09 Feb 09 What happens to a person’s mortgage when the lending company goes bankrupt?
Tags: Bankruptcy Court, Mortgage Balance, Mortgage Bankruptcy, Mortgage Company, Mortgage Lending, Person Find
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Tags: Bankruptcy Court, Mortgage Balance, Mortgage Bankruptcy, Mortgage Company, Mortgage Lending, Person Find
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it usually gets sold to a different company.
What usually happens is that the mortgage is “sold” or “transferred” to another mortgage company, but I would check your mortgage documents to see what it says.
It’s sold to another lender. You’ll be notified in the mail where and to whom to send the payment.
the mortgage is give to another servicing company,nothing change for you other than a new address to mail the check.
Usually the mortgage gets sold to another lender…especially if it is a big company. A mortgage is an asset to the Bank so even if they don’t sell it themselves it will be liquidated by the courts. It is unlikely that you would actually pay the bankruptcy court yourself or have to find a new lender…as it isn’t your fault they went bankrupt in the 1st place.
Your mortage is considered to be the equivalent of an asset. Depending on the type of bankruptcy, either nothing will change, or they can sell your mortage to another lender and you will make your checks out to them instead. Check with your state’s laws, but there should be a time period that they give you between when they notify you and your checks need to go to the new company.
Lending companies usually sell mortgages soon after origination, so all they have left is the servicing rights. They get a fee for collecting payments and performing other administrative chores. If the company gets liquidated, the servicing rights can be sold off just like any other asset.
Some one will buy the paper.
Another mortgage company picks up the mortgage and really nothing changes except were you send the payment.