When your mortgage is transferred to another lender?
Similarly, it is asked, why do mortgage loans get transferred?
There are basically two main reasons why a lender might sell your mortgage. The first has to do with capital. When a loan gets sold, the lender has basically sold servicing rights to the loan, which clears up credit lines and enables the lender to lend money to the other borrowers.
Likewise, how do I transfer my mortgage to another lender? When you transfer your mortgage to a new bank, you have to refinance your mortgage all over again. Banks don't simply take over a mortgage -- they make you reapply for a whole new loan. Refinancing your loan is nearly the same process as your first mortgage -- except that you already own the house.
One may also ask, what happens when your mortgage loan is transferred?
A transfer or sale of your mortgage loan should not affect you. “A lender cannot change the terms, balance or interest rate of the loan from those set forth in the documents you originally signed. The payment amount should not just change, either. And it should have no impact on your credit score,” says Whitman.
What does it mean to transfer servicing of a loan?
When your lender transfers servicing, they hand over the management of your loan to a new mortgage or servicing company. For the borrower, all this means is a new institution will be collecting your payments, handling your escrow accounts, dealing with any insurance or tax matters, and answering your questions.