You may have heard the term “loan servicing” in the news recently. It is becoming commonplace for Mortgage companies and banks to sell mortgages a few months after borrowers close on their loan, sometimes even before a first payment is made.
What does this mean to you, the borrower? This means that your loan is now owned by another financial institution, however you terms and payments do not change. Unfortunately, in most instances, all contact with your original lender is cut off and the servicing of your loan is now done at this completely new and unfamiliar financial institution. Loan servicing is the process by which a financial institution collects interest, principle and escrow payments from you. It is also who you contact if you have any questions on your loans and where your loan payments are sent each month.
At Direct Federal, We keep all of our servicing in-house, meaning we will be your only point of contact for the terms of your mortgage. You will make all payments to us, your yearly escrow analysis will be done by us and if you have any questions at all about your mortgage, you can call us, right here, locally in Needham, MA. Call us and you will be greeted by a live person, every single time. You can even stop in the branch at any time and we’ll be happy to help.
Before you take out a mortgage or any other loan for that matter, make sure you talk to the financial institution about who services their loans.