{"id":12532,"date":"2010-03-28T11:17:35","date_gmt":"2010-03-28T17:17:35","guid":{"rendered":"http:\/\/template.lenderama.com\/?p=639"},"modified":"2010-03-28T11:17:35","modified_gmt":"2010-03-28T17:17:35","slug":"do-i-have-to-continue-making-my-mortgage-payment-if-my-lender-goes-bankrupt","status":"publish","type":"post","link":"https:\/\/dev203k.orbitwebx.com\/dev203k\/do-i-have-to-continue-making-my-mortgage-payment-if-my-lender-goes-bankrupt\/","title":{"rendered":"Do I Have To Continue Making My Mortgage Payment If My Lender Goes Bankrupt?"},"content":{"rendered":"

\"\"<\/a>When mortgage banks go out of business and are essentially taken over by the FDIC<\/a>, homeowners are left wondering if they still need to make a mortgage payment.<\/p>\n

Great thought, and a very common questions for many borrowers in 2009 and 2010.<\/p>\n

The short answer is YES, you still have to continue making mortgage payments <\/a>if your current lender files for bankruptcy or disappears over the weekend.<\/strong><\/p><\/blockquote>\n

In order to give a more thorough answer to this popular topic, we’ll need to address the relationship between mortgage loans as liens and mortgage servicers who make money by handling payments.<\/p>\n

To put this topic in perspective, 381 banks actually filed bankruptcy between 2006 and 2010 forcing them to cease their mortgage lending activities.<\/p>\n

A common misconception borrowers have about their mortgage company is that there agreement should become obsolete once the lender files for bankruptcy or goes out of business.<\/p>\n

Based on the way mortgage money is made<\/a>, packaged and sold on the secondary market as a mortgage backed security<\/a>, the promissory note (agreement) is actually spread between many investors who rely on a servicing company to collect and manage the monthly payments.<\/p>\n

A mortgage is considered a secured asset<\/a>, where the collateral is real estate.\u00a0 And, the mortgage note has a separate value to investors and servicers based on the interest and servicing fees they have wrapped up in the monthly payments.<\/p><\/blockquote>\n

This is why many mortgage notes get sold to other servicers who pay for the rights to service your loan.<\/p>\n

So basically, even if a mortgage company is bankrupt, someone else is willing to take on the job of collecting payments.<\/p>\n

Also, by signing a mortgage note, the borrower is committing to continue making the requires payments, regardless of what happens to the mortgage company servicing your loan.<\/p>\n

\"\"Bullets:<\/strong><\/p>\n