Is it best to go with a bank who holds the loan, or a loan company that can give you a better rate but then sells that loan and can sell it many times over the course. I worry about knowing who to pay each month and if they got it or not. Do these companies other than banks have like online payment things set up or do you still have to mail a check like the olden days?

4/7/2008 4:19:07 PM

A contract is a contract. Even if it gets passed off to someone else, both parties have to honor the terms. I think just about everyone does electronic payment these days. I see no reason not to go with whomever will give you the best rates with the least amount of bullshit fees.

4/7/2008 4:21:17 PM

thats what i was thinking too, i just wanted to see if anyone had any experience

4/7/2008 4:30:53 PM

haven't had this happen with a mortgage, but my current car loan is on it's 4th different "owner"

each time i've had to create a new account with a new site, which is a minor annoyance, but no other issues other than that. Also, this rate was quite a bit less than anything else i found at the time, so it's still worth the minor hassle.

4/7/2008 4:42:01 PM

when buying my first house, I heard from local banks that "you'll want to go with a local bank because you can go to them directly with problems and you know where your money is going each month!!"

that's bullshit, for many reasons
1) i did go with a local bank on that suggestion, and 1 month later it was sold to CitiMortgage anyway
2) "go to them directly"? who needs to go to a bank for anything? You can do everything online or over the phone - no need to ever actually set foot in a bank except maybe to sign the initial papers
3) i've owned two houses now over 4.5 years. how many times have I had a problem with my mortgage or payment that I needed to talk to somebody about? Zero. Furthermore, what could possibly go wrong that can't be taken care of over the phone anyway

like darkone said, a contract is a contract. You sign the paper to get the rate you want, and as long as you pay each month, who cares where that money is actually going.
Everyone has online payment now, and most of them would prefer you signup for automatic draft anyway so they get guaranteed payment every month, so there's no need at all to worry about if Bank X or Bank Y will get your money.

and i seriously doubt that there are any local banks that actually hold loans anyway. Even if you continue to pay the bank, they're surely just forwarding that money on to someone else anyway.

4/7/2008 5:04:26 PM

i dont know if all mortgages are like this but im guessing there must be some consistency...
my mortgage terms state that if/when my mortgage is sold, i will get 30 days notice and all that shit but also, if i accidently send my payment to the old lender, i have a 30 day leeway period to work it out, as long as the money was sent.

i do everything electronically so i'm not worried about it. but before you get a mortgage, ask if they sell them off or not. some do some don't.

4/7/2008 5:11:27 PM

thanks yall, i appreciate the input

4/7/2008 5:18:36 PM

if you sign the papers, the terms are the terms according to the documents regardless of who you pay.

i went with Capital Mortgage Comapny 2 years ago b/c they had the absolute best rate, better than all the local and non-local banks, and definitely better than websites like lending tree.

about 5 months into it, capital mortgage sold it to Washington Mutual. my rate is the same, customer service is better, and now i have a web access to manage my account (& automatic draft) where before i just sent a check off to raleigh somewhere.

i have no complaints and i'm actually really happy it was sold. wamu has been great and their customer service staff is excellent.

[Edited on April 7, 2008 at 5:21 PM. Reason : s]

4/7/2008 5:21:24 PM

if you want a portfolio lender with the best rates, good customer service, and good online access let me know

4/7/2008 6:03:43 PM

Almost everyone sells upstream to the big guys, it doesn't really matter who you initially get the mortgage from. Just go for the best rate.

4/7/2008 8:25:04 PM

^^very true - usually the best rates come from smaller brokers with larger volumes - they know how to work the account executives and underwriters and get shit through and approved.

4/9/2008 12:48:20 AM

Quote :

"loan company that can give you a better rate"

4/9/2008 10:07:35 AM

You get a 60 day grace period each time your mortgage is sold regarding any late payments being reported on credit. Even if you do accidentally send to the wrong company you have ample opportunity to correct it.

