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If I get my mortgage from a regular bank, am I chancing that they will sell it to a mortgage firm?

so then should I stick with an actual mortgage company?
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March 21 2011 - Oxford
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Profile picture for Clearpoint

But I will admit that there are Lenders and servicers I will stay away from because of the way they have treated individuals during this crisis.  Their lack of effort and ability would make it difficult to do business with them, but unfortunately any note can be sold so you might still wind up with them in the end.

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March 21 2011
Profile picture for Clearpoint
You would still be selecting based on today's current environment.  No one knew or heard of a thing called HARP, so one could not have selected a lender or servicer that would particiapte any more than you can select a lender today that may or may not have a unknown program in the future. 

If you select Bank or Lender X becasue they are participating in HARP loans, they may also have kept loans on their own books rather than sell them to Fannie or Feddie which means they also are servicing loans not eligible for HARP.  No one can control what will happen in the future, there may be no Fannie or Freddie Mac, no 30 year fixed or evengovernment loans backed loans in the future.  You need to base your needs on what exists today.
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March 21 2011

Larry -

Don't get me wrong, I'm not saying it should be any kind of signifcant factor in a decision.  It just isn't a Zero factor anymore.

For example some very large banks are limiting what they offer in HARP which is shameful, while other banks offer the full product line.   It is conceivable that all other things being equal, servicing could play a very small role in selecting a source for refinance.

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March 21 2011
Profile picture for Clearpoint
Justin it's too hard to speculate what lenders or servicers will do in the future, just becasue a particular lender today handles HARP loans doesn't mean they will participate in something in the future.  What the borrower needs to be concerned about is their terms currently not some hypothetical future need.
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March 21 2011
I used to have the same attitude like most responses already, which is that it doesn't matter who services the loan, the contract is fixed, etc.

In this past 12 months, working on HARP loans, I have seen a great many borrowers who could not benefit strictly because their servicer didn't offer the program due to loan having MI, or loan over 105% LTV.   It made me realize the servicer can become a very important aspect of a loan after it has been completed.
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March 21 2011
Profile picture for Clearpoint
Im confused by the question, why would it matter?  You are borrowing money to purchase a home and should focus on that, the terms and conditions of your loan will remain the same regardless who services or owns it after you close.
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March 21 2011
Once your mortgage has been originated any lender can sell your mortgage.  If this occurs you will be informed and may have to change where you send your payment.  Other than that there would be no negative outcome with having your mortgage sold.
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March 21 2011
No it's actually the opposite. Most lenders sell their loans to investors i.e. banks. Banks on the other hand fund their loans then service them. But be careful, each bank has their own tricky little set of rules and guidelines, so it generally better for the majority of consumers to go a lender, who can direct where that is loan is sold so as to avoid a possible denial. The Loan Officer should know where the land mines are (which each investor has) therefore steering clear of possible issues in the underwriting stage.

Good Luck!
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March 21 2011
It depends on the bank... Some banks will sell their loans and some will keep them in their portfolios and service them. You will sign a disclosure that will tell you what percentage of their loans get sold. Even if it does get sold, your terms wont change... Just where you send your payments.
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March 21 2011
 
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  • Asked by abc1156
  • In Mortgage
  • March 21 2011
Mortgage Rates
 
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