It just came to me that this Covid-19, Shelter in Place experience is a lot like a situation a few years ago. The Depression of 2008. A large mortgage bubble that popped and caused a faulty built economy to collapse. This created a huge mortgage meltdown people lost jobs, people that had jobs tied to the housing industry in any way lost their job.There is a lot that happened that I will not get into here. I learned a lot about banks, lenders, mortgage companies. 

I learned that in times of crisis the very large companies do not care. This does not mean the individual employees but the corporations. And as I was listening to the news I heard something interesting. Smaller banks and credit unions are working with people who are out of work or furloughed during this time. So if you are a buyer and looking for a mortgage lender you may want to consider a few things.

Maybe a local bank, or credit union. This way you have someone you can actually talk to. I almost wrote get face to face with...When you choose a bank for most likely the largest purchase of your life you may want to consider a smaller or more personal entity even if the rate is higher. 

Ask the lender you are working with will your loan be sold to a loan servicer? This is a service that takes care of the loan servicing such as mailing out mortgage statements, monitors that you are paying the loan, the taxes and insurance. They also direct services to foreclose on the home as well. Why is this important. Because this puts a layer between you and the bank you thought you were working with. Keep in mind even if they do not sell the loan to another bank or employ a loan servicer the investor that invested in your loan maybe far removed as well. So digging into a group that cares about your troubles that have come to you might be hard. This is where a smaller bank who keeps their loans in house or a credit union might be worth the higher mortgage interest rate. Because in the end if the lender can help you stay in your home until the economy recovers or if any other emergency should come up they maybe the better investment. 



Posted by Michele Replogle on


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