first payment default

Guest

I am in the midst of a issue with my mortgage broker. My closing documents stated that I submit my payment to a lending institution and I was then advised to send the payment to a different institution that was connected to the mortgage broker.
I was advised that if I did not comply with their request that I would be in first payment default and foreclosure would begin immediately.
I sent the payment to the lending institution on my loan documents instead and they accepted my payment.
Also, that lending institution "sold" my mortgage to another lender and I just made my payment to them. If that payment is accepted by this new lender can I still be in "first payment default" and can this mortgage broker institution still foreclose on my property as I have another lender holding this loan?
Lkranda

colin · Posted: Wed Apr 18, 2007 5:54 pm Post subject:

Hi Lkranda,

Welcome to Mortgagefit forum.

Broker cannot dictate to you whom you will send the payments after loan closes. You did the right thing by sending the payment to the institution named on the loan document.

The payment you made to the new lender will surely be accepted, rest assured about that. Your loan documents must have been sent by now to the new lender and from now on he will be accepting the payments.

Did the previous lending institution give you the address of this new lender?

The mortgage broker cannot start foreclosure as he is no way connected to this loan. Only the lender who is servicing your loan has the right to receive the mortgage payments and in case of defaults to foreclose. I do not know how he is claiming that he can foreclose.

Colin

miller_st · Joined: 17 Jan 2007 Posts: 917 168.95 Dollars($)

Did you ask the broker why you will have to send your payments to a different institution which is not named on your loan document?

Is this other lending institutions in way connected with servicing of your loan? If they are not then they can do nothing like what they are claiming they can.

Miller

Guest

I think that broker is trying to fraud you as lenders at least allow a borrower to continue the mortgage payments when they have 2 to 3 defaults before starting foreclosure. And this broker is saying that if the first payment is not sent they will start the foreclosure process.

Jessica · Posted: Wed Apr 18, 2007 9:55 pm Post subject: RE: foreclosure concerns

Hi Lkranda,

Welcome to our community forums.

If your lending institution has already sold off your loan to another lender, you should be making your payments henceforth to the second lender. And, you have done it the right way. But I am skeptical about your broker. I mean how could he say that you should pay for the loan to an institution associated with the broker? The broker hasn't sold your loan to another institution. And, moreover it is not so easy to foreclose a loan. Lenders generally prefer avoiding foreclosure and suggest alternative options by which a borrower can come up with the payments.

Now, forget about the foreclosure; that's not going to happen actually. Perhaps your broker must have tried to extract more money from you. If you ask me frankly, I would say that once the loan is closed and you have paid the broker for his service to you, it is better that you deal with the lender directly as he will be concerned for your payments. And, if your loan has been sold, your payments should be accepted by the second lender who will be servicing your loan. Check what your loan document speaks about any change in the servicing. It is important that you go through the statements one again before asking your broker what he is up to by saying that you'll have a first payment default.

Hope this will help. If you have any more queries, feel free to share it with our community.

Regards,
Jessica

Guest

Are first payment defaults legal? I was late on my first payment and the lending institution has taken the car. Is this legal?

jveenstra · Posted: Thu Nov 19, 2009 3:29 pm Post subject: First Payment

lkranda, while you know what you are talking about, it can be lost to us a little bit in the translation.

When you refer to your mortgage broker, the term broker implies to us that the person you applied with and closed either closed in the name of the actual lender or table funded in their name but at the closing it was assigned to the actual lender. (I know, more mortgage terms that confuse you rahter than us)

You had instructions at closing where to mail your first payment. Then the loan was "sold" and you were instructed to send payment someplace else?
If you can be more specific, perhaps we can answer better.
To what lender/servicer were you told to mail the payment at closing--the name.
To what lender were you then told to mail the payment--the name of the lender and how were you notified to do that--in writing??
Normally, when someone makes a payment in good faith and the transfer of lenders/serving crosses about the same time, the client (you) are not supposed to be hit with a late payment if the payment was made any time in 60 days from the transfer.

If the closing occurred in the name of the broker's company at closing, they were not a mortgage broker, they were a mortgage banker (closed with their owen funds) and sold the loan shortly thereafter.

If they closed as a mortgage broker, the lender did not even have the loan documents from closing yet to process and it is unlikely they would sell the loan/servicing any faster than about 60 days after closing, which would be past the first payment due date.

The scenario you describve makes it sound like a mortgage banker closed in their own name and sold it fast after closing.

Any which way, you are supposed to be given at least 15 days notice as to where to send the payment and should not be counted late if the notices and payments crossed hands all around the same time no matter which of the two you sent the payment to.

All times are GMT - 7 Hours

Page 1 of 1