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Case in point -- I mortgaged my home with a local bank then without me knowing or being asked I became a Wells Fargo customer. At least you can uninstall the ex

Case in point -- I mortgaged my home with a local bank then without me knowing or being asked I became a Wells Fargo customer. At least you can uninstall the extensions :)

JohnFen 3y ago
I strongly believe that selling ongoing loans to other companies should just be flat out illegal. You entered into a contract with your local bank, not Wells Fargo. It should not be legal any party in the contract to unilaterally rope the others into a contractual relationship with someone who was not involved.
- ceejayoz 3y ago
  I certainly don't remember all the terms of my mortgage, but surely there's a "we can resell your mortgage" provision in the terms that we bilaterally agreed to.
  - pixl97 3y ago
    If you don't have the ability to strike that clause is it really bilateral?
    - ceejayoz 3y ago
      You are under no obligation to sign. They are under no obligation to accept a modified contract. Both sides can walk away. Both sides will be bummed, but the bank is likely to care a lot less.
      - CatWChainsaw 3y ago
        These kind of libertarian explanations always conveniently neglect to mention any power imbalances between the parties. When called on it the response is usually just a less polite version of "oh well".
- jonas21 3y ago
  It's not unilateral. The contract you sign has a clause that gives them permission to sell the loan.
  - JohnFen 3y ago
    It is unilateral. That you agreed to give them the right to make such a unilateral change doesn't make it no longer unilateral. I think it's an unconscionable clause.
    - gnicholas 3y ago
      Why would it be unconscionable? I don’t understand why people would care if their loan is sold. My student loans have been sold a couple times and I didn’t mind. What’s the downside for the borrower?
      - toast0 3y ago
        Who owns the loan doesn't make a lot of difference, really, compared to who services the loan. But even still, you may not want to do business with some company for any number of reasons: maybe they treated you or someone you know poorly in the past; maybe you don't like how they do business; etc. The loan servicer is more important --- some of them are terrible at their job and tend to misapply payments etc, causing extra work for the borrower.
- NeoTar 3y ago
  How about if a company is taken over? Should I be “forced” to work for a company I did not decide to work for?
  - JohnFen 3y ago
    You can quit your job. You can't quit your mortgage.
    - hiatus 3y ago
      What would an alternative be in the case of a lender being sold? Force a balloon payment for the balance? It seems a better alternative to be able to transfer the loan like any other asset.
      - JohnFen 3y ago
        Well, that's an entirely different, and special, case that would require different rules, of course. That's not what causes loans to be transferred to others in the vast majority of cases.
    - cornel_io 3y ago
      You can, though, that's literally what refinancing is.
      - JohnFen 3y ago
        In many (but not all) cases, that's true enough, yes.
    - jodrellblank 3y ago
      Return the house keys to the mortgage holder and walk away. (This is about as convenient, pleasant, and useful advice as the "just quit your job" advice).
      - gnicholas 3y ago
paulryanrogers 3y ago
They can't change the terms of your mortgage though, can they? If not it doesn't matter much because things cannot get any worse for you.
- JohnFen 3y ago
  I think who you are doing business with matters a great deal even if the mortgage terms don't change. You're still being forced to do business with someone that perhaps you strongly object to doing business with. The company matters just as much as the product or service.
  - lotsofpulp 3y ago
    Who you are doing business with can change even if the legal company is the same. Suppose an executive retires, and a new one wants to make their mark, perhaps by cutting costs.
- gigel82 3y ago
  When my mortgage was sold to a big bank I started getting charged a fee for "prepayment" (basically I'd do another payment against the principal once a year or when I had extra cash, which was a non-issue before the sale). Refinanced with a local CU and stayed with them ever since.
  - lotsofpulp 3y ago
    Is this in the US? I would be very surprised if the prepayment (or any) terms are allowed to be changed. If in the US, I would be surprised to find out about prepayment penalties at all. https://money.usnews.com/loans/mortgages/articles/what-is-a-loan-prepayment-penalty https://money.usnews.com/loans/mortgages/articles/what-is-a-... > A lender cannot assess a prepayment penalty unless the penalty was included in the original terms of the loan. > According to the Federal Register, Dodd-Frank Act provisions “generally prohibit prepayment penalties except for certain fixed-rate qualified mortgages where the penalties satisfy certain restrictions and the creditor has offered the consumer an alternative loan without such penalties.” > For lenders that do charge these penalties, prepayment penalties cannot be imposed after the first three years of the loan term.
tric 3y ago
You can ask that the mortgage not be sold, and continue to be serviced at your local bank. I don't know if this increases costs, though.
jjav 3y ago
> At least you can uninstall the extensions Not a great example because the terms of the mortgage are fixed by the original contract, regardless of who they sell it to later. Whereas the extension (or any software) can radically change their terms (privacy policy, etc) in a single ugprade.

