Not sold, just serviced...

[IOBA]

I talked to the LO today.   I asked if they sold the loans.  He said, "Nope.  But we do have them serviced."   Okay....

And the big four he named - ew!   GMAC, US Bank, Wells Fargo, and sometimes BA.  I have no say in who gets to "service" the loan.   Ok, guys, if I wanted to deal with those companies, I could have applied directly.

So, can anyone give me more information on this "servicing"?   Isn't it pretty much a sale of the loan?  I would have to make my payment to the "servicer"  and the "servicer" will report on the CR and the "servicer" is the main point of contact if there is an issue.   So again, what is the difference?  Is my lender acting more like a broker?

[cdtotten]

For your purposes as a consumer, the loan is being transferred. You will not deal with the original loan broker at all. If the loan is being serviced by another company but held by the original issuer, they do not have the capacity to accept monthly payments, track the loan, issue tax statements, etc. so they pay another company to service the loan for them. They assume the liability of the loan still though... if you default, the broker is in trouble, not the servicer.

No, you have no choice in the matter, and anytime you go through a broker rather than an actual bank, they almost always sell the loan off.

[IOBA]

This is with my bank.      The same one that has no problem reporting to the IRS if they paid me a penny in interest.    They also have my cc.  

He was clear, the loan is NOT being sold, just serviced.     Sounds to me like it's being sold.   Oh well, such is life.   *drumming my fingers*   

*** still  a member of the "wait for it..." club.

Thank you for your reply.     Sometimes it's lonely out here in this "wait for it..." club.   I think I am the only person in my branch!  

[doublespaces]

I have a similar situation, wondering when my mortgage company its going to transfer the loan to be serviced by someone else... My first payment goes to my original mortgage company. I just want it reported on my credit report asap.

[Booner72]

---

@doublespaces wrote:

I have a similar situation, wondering when my mortgage company its going to transfer the loan to be serviced by someone else... My first payment goes to my original mortgage company. I just want it reported on my credit report asap.

---

Hi doublespaces - why do you want your mortgage to post ASAP?

[IOBA]

Really?   Your FICO score will likely tank for a short time and your current creditors may get cold feet and reduce the CL or close cards.  The creditors said they cancelled or reduced CL lines BECAUSE I had a mortgage.  Seriously.  That happened to me when I got my very first mortgage.   The score rebounded after some time and extra principle payments.    The CL never came back.  I never asked for them to come back either.

My current lender says that the mortgage should report 45+ days after closing.   If I close at the beginning of November, it  would most likely post January 2012 making it over 45 days, closer to 60 days.   If I close at the middle of November, it should post by January 2012, making it closer to 45 days.   If I close the last day of November, it probably won't finish processing internally until December, pushing the post date to as early as January 2012, but most likely February 2012.

Why do you want it to post quickly?