American Home Mortgage, Geneva Mortgage, Homebanc and many more have completely ceased all operations. This is leaving many homeowners worried about what is going to happen to them now that their lender is KAPUT!
Do not fret... don't worry at all... in fact, get ready to make your September payment as scheduled. Just keep your eyes open for your letter regarding who will be servicing your loan from now on.
You see, many of the lenders that you are paying your monthly payments to are in fact only servicing your loan. They are not holding the note, but instead they are collecting and distributing funds for the actual mortgagee - typically an institutional investor.
Sometimes an investor will change their servicing agent and gets someone else to do it for them. So be ready for your next month's payment. It will be due to someone even if your "lender" shut its doors.
For more details on what Loan Servicing entails, read Florida Mortgage | Loan Servicing ~ What Consumers Need to Know in this Market...
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David A. Podgursky, MBA
The Mortgage Go To Guy!!
Your Source for Residential, Commercial, Investment and Relocation Mortgages in Florida
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Right.
I emailed a few clients and told them to watch the mail.
They get so many mortgage solicitations I wanted to warn them not to toss a change notice away.
Mike - email them the link to my main blog... let them understand why the change and how it is just a lack of transparency in the industry...
thanks for reading!
David, those of us in the business some times take this information for granted. Good idea to start to make the public aware of this.
David, You really give some great advice for the consumer. I think this really should be a feature on localism.
David,
In regards to this post, I had tried to have a client call their Mortgage company and arrange to help them, because of their payment situation, they were told, hey we can't help we are not a bank and just passed them off.. I think this post is very helpful most people don't understand...
Thanks,
Tom Weiss
Great post! I'm flagging to be featured.
This happened to me this year with my car loan. At first, I didn't believe it was "for real" because the notice came from the "new company" and not only didn't it look official, but it didn't come with a coupon book and I'd never heard of this company before. Since I'm on an automatic withdrawal of my payments program, it simply asked for my account information...scary. I actually held onto it for a few weeks and waited for my "old company" to send me a notice that they were indeed selling off my loan...which never came. So I finally called my "old company" to confirm that they had transferred my loan.
So a note to the consumer would be to always try to contact your "old company" to confirm (if possible) before blindly sending payments or account information to any "new company".
I'm worried that with all of the media attention out there regarding lenders closing their doors, that someone will decide this would be a good way to scam the public. Send letters...get account information or a check made payable to them for a large amount of money...then disappear. Yikes.