Case in point -- I mortgaged my home with a local bank then without me knowing or being asked I became a Wells Fargo customer. At least you can uninstall the extensions :)

JohnFen 3y ago

I strongly believe that selling ongoing loans to other companies should just be flat out illegal. You entered into a contract with your local bank, not Wells Fargo. It should not be legal any party in the contract to unilaterally rope the others into a contractual relationship with someone who was not involved.

ceejayoz 3y ago
I certainly don't remember all the terms of my mortgage, but surely there's a "we can resell your mortgage" provision in the terms that we bilaterally agreed to.
- pixl97 3y ago
  If you don't have the ability to strike that clause is it really bilateral?
  - ceejayoz 3y ago
    You are under no obligation to sign. They are under no obligation to accept a modified contract. Both sides can walk away. Both sides will be bummed, but the bank is likely to care a lot less.
    - CatWChainsaw 3y ago
      These kind of libertarian explanations always conveniently neglect to mention any power imbalances between the parties. When called on it the response is usually just a less polite version of "oh well".
jonas21 3y ago
It's not unilateral. The contract you sign has a clause that gives them permission to sell the loan.
- JohnFen 3y ago
  It is unilateral. That you agreed to give them the right to make such a unilateral change doesn't make it no longer unilateral. I think it's an unconscionable clause.
  - gnicholas 3y ago
    Why would it be unconscionable? I don’t understand why people would care if their loan is sold. My student loans have been sold a couple times and I didn’t mind. What’s the downside for the borrower?
    - toast0 3y ago
      Who owns the loan doesn't make a lot of difference, really, compared to who services the loan. But even still, you may not want to do business with some company for any number of reasons: maybe they treated you or someone you know poorly in the past; maybe you don't like how they do business; etc. The loan servicer is more important --- some of them are terrible at their job and tend to misapply payments etc, causing extra work for the borrower.
NeoTar 3y ago
How about if a company is taken over? Should I be “forced” to work for a company I did not decide to work for?
- JohnFen 3y ago
  You can quit your job. You can't quit your mortgage.
  - hiatus 3y ago
    What would an alternative be in the case of a lender being sold? Force a balloon payment for the balance? It seems a better alternative to be able to transfer the loan like any other asset.
    - JohnFen 3y ago
      Well, that's an entirely different, and special, case that would require different rules, of course. That's not what causes loans to be transferred to others in the vast majority of cases.
  - cornel_io 3y ago
    You can, though, that's literally what refinancing is.
    - JohnFen 3y ago
      In many (but not all) cases, that's true enough, yes.
  - jodrellblank 3y ago
    Return the house keys to the mortgage holder and walk away. (This is about as convenient, pleasant, and useful advice as the "just quit your job" advice).
    - gnicholas 3y ago

paulryanrogers 3y ago

They can't change the terms of your mortgage though, can they? If not it doesn't matter much because things cannot get any worse for you.

JohnFen 3y ago
I think who you are doing business with matters a great deal even if the mortgage terms don't change. You're still being forced to do business with someone that perhaps you strongly object to doing business with. The company matters just as much as the product or service.
- lotsofpulp 3y ago
  Who you are doing business with can change even if the legal company is the same. Suppose an executive retires, and a new one wants to make their mark, perhaps by cutting costs.
gigel82 3y ago
When my mortgage was sold to a big bank I started getting charged a fee for "prepayment" (basically I'd do another payment against the principal once a year or when I had extra cash, which was a non-issue before the sale). Refinanced with a local CU and stayed with them ever since.
- lotsofpulp 3y ago
  Is this in the US? I would be very surprised if the prepayment (or any) terms are allowed to be changed. If in the US, I would be surprised to find out about prepayment penalties at all. https://money.usnews.com/loans/mortgages/articles/what-is-a-loan-prepayment-penalty https://money.usnews.com/loans/mortgages/articles/what-is-a-... > A lender cannot assess a prepayment penalty unless the penalty was included in the original terms of the loan. > According to the Federal Register, Dodd-Frank Act provisions “generally prohibit prepayment penalties except for certain fixed-rate qualified mortgages where the penalties satisfy certain restrictions and the creditor has offered the consumer an alternative loan without such penalties.” > For lenders that do charge these penalties, prepayment penalties cannot be imposed after the first three years of the loan term.

tric 3y ago

You can ask that the mortgage not be sold, and continue to be serviced at your local bank. I don't know if this increases costs, though.

jjav 3y ago

> At least you can uninstall the extensions Not a great example because the terms of the mortgage are fixed by the original contract, regardless of who they sell it to later. Whereas the extension (or any software) can radically change their terms (privacy policy, etc) in a single ugprade.