 Bill
Joined: 21 Mar 2006
Posts: 83
Location: Illinois
3.65 Dollars($)
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 Posted: Thu May 18, 2006 11:11 am Post subject: |
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Your past mortgage payment history and your 'history' as a customer are actually two different issues … especially when it comes to acquiring a new mortgage.
Mortgage payment history assists you in acquiring future mortgage financing from any future mortgage lender – regardless of which company actually collected the payments. This is due to the fact that mortgage payments are reported to the credit bureaus, helping to determine your future credit worthiness in the form of credit scores.
Past 'history' as a customer to any single mortgage servicing company (ie: Washington Mutual, ABN AMRO, Wells Fargo, GMAC, CitiMortgage, etc., etc...) unfortunately results in no advantage when it comes to new mortgage financing.
Mortgage company's that both service and originate mortgage loans have two completely separate operating divisions.
Mortgage Servicing Divisions: Mortgage loans are commodities just like stocks and bonds. The servicing-side of these companies purchase large amounts of loans from originating mortgage companies across the country. These companies earn income from both the purchase and sale of mortgage loans. They also earn income from individual loan servicing which involves collecting mortgage payments, administrating property tax escrow accounts, etc.
Mortgage Originating Divisions: These same companies may or may not have an origination business that creates new mortgage loans. When a consumer contacts the mortgage servicing company seeking any type of new mortgage (ie: purchase, refinance, second mortgage, equity line of credit, etc.) the inquiry is forwarded to one of the company's affiliate regional or national origination call centers. The borrower's loan process starts from scratch with absolutely no benefit to the consumer for being a current or past customer.
In fact, these same mortgage companies many times don't offer the most comprehensive or competitive mortgage loan programs to their own customers – due in part to the fact that they consider such a consumer as a captive lead that may not shop for a better deal. After all, as consciences consumers we all want to believe that our 'history' with any bank will be rewarded in the future. These lenders take full advantage of this emotion and common misconception. It's a very proven and profitable way of doing business!
Mortgage brokerages that only originate mortgages pride themselves on keeping the big servicing banks as honest as possible by educating consumers as to where they can actually get the best deal … ensuring the best possible financing for your specific borrowing situation – regardless of which bank ends-up servicing the payments.
I suggest you have a local/reputable mortgage broker shop on your behalf to ensure your payment history reaps the most benefits.
Best of Luck!
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Bill Clanton is a Mortgage Specialist and Manager of State Street Mortgage of Illinois. StateStreetMortgage.Net |
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Samantha
Community Mentor
Joined: 16 Sep 2005
Posts: 1539
Location: MASSACHUSETTS
137.28 Dollars($)
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| Posted: Thu May 18, 2006 12:16 pm Post subject: |
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Hi,
Welcome to MortgageFit Forums.
Bill is perfect in answering your query. Your mortgage payment history does count on your approval for a new loan.
As far as payment history with a particular company is concerned, it is not going to have any impact on a new loan. When you approach for a new loan again all the criteria are checked in the same way as in case of your first mortgage loan.
Your payment history helps indirectly as, if you are good at your payment that is reflected in your credit history. This helps the time you approach for a new loan.
But at one point may be I will disagree a little with Bill. Your record with a particular company sometimes helps, though not always, in getting a new loan with that company.
Sometimes it helps in negotiating with that lender but the minimum required conditions must fulfill in that case as you can understand that lenders are in the market to do business and no one will like to take a big risk.
Feel free to ask for more doubts.
God bless you.
For MortgageFit,
Samantha
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