What To Do If Rocket Mortgage Sold Your Loan

If you recently got a mortgage with Rocket Mortgage, you may have received a notice that your loan has been sold This can be alarming if you don’t understand what it means But there’s no need to panic – it’s actually a very common practice in the mortgage industry. In this article, I’ll explain what it means when Rocket Mortgage sells your loan, why they do it, and most importantly, what impact it will have on you as the homeowner.

Why Do Lenders Like Rocket Mortgage Sell Loans?

The main reason lenders sell loans is to replenish their available capital so they can continue lending to new homebuyers. When Rocket Mortgage lends you money for your mortgage, those funds get tied up in your loan for potentially 30 years By selling your loan to investors, Rocket Mortgage gets that money back right away so they can lend it out again in a new mortgage. This recycling of capital is what allows lenders to stay in business

Selling loans also reduces risk for the lender. If they kept every mortgage on their books for 30 years, they’d be on the hook if you defaulted on your loan But by selling it to investors, that risk gets transferred. Investors are often large institutions like Fannie Mae and Freddie Mac that can absorb losses better

Lastly, selling loans generates revenue for lenders like Rocket Mortgage. They collect fees and commissions from the sale. So while they have to wait decades to collect interest payments from you, selling your loan generates immediate income.

Who Buys These Loans?

The entities that end up owning your mortgage are called mortgage investors. The two main types are:

Government-sponsored enterprises (GSEs): These are companies like Fannie Mae and Freddie Mac that are privately run but were chartered by Congress. They buy loans from lenders like Rocket Mortgage, bundle them into mortgage-backed securities, and sell those securities to other private investors. This injects liquidity into the housing market.

Government agencies: These include FHA, USDA, and VA. They have credit requirements loans must meet to qualify for government backing. Lenders sell qualifying loans to these agencies, providing more funds for government housing programs.

What Changes For You as the Homeowner?

Now for the most important question – how does Rocket Mortgage selling your loan affect you? The short answer is: probably not much, if at all.

Here are key things to know:

  • The loan terms do not change. Your interest rate, payment amount, length of loan – all of that is fixed based on your original mortgage contract.

  • You still pay your normal mortgage payment. The only difference is you’ll now be sending that payment to the new investor rather than Rocket Mortgage.

  • You’ll get notifications. First Rocket Mortgage will send you a notice that they sold the loan. Then your new lender will introduce themselves. This is required by law.

So from a practical perspective, you just have a new mailing address for sending your mortgage checks. Everything else remains the same because it’s protected by your original loan documents.

Will Your Loan Servicer Change?

One detail that often does change when loans are sold is the company servicing your mortgage. The servicer is the entity that handles payment collection, record-keeping, escrow accounts, and customer service. Rocket Mortgage may keep servicing even after selling your loan, but not always.

If the servicing is transferring along with loan ownership, here’s what to expect:

  • You’ll get notices from both the old and new servicer informing you of the change. This includes contact information for the new company.

  • You’ll need to update any automatic payments or online account info to the new servicer.

  • For 60 days after the transfer, you can’t be charged a late fee if you accidentally still pay the old servicer.

As long as you review the notices promptly and update your payment details, the transition should be relatively seamless. Reach out to both servicers if you have any questions.

Should You Worry if Rocket Mortgage Sells Your Loan?

While learning your mortgage has been sold can be unsettling at first, there’s no reason to worry. As covered above, Rocket Mortgage sells loans as part of standard business operations, not because there’s an issue with your loan. And legally, the core terms of your mortgage cannot change.

Here are some tips for making sure the sale goes smoothly:

  • Read any notices from Rocket Mortgage and your new lender carefully so you know the exact date the new investor will start accepting payments.

  • If your servicer is changing, be proactive in setting up your new online account or auto-pay. Better to do this early than risk a late payment.

  • Follow up with both companies to confirm the old servicer received your last payment and the new servicer got your first payment.

  • Save copies of any notices you receive. This helps document you were properly notified in case any errors occur.

While it can be an adjustment when your mortgage gets sold, a bit of preparation means the process should be seamless. The most important thing is simply continuing to make your normal monthly payments so you stay on track paying off your home.

Frequently Asked Questions About Rocket Mortgage Selling Loans

If you just learned your Rocket Mortgage loan was sold, you probably still have some questions. Here are answers to some common queries:

Does Rocket Mortgage selling my loan mean I have a “bad” mortgage?

No, it does not mean there’s an issue with your loan or that you’re high risk. As covered above, selling mortgages is standard procedure for lenders.

What if I already sent this month’s payment to Rocket Mortgage?

Contact both Rocket and the new servicer. There is normally a 60-day grace period where previous servicer accepts payments without a late fee. Get confirmation your last payment to Rocket Mortgage was credited properly.

Could the new investors raise my interest rate?

No. The interest rate and other terms are locked in per your original mortgage documents and cannot change just because a new investor buys the loan.

Do I have to change my homeowners insurance?

Probably not. But some investors require maintaining escrow accounts for taxes and insurance. Check with your new servicer about any potential changes.

What if I have an issue with my new servicer or investor?

First, raise the issue directly with them and see if it can be resolved. You can also file a complaint with the CFPB or your state mortgage regulatory agency if problems persist.

Can I choose which investor buys my loan or buy it back myself?

No, you don’t have control over which investor purchases your mortgage. And it’s highly unlikely you’d be able to buy the loan back yourself.

Could my new investor foreclose more easily than Rocket Mortgage?

The foreclosure process is governed by federal regulations and state law, regardless of who owns your loan. As long as you pay on time, there should be no change in foreclosure risk if your loan is sold.

The Bottom Line

If handled properly, Rocket Mortgage selling your home loan should have minimal impact on you as the borrower. It’s extremely common for mortgages to be sold between lenders and investors as a normal part of business operations. The key is staying organized, updating your payment details promptly, and maintaining open communication with Rocket and your new servicer. Don’t panic when you get the notice – just take reasonable steps to ensure the transition goes smoothly. And above all, be sure to keep making all your mortgage payments on time no matter who currently owns the loan. That will keep you on solid footing as a homeowner.

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