Yay! You just bought a home! Once you are through unpacking (mostly) and some of the dust settles, many new homeowners get a letter from their mortgage company. This letter explains that the mortgage company has sold their loan to someone else. And oh, by the way, the owners (you) have to start sending the payments to the new company at a new address. And oh, also by the way, the owners might have to re-set up auto pay with the new company even though they just finished setting it up with the first one.
What the &#%@? In what world does THAT make sense?
While it might seem like a pain when/if you have to deal with that process, it’s important to understand that this “Secondary Mortgage Market” is part of the reason you were able to get a mortgage in the first place. Your mortgage broker can probably entertain you for hours with all the details, but basically it boils down to the fact that lenders are able to give loans to more people (and at more competitive rates) if they can turn around and offload those loans to another entity after closing. Freddie Mac & Fannie Mae buy the majority of these loans before packaging them together to sell to investors.
Anywho… What this means to you is that it’s pretty important to pay attention to all the junk-mail-looking envelopes that you get after buying a house. It’s somewhat of a boring version of duck, duck, goose where most of the mail that mentions your mortgage is trying to get you to refinance, and the select few interspersed every once in a while are telling you that your loan was sold and you need to mail your checks somewhere new.
Of course, feel free to give me a call if you ever need help figuring out if a piece of mail is something you need to care about.
Kadilak Realty Group @
Keller Williams Boston Northwest
How can we help? Feel free to contact us through the form below!