My mortgage lender is having subprime worries. Should I be worried?
by Mortgage Rates on Tuesday, November 2nd, 2010 | 5 Comments
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Don’t worry about. The worst time that may happen is they sell your loan to someone else. Which happens all the time with mortgage companies. The buy has to honor your contract.
You have nothing to worry about.
Even if Countrywide were to close down, your loan would be sold to another servicing company and you will continue making the same payments.
They cannot change the terms of your closed loan.
Your worries about your mortgage should be the following. Is your current payment actually paying off your loan or is the loan amortizing negatively? Are your current payments going to change dramatically in the near future making it so you can’t pay them? Can you afford your current payments? Other than that you should be fine.
The problem is that these banks offering subprime mortgages are getting killed because of all the foreclosures.
And they deserve it!
These people sucked in consumers with promises of great loans…..just get the loan at this great rate (for two years) then refinance! What could be easier.
These are balloon mortgages, folks. After that two years the monthly rate takes a huge jump, and if the consumer can’t get refinanced they have no prayer of paying the loan…..and end up having their homes foreclosed and/or filing bankruptcy.
I know several people who had this very thing happen…all because they believed the hype and promises of the mortgage company. In one case, after they tacked on the cost of the loan and fees, the mortgage was more then the home was even worth! It was impossible to refinance it!
Personally, I hope those leaches rot in their profits. And from what I’ve read in the news, they just might. But they may take the banking industry down with them.
There is no reason to be concerned. As long as you honor the terms of your mortgage contract, the worst that can happen to you is that Countrywide sells your loan to someone else (and this happens all the time anyway).
Your mortgage contract is fixed in stone, and cannot be changed or called back upon you unless you fail to honor the terms of the agreement.