If you are gearing up to buy a home, it is only natural to spend your time checking rates, mortgages, closing costs, and identifying how much all these things will cost you. But, what if after all your efforts, you found out that your mortgage is sold?
Why are Mortgages Sold, Anyway?
To banks, your mortgage is nothing but a financial asset. Their decision for selling your mortgage doesn’t have anything to do with you. Most of the time, lenders sell mortgages to free up their capital for any future lending.
How to Deal with a New Lender
If your lender tells you that your mortgage is sold, the law requires you to be notified within 16 days of the sake. You will receive a total of two letters, one from your new lender, and one from your previous lender. The letters will offer you all details you need to communicate with your new lender, which include how and where to make your payments. Make sure you send all your future payments to your new lender’s provided address. A new lender doesn’t have the right of changing your mortgage’s terms so your payment amount must not change.
The Grace Period
In case you mistakenly sent a payment to your previous lender, you don’t have to worry about penalties for a certain amount of time after the transfer of mortgage. After the mortgage is sold, you get a 60 day grace period in which your new lender will not charge you late fee on your payment when you made a mistake of sending the payment to your old lender. The grace period good for two months will protect you in the event of delay or miscommunication in the notification.
Should you pay late because of the mistake of sending your payment to the previous lender, your new lender will not report this to credit agencies. There is no way for your loan to be considered delinquent during the grace period.
Check for Error
It may seem like errors can take place when you transfer your mortgage to a brand new company. Although this doesn’t happen all the time, for your safety, check the mortgage statement from the new lender then compare this to the old one. In case there is a discrepancy or something seems different, dispute it to the new lender through a complaint letter. There is an available qualified written request that can serve as a model for your letter. Based on the law, your lender should send their response to you in a matter of 20 business days, and if there is a problem that requires resolution, they must act in a matter of 60 days.
In the event that your new lender doesn’t respond, get in touch with your past loan servicer to report the problem. If you still don’t get anywhere, file a complaint with Consumer Financial Protection Bureau. Companies must respond in 15 days to you and the CFPB.
