Home » Personal Finance » Debt Management » A New Lender Took Over My Mortgage — Now What?
When you were going through the home-buying process, choosing a mortgage company was a big part of that. You likely did painstaking research on each company and carefully considered loan offers before deciding on one.
Despite all that hard work, your mortgage servicer — the company that collects your monthly payments — can change. And there's not much you can do about it. If you receive a notice that your mortgage has been sold to a new servicer, here's what you need to know about the transition.
To raise capital: Because mortgages are often repaid over the course of decades, loan servicers would be strapped for cash if they tried to manage every mortgage themselves. Instead, they bundle a group of them together and sell them to other servicers or investment companies to raise capital.
The company is closing: Some loan servicers close, or merge with other servicers. To complete the transition, they sell the current mortgages to other servicers.
They're switching their focus: When a company decides to focus on another area of business, such as commercial real estate, they'll sell off their existing portfolio.
If your loan servicer sells your mortgage, it's nothing personal against you. It doesn't say anything about you or the home you bought. It's simply a business decision.
Here's how to handle your mortgage being sold to a new servicer.
Many people don't pay enough attention to their mail. They'll skim through it and toss letters or notices from companies they don't recognize. However, that's a big mistake. If you have any type of debt, including mortgages or student loans, your loan servicer will typically communicate solely through the mail. If you're not careful, you could miss out on important notifications.
Get in the habit of opening every piece of mail that arrives to ensure you have the latest information on your mortgage and other financial accounts.
It's possible to miss a notice. You could accidentally toss a letter from your loan servicer, or it could even be lost in the mail.
If you see that your loan servicer changed, call the loan servicer and ask for more information, such as payment details and when the transition officially begins.
Loan transitions can be overwhelming, so keep receipts of all your payments. And if you speak to a representative from your loan servicer, keep notes on the date, time, and the name of the person you spoke with in case there are any problems.
Although your loan can be sold at any time without your consent, a sale doesn't change the terms of your loan. Your new company can't reduce your repayment term, for instance, or adjust your monthly payment. The only difference you'll notice is the name of the company you write on your checks.