Your Mortgage Lender

Max Said:

What happens to your mortgage if your lender goes bankrupt?

We Answered:

Your mortgage is an "Asset" to your mortgage holder.

In event of a liquidation, the Assets are sold to another company.

You would probably have to make your payment to a different place but not much else would change.

Diana Said:

How do you know if your mortgage lender received bailout money?

We Answered:

HSBC has not received any direct funds from the United States Government. HSBC is not a United States owned bank. HSBC is not based in the USA.

Dwayne Said:

Can your mortgage lender check your credit report without your consent?

We Answered:

Your current mortgage lender can pull your credit to determine whether you can afford your existing mortgage. You did sign an application for that loan. Credit cards and banks do this every few months.

Dianne Said:

Can you work with your mortgage lender to have them willingly lower your principle balance?

We Answered:

HR3221 introduces a special FHA program which is based on reducing the principal balance it a maximum of 90% of the current appraised value.

I believe that the law goes in to has an effective date of 10/1/08 so the program may not be available, but if you may be upside down you might want to contact your servicer to see what they know about it.

Of course, lenders do not want to reduce the balance, but it could be preferable to a foreclosure. First, they prefer to do a rate reduction, then a term extension and the last resort would be a principal reduction.

You may also want to get in touch with http://www.hopenow.com if you are at risk of foreclosure.

Good luck.

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