Home : Blogs : Scott Gormley : California Home Loans

We Hate Our Mortgage Servicer and Want to Refinance NOW!

I don't know why, but I've had several clients over the past few months that have had bad experiences with the mortgage companies that are servicing their existing home loans. So, these borrowers contact me, wanting to refinance and get away from the headache. They then tell me to obviously not refinance it with the original lender or existing lender. But, many borrowers fail to realize that when you go to escrow to sign your paperwork for a new home loan, the original lender will almost always reserve the right to sell your loan to another lender to service the debt.

What I'm finding is that many of these borrowers have great terms on their mortgage, but they are getting fed up with poor communication on the mortgage servicer's side.

What does a client do when they have a great loan with great terms and make numerous attempts to pay their mortgage on time, only for the mortgage servicer to send 30 day lates to the credit reporting agencies?

We had a lender on one of our homes that criticized us for wanting to receive hard statements in the mail, claiming that they can be found online! Ummm, not everyone has a computer! I do, but what if I prefer to have hard statements for my records?

So with that, they have chosen to refinance their home, even though the mortgage might be slightly higher every month...Simply for a peace of mind of not having to deal with that company anymore.

If you are in such a situation right now in California...Give me a call...We'll find you a company that will treat you better!

Afterall, life it too short for such things...

Scott Gormley
Broker/Owner
Oak Valley Mortgage
2006 Chico Assoc. of Realtors Affiliate Chairman
Direct: 530.592.8362
Fax: 530.267.5555
Website: http://www.CALoan.com

Blog: http://www.CARealEstateBlog.com

"You find the perfect home, we'll find the perfect loan!"

Posted by Scott Gormley on 03/29/2007 01:52 PM

Comments (16)

Post is included in group: LOAN SCENARIO HELPLINE

16 Comments on We Hate Our Mortgage Servicer and Want to Refinance NOW!

So, they refi and the loan is sold off to another lousy servicing lender or the same one again? I guess I'd put the with countrywide or someone who raraly sells?

03/29/2007 01:56 PM

by Keith Jeppson - Salt Lake City Real Estate (Keller Williams Utah Realty)

I've had mortgages that have sold many times. It seems as though every time you turn around, your mortgage is being sold. I have never had any trouble no matter who is servicing the mortgage.

03/29/2007 01:58 PM

by Roger Stensland (Brio Realty)

Hi Keith,

I typically tell the client that I will place the loan with an investor that has a "track record" of keeping the loan in their own portfolio..Yes, Countrywide is a great example :)

Scott

03/29/2007 02:11 PM

by Oak Valley Mortgage-California Home Loans and Refinancing

Guess they could look for a local bank that has an in house portfolio but that is getting scarcer everyday.

03/29/2007 02:19 PM

by Diane Bell, Hilton Head Real Estate, Bluffton (Charter 1 Real Estate, Hilton Head, Bluffton, SC)

Actually Countrywide is among the worst when it comes to customer service. This is based on what my current and past clients have told me. Countrywide will prematurely assess a 30 day on a "valued" client then drag ass to fix this mistake.

My personal mortgage was just sold to Countrywide and they better not dare mess with me like that.

Eddy

03/29/2007 02:22 PM

by Eddy Martinez (Nationwide Funding Group)

I've never had an issue when the loan has been sold and serviced by another lender.

Every lender i have ever dealt with sends you paper statement in the mail every month UNLESS you specifically ask for the loan to be set up online or automatically deducted from your bank acct.

as long as all the terms are correct should anyone really care who is servicing it? I honestly don't.

DOMINICK GACCINO

Branch Manager

First Suffolk Mortgage Corp

03/29/2007 02:26 PM

by Dominick gaccino

You would care if they were giving you credit problems with false reportings, late fees and poor communication Dominick...

Scott

03/29/2007 02:30 PM

by Oak Valley Mortgage-California Home Loans and Refinancing

It is all about perception when it comes to servicing. Everyone has their own interpretation of it. The fact that your customers go to you when they have those issues is awesome and am sure you can place them with a portfolio bank that will have less chance of selling. Countrywide and Wells will still sell your loan but retain servicing rights to it for the duration of the mortgage. There is not 100 percent solution for these issues, but when the client is in need of a better situation your there with solutions is all that matters.

03/29/2007 02:32 PM

by John Hudson (Formerly of WELLS FARGO)

What most people forget is that any servicer is staffed with employees being paid the minimum amount that it takes to keep them employed. At that point the loan is being serviced, not the client. Some companies create a better customer service culture, but untilimately, they are all big businesses with employees pushing paper.

03/29/2007 02:50 PM

by Larry Morris, CMPS, Newberg Oregon (NW Lending Solutions)

as i said i have NEVER heard of a case of that

im not shopping a loan around based on what i think the companies servicing may be....im doing it based on rate, turn time and if the lender may be having a special that month.

Also you can place a loan with 1 lender(who you hear has great servicing) and it can be sold (to a lender who has what you think is terrible servicing) then what?

nothing you can do about that

but as i said i have never come accross a servicing issue after the fact with any of my clienst with any of the lenders i have used

03/29/2007 02:55 PM

by Dominick gaccino

Thats one of the many reasons I love being a mortgage banker. I have my name on every single mortgage statement sent to my borrowers. We never ever sell our loans.

03/29/2007 10:53 PM

by Jacob Morales - Arizona Mortgage Planner (US Bank)

Jacob, as a mortgage banker has the buyback dilemma affected you in any way?

Eddy

03/30/2007 06:25 PM

by Eddy Martinez (Nationwide Funding Group)

Not thus far it hasn't. I am very fortunate to be in the position I am because of that. Mind you our guidelines are getting to just be silly, but that is just par for the course these days.

03/30/2007 06:29 PM

by Jacob Morales - Arizona Mortgage Planner (US Bank)

Scott- about five years ago I had one of these that ended up charging me about 6 months of late payments because they only deposited checks about 3 business days after they were received and yes I fought and had them removed and yes refinanced to get away from them.

03/31/2007 01:54 AM

by Dan Allred Thousand Oaks Real Estate (Exit Family Realty)

Actually Countrywide sells all of their loans but, remains the servicing agent.

A client of mine is having this issue with WAMU right now, if their payment is not there on the 1st they get 8-10 calls a day asking when they can expect the payment. This month they started receiving calls on the 25th to find out when they might expect to receive their April payment. These clients are so fed up with WAMU that they now walk their payment in on the 15th to a local branch. When they inquired about the phone call the WAMU rep said "for every day you don't make you're payment that's interest money we're losing." That just pissed the client off.

It's a tough business right now as lenders disappear overnight. It's been rumored that WAMU has been in trouble the past couple of years. Being the kings of ARM's maybe they're not doing so well. I spoke to someone in-house at WAMU who said they are taking homes back left and right, seems their sub-prime side Long Beach Mortgage was doing whatever it took to get loans through. Now they're taking them back.

Edit: The only two banks I know that don't sell their loans are Union (strictly higher dollar great credit) and World (more equity, less credit based)

03/31/2007 01:06 PM

by Ed Brophy - Mortgage Consultant (Synergy Mortgage)

Jacob thats good. Its shows that you were a responsible mortgage banker.

Yes current guidelines are a little bit over the top but what can you do ? Just roll with the punches

Eddy

03/31/2007 05:08 PM

by Eddy Martinez (Nationwide Funding Group)