We have our mortgage at Country Wide

[LEW]

I keep reading reports they may go bankrupt. Guess we'll be making our payments to someone else soon? I know they can't change our terms but what does happen, anyone know?

[Saturday]

1. Really? Mine is at Country Wide too.

Interested to hear the answer to you question.

[Justyce]

2. When our mortgage loan changed hands, we

just got a letter in the mail telling us the new company's contact info, etc., and then got a new coupon book from them -- didn't have to do anything other than change who/where we sent our payments.

[hobbit709]

3. Since we bought our house 16 years ago

it's been through 4 different mortgage companies. The terms of the original hold through.

[TechBear_Seattle]

9. Too bad the same can't be said of credit cards n/t

[blue cat]

4. my niece works for them

not going bankrupt, but other companies have. they have bought some mortgages and they are working with people to get their payments affordable.

[DemocratSinceBirth]

5. Nothing

You will just be paying somebody else...

[Marrah_G]

6. It will be sold to another lender as part of the bankruptcy

I work in a related field and the rumors are flying here also. In Mass another mtg writer just stopped all new loans today.

I think the economy is going to crash in a very serious way and we might find ourselves living a very different lifestyle.

[shain from kane]

7. We had about six mortgage companies assume our original mortgage. Of course, they look at your

application for job stability. But every couple of years, another company was assuming our mortgage, mostly all from out of town, Florida, Texas, etc. And, of course, the people that we originally negotiated with are long out of business.

[jojo54]

8. Mine too.

But my loan holder is still Quicken so no matter what happens, they still hold the pink slip. We just make our payments to Countrywide.

But everybody, beware! If Countrywide is your loan holder and they do go under, demand full disclosure from your future holder - there are a lot of loan companies (especially banks) that tack fees on to the back of the loan, and you have no idea until it's time to refi or sell.

[Hepburn]

10. In cases of bankruptcy...as I understand it....

...monies due to the bankrupt entity are paid to the BK ct...or to an entity which they designate.

[Bluebear]

11. Does one keep paying their Countrywide mortgage as usual now?

[DemocratSinceBirth]

12. Yes-Or Else You Are In Default And They Will Begin Foreclosure Proceedings In About Ninety Days

eom

[Bluebear]

14. So if someone buys your mortgage it kind of "freezes" at the exact point of debt

when it goes to the new concern? (Thanks for your insights....who knew this would even be a comprehensible problem with Countrywide a few years ago, eh?)

[DemocratSinceBirth]

15. Everything Remains Exactly The Same Except The Mortgagee Is Different

Maybe they will lose your loan in the process and you won't have to pay anything but that's remote...

[Bluebear]

16. Woo hoo! That could happen!

But not with my luck lol. Thanks!

[DemocratSinceBirth]

17. My Mortgage Company Forgot To Pay My Homeowners Insurance Out Of Their Escrow Funds

So anything is possible...


Living in Florida I was really pissed but I remedied it immediately...

[slackmaster]

27. I hate impound accounts - too many opportunities for error

Haven't used one myself in many years.

[shanti]

37. well, i like them myself

sure, i've had ONE screwup in my impound account over the past 11 years of home ownership, but it was during a re-fi and i fixed it. other than that, it sure takes the heat off remembering to pay taxes and insurance (and budgeting for them). it's all done for me and i love that.

[slackmaster]

38. California's Proposition 13 keeps property taxes under control

Insurance costs aren't too bad here either. I've found it easy to budget for both.

[DemocratSinceBirth]

41. Now I Call My Agent To Make Sure They Get Paid...

What made me apoplectic is in Florida the "big" insurance companies aren't writing new homeowners policies and I was contacted about three days before the insurance was about to expire although there is a grace period...

I paid the insurance out of my own pocket but got reimbursed...

[Bo]

13. C.W. is the worlds largest Home Lender

if they go under...Heaven help the USA

[Hepburn]

18. My thoughts exactly....

....and then what happens next. I keep seeing the proverbial pond with a pebble dropped in it and the ripples starting outward.

[Warpy]

19. Somebody will have to buy your mortgage

People who have been paying their mortgages on time long enough to establish their credit worthiness and whose houses are still worth more than the outstanding debt will probably be OK.

The worst case scenario is that you will have to refinance your home, renegotiating the terms, and not be able to.

[DemocratSinceBirth]

20. A Mortgage Company Can Not Change The Terms Of A Loan Unless There Has Been Fraud Or

A Default

[DemocratSinceBirth]

24. Ergo

The transfer of servicing should not affect you or your mortgage adversely. The original terms and conditions of your mortgage will stay the same. Your interest rate and duration of your loan will not change on fixed rate loans. Your payment should stay the same or on the same schedule except in cases where changes in taxes or insurance requirements increase or decrease the escrow amount.



http://www.santacruzmortgage.com/What%20Happens%20When%20Your%20Loan%20is%20Transferred.htm

[slackmaster]

28. Sometimes you end up with crappy service

That's really the worst thing that can happen to a borrower who keeps a loan current.