They will also send you a letter way in advance of your loan servicing being transferred. All the major loan servicers have online account management. Who initiates and who will service the loan should really not be a consideration on this. You get no peace of mind from it anyway..even if you get a loan at a bank that plans to keep your loan they could end up in a merger.

4/9/2008 12:11:34 PM

The SECU rarely every sells mortgages and their rates are as good as anyones, with much lower fees. No PMI with them either.

4.25%, no PMI, only 10% down is unbeatable. It's an ARM, but it can only change 1% every 2 years.

4/9/2008 3:59:11 PM

^I'm refinancing w/ that

4/9/2008 4:01:33 PM

Quote :

"their rates are as good as anyones"

Not always, and certainly not for 30 year fixed.

4/9/2008 4:02:39 PM

Quote :

"Not always, and certainly not for 30 year fixed."

agreed.

always shop around. secu usually has very good rates but it is not always the case and was not the case in my situation either.

4/9/2008 4:07:45 PM

Well they don't float daily like most banks, so some days others may have better rates, but if you account for no PMI (or no 2nd mortgage) and lower fees, it still works out better normally.

30 yr. fixed mortgages are only good if you know you'll still own the place in 10 years anyway.

4/9/2008 9:00:20 PM

Are you kidding me? Stop making blanket statements. First off, if you put 20% down you don't have to worry about pmi or a 2nd mortgage. Furthermore, there was a time when the arm rates were very close to the 30 year fixed. During these times 30 yr fixed mortgages were very good even if you hadn't planned on staying somewhere for 30+ years.

[Edited on April 9, 2008 at 10:17 PM. Reason : ]

4/9/2008 10:16:52 PM

Quote :

"30 yr. fixed mortgages are only good if you know you'll still own the place in 10 years anyway."

not true - i wish i had time to list the reasons
please

Quote :

"Stop making blanket statements."

4/14/2008 11:47:16 AM

The 30 yr fixed vs. ARM vs. Interest Only, etc. debate is much more complicated than TWW deserves. If you don't have a trusted financial adviser, my advice is: find one.

The financing of your home should be thought of as part of your overall financial plan, and that means 5, 10, 20 years out. You'd be amazed at how the numbers flesh out if you go with a lower interest rate loan, and instead of attempting to "pay off the house" how quickly that same amount of money with compounding interest will get you further, faster.

To put it another way, on the average home loan if you take the money saved by going with an interest only loan, put it in a tax-free bond fund or something similar that's averaging 5-8% you'll find that you'll have amassed the money to pay off the home in its entirety in much quicker than 30 years... and in the meantime all that money is much more liquid than if it you'd put it into paying off the mortgage.

It's like anything else finance-wise, you have to compare the risk that you're willing to take on your money, and the rate of return that you want. (And in the case of the aforementioned strategy, your willpower and financial self-control is obviously extremely important)

4/14/2008 11:57:34 AM

Quote :

"tax-free bond fund or something similar that's averaging 5-8%"

Where the hell can you get tax free bonds averaging 5-8%???

4/14/2008 1:22:13 PM

I would like to have this info as well.

4/14/2008 1:27:33 PM

Quote :

"Where the hell can you get tax free bonds averaging 5-8%???"

Today? No clue! I know I had several options a couple years ago that were above 5%, but I certainly wouldn't mind asking my guy how his previous suggestions are looking today.

4/14/2008 1:36:07 PM

Hey Bobby. I got some CDs at 15% in 1981 you should really look into purchasing.

4/14/2008 1:48:56 PM

I went to NCSECU for my loans and they havent been sold, kinda make sme happy, i really like their service.

4/14/2008 2:26:08 PM

Here are a couple examples from my guy... They're all based on triple A rated bonds, and have minimum deposits of 5k (which in the context of this discussion is what you do with down payment money instead of putting it down) They're all above par pricing, compared to other funds, but one would expect that for that rate of return.

8 was a little overzealous though, it's more like a 5-6% range.

4/14/2008 2:43:30 PM