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You don't make payments to the lender. You make payments to a payment servicer hired by the lender. Until midway through the Obama administration, nobody had
by blacksqr 8y ago
You don't make payments to the lender. You make payments to a payment servicer hired by the lender.
Until midway through the Obama administration, nobody had any obligation to notify you if your mortgage was bought or sold. Payment servicers had no obligation to tell you who they were forwarding your checks to. Your mortgage could be bought and sold multiple times, but as long as the same servicer was used, you'd never know (there were/are only a few big servicers). If the mortgage buyer used a different servicer, you'd get a letter from your current servicer about the new servicer you should send your checks to, but no info about who now owned your mortgage.
- user5994461 8y agoThank you very much for the explanation.
- tgb 8y agoI see how that could mean that the borrower might not know who owns the loan, but surely the payment servicer knows? Would they simply not tell you, even if you asked?
- blacksqr 8y agoExactly. The servicers existed to serve as a smoke screen for mortgage securitization shenanigans. The servicers sent the payments to trusts that had dubious possession of the mortgages. Trusts and banks passed ownership of mortgages amongst themselves, though tax law was supposed to prevent them from doing so. Ultimately the servicers had no more idea of who actually owned the mortgages than the homeowners.