (30-year mortgages), but retains short-term deposits (5-year CDs, for instance). This allows them to make additional loans to home buyers,” says Baker. “Lenders often sell their mortgages to replace the funds used to make the loan. They can also include insurance companies, mortgage REITs (real estate investment trusts), the commercial mortgage-backed securities (CMBS) market, or Wall Street brokerage firms.
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