Gray house with lights on

You’ve just received a letter informing you that your home loan has been purchased by an investor. Maybe you’re upset or confused. You carefully picked the mortgage lender you wanted to work with – does this change or jeopardize that?

We have good news: You don’t have to worry. This is a totally normal part of the mortgage process. Quicken Loans® still services your mortgage, and you’ll still get that great customer service you had before you closed.

So, what is an investor and what does it mean for your mortgage?

Lender vs. Servicer vs. Investor

You may have recently received a letter stating that your loan has been purchased by an investor. Usually, your investor will be one of the three government-owned or government-sponsored corporations that deal in mortgages: Fannie Mae, Freddie Mac and Ginnie Mae. Occasionally, a smaller, non-governmental investor will be the one to purchase your mortgage.

Before we get into the “why” of mortgage investors, it may be helpful to first go over a few different terms:

  • A lender is the entity that lent you the money to purchase your home.
  • A servicer is the entity that handles your mortgage after you’ve closed on your home. They’re the people you send your monthly payments to.
  • An investor is the entity that purchases mortgages from lenders. Investors include Fannie Mae and Freddie Mac, both of which purchase conventional loans, and Ginnie Mae, which purchases FHA and VA loans.

Sometimes lenders will retain the servicing rights on mortgages they originated, while the mortgage itself is purchased by an investor. This means that you’ll still work with and make payments to the same company you got your loan with, but that company doesn’t technically own the mortgage anymore. The servicer collects your payments and passes them along to the investor.

Try not to confuse the above terms with a bank, which is often used as a general term and doesn’t really tell us anything about the entity’s role in your mortgage.

Why Do Mortgages Get Sold?

It’s all about liquidity. Banks and lenders need to have enough money to continue to offer mortgages to home buyers.

Think about the typical 30-year loan term. If a mortgage lender has its money tied up in that transaction for the full 30 years, it will have less money to offer future mortgages. By allowing the mortgage to be purchased by an investor, the lender now has the capital and money flow to continue to lend to other borrowers.

On a larger scale, this process is a part of how the mortgage market works. Investors keep the market liquid so lenders can continue to help borrowers purchase homes.

What Does This Mean for Me?

You’ll continue to work with Quicken Loans® and have access to our customer service. We pride ourselves on being there for our clients and we’ll continue to be there for you, even after your mortgage has been assigned an investor.

Beyond that? It doesn’t mean much for you. You’re required to be notified of who owns your loan, hence the letter. But it doesn’t really affect you. The terms of your loan won’t change, and you’ll continue to make payments to Quicken Loans®.

Sometimes, in addition to selling the loan, a lender will also sell servicing rights on the loan, and the borrower will make their payments to a different entity. However, that’s not what’s happening in your case.

Quicken Loans® is proud to service 99% of the loans it originates. That means we’ll be there for you not just during the 30 days it takes for you to get the loan, but for the duration of your mortgage needs. No matter where life takes you – whether that’s a new home or a new insurance provider – we’ve got your back.

If you have any more questions, please let us know in the comments below!

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This Post Has 69 Comments

  1. We too were told that the loan would never be sold that it would be held by quicken until paid off. I specifically asked the question early on in the process. Not that it would of made a great deal of difference to me at the time. I know how the loan business typically works. The process was as smooth as can be!! Buttttttttt I do not like being lied to! still haven’t made the first payment so nothing has changed.

    1. Hi Tony:

      I’m sorry you had this experience and I’m going to get this to our client relations team to review communication in this matter. While we should have been clear about the process, I want to make sure you know that nothing will change when it comes time to make your payment. Except in a few special cases, you still make the payment to us and we take care of your escrow account. Nothing should change from your perspective and we look forward to being your lender for life. Thank you for reaching out today!

  2. QUICKEN LOANS INC. LIED TO ME, I WENT WITH THEM BECAUSE I WAS TOLD THEY WOULD NOT SELL MY LOAN . I WAS TOLD THEY DO NOT SELL THEIR MORTGAGES IT WOULD BE WITH THEM FOR THE LIFE OF THE LOAN . I HAVE NOT EVEN MADE MY FIRST PAYMENT YET. DOES ANYBODY TELL THE TRUTH ANY MORE.

    1. Hi Gary:

      I’m sorry you had this experience. As the vast majority of major mortgage companies do, we sell our mortgages shortly after closing. The difference between Quicken Loans and many other mortgage originators is that we don’t sell rights to the servicing on our loans. This means that we will be your lender for the life of the loan because we collect your payment and handle disbursements out of your escrow account if you have one. If you ever have trouble making your payment, you call us. I’m going to get this to our Client Relations team to look into what you were told and how we can better communicate what’s going to happen after your loan closes. Thanks for reaching out!

  3. Quicken loans was right on from the start both lender home purchaser knew were we were going with after the first insight conversation .. Pretty much smooth sailing after that !!!

    1. It’s wonderful to hear that you had such a great experience, Douglas! Thank you for sharing! It’s a pleasure to serve you!

  4. We just refinanced with Quicken Loans and it was very efficient. In the past we have had our mortgages sold after settlement and never had an issue. This is the way most lenders operate. I think we should try to understand this is how money is freed up to help others. Thanks for your hard work on our refinance.
    Linda W.

    1. Hi Linda:

      I’m glad to hear you had a good experience and really want to thank you for the kind words! Have a great day!

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