[Warpy]

36. No, but if a mortgage can't be sold, the mortgagee

must find other arrangements.

That is when the paper can and will be renegotiated.

This hasn't happened for a very long time. It might happen now, though.

Like I said, having to find another mortgage on one's own is a worst case scenario.

[DemocratSinceBirth]

40. Then In That Case The Mortgagor Won The Lottery

He just got a free mortgage...


As long as the mortgagor is not in default or committed fraud to get his mortgage the terms can not change. If the mortgagee can't sell the loan he's stuck with it...

If that wasn't the case a mortgagee could grant you a loan at 6% on Tuesday and sell it to someone who could charge you 19% on Wednesday...


Why would the mortgagee need to make other arrangements?

The homeseller was paid as soon as the loan closed...

[Warpy]

42. No, the mortgage holder won instant foreclosure

All that paper isn't going to just go away. It will be bought up by a bank here or abroad for ten cents on the dollar.

People will have the choice between going out the front door and leaving it all behind or scrambling for a new mortgage with new terms.

[slackmaster]

21. Me too - you have nothing to worry about - Let me tell you about my last refinance

I keep reading reports they may go bankrupt. Guess we'll be making our payments to someone else soon? I know they can't change our terms but what does happen, anyone know?

Even if they do file for bankruptcy protection, which I believe is unlikely, they would very likely continue more or less normal operations servicing good loans like yours. In the event your note gets sold, you will simply start making payments to and getting statements from someone else.

I decided to refinance in May 2003 when rates hit a very low point. My note, with Countrywide, had a rate of about 6.75 with about 25 years remaining on a 30-year term.

On the advice of several people I called Countrywide to see if they could offer me a better rate. What they did offer was not very attractive.

I went online to Lending Tree and got a few offers. The one that stood out was 4.75% fixed for 15 years, with minimal fees, from a company called Mortgage Select. I went for it.

Three months later Mortgage Select sold my loan.

To Countrywide.

:crazy:

[Allenberg]

22. I used to work for them.

Until I was fired for helping somebody on the internet. :eyes:

[slackmaster]

26. I've had contact with one of their systems administrators

My company does business with Countrywide.

Their IT policies are incredibly strict.

[PRETZEL]

23. As with most of the responses there won't be many changes at the loan level

your particular loan may be sold or it may not. Alot of what happens depends on the viability of the loan and the pool of mortgages held under a particular bond (assuming they are using FNMA bonds for funding).

Back when the big S&L debacle occurred I was escrow manager for my company's commercial portfolio. When we were taken over by the RTC that particular segment of the company was sold off right away. After that non-performing loans are generally sold at big discounts. That will more than likely happen here. Country Wide's remaining portfolio will consist of only performing loans and severe restrictions will be placed on their new loans. They'll stay in business but their loans will be only for pristine applicants.

[DemocratSinceBirth]

25. I Heard That Countrywide Tried To Get A Loan On Their 30 Day Commercial Paper And Were Asked 12 1/2

Percent...

WOW

[PRETZEL]

29. no way

I've heard their paper was one step above junk. Guess it's true.

[DemocratSinceBirth]

30. I Heard It On CNBC

Some of them are in full panic mode...

[slackmaster]

31. Moody's and S&P have been in the hot seat lately for their bond ratings

They're not always right, and now they may be overcompensating.

[DemocratSinceBirth]

32. This Is Too Depressing

I work at home with the tv on with the sound off...I'm switching to ESPN shortly...

[PRETZEL]

34. It's either that or this is the start of a big time

credit crunch. This may well be the dog coming back to bite them in the ass. I know many lenders putting money on the street just to get the name out there. Shoddy underwriting and too high loan/value and loan/debt ratios puts a big squeeze on a company's capitalization ratios.

I should know. I'm there right now.

[DemocratSinceBirth]

35. Call Me Naive But I Think We Will Muddle Through This Mess

Of course, a lot of folks will be hurt in the process...

And as Keynes said, "in the long run we will all be dead."

[PRETZEL]

39. That's the unfortunate part,

many people, especially the middle class is going to get really hurt by this. I have a feeling that unlike the market in the late 90's-early 2000's this re-adjustment is going to affect 2 of the major sectors of the economy.

Back then when the market was going extremely well it was mostly paper (i.e. stocks, bonds in the tech industries) that was creating the wealth that many people used to purchase real property at values that were unreasonbly high and with requirements that were based as much on pro-forma income as opposed to real income. It's the real property sector that's now coming due and adjusted for inflation and rising prices on virtually everything else cash flow crunches have left many (including myself) with negative cash flows. But I don't blame the market for my own stupidity.

The market will correct itself. It will take a few years and I seriously doubt that the high marks seen will be achieved again any time soon. I'd expect somewhere in the 11 - 12K range to become the norm again. What I hope will occur is that investments will no refocus from the higher yields of companies like Country Wide but will come back into the more conservative municipal bonds. That would be a huge bonus for many states and municipalities.

[DU GrovelBot]

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