Change of lenders does not change terms of loan

Q: Hi, Edith. In a recent column, someone asked about escrow. You educated them, but it made me think particularly about mortgages being sold.

I bought my house in 2014. My lender is in a different state. I handle my taxes and pay my own homeowners insurance. I send extra money in with my mortgage payment each month. It amounts to one extra payment a year, and I write each extra payment on a separate check that clearly indicates it is as an additional payment on the principal.

My question is, how do I know whether my mortgage holder will sell my mortgage? If it does, won’t I be back to square one in regard to paying off my mortgage early?

Is there any way to prevent my mortgage from being sold, especially if the interest rates are rising?

Perhaps the mortgage holder wants to free up cash to take on another mortgage at a higher interest rate.

— K.K.

A: The mortgage document you signed probably says that the lender has the right to sell your debt. Dig it out and take a look. Not to worry, though. If that were to happen, all your original terms and provisions would remain exactly as they are, and the remaining debt should reflect your extra prepayments.

Of course, that mortgage is a big part of your financial picture. But to the lender, it’s just an asset, and a little one at that. Mortgages are gathered into packages and sold all the time, often because — as you suggest — the lender wants to free up cash for additional investments. Because you are handling your own property tax and insurance bills and making extra principal payments, your loan is a bit unusual. It might not fit into a package of similar mortgages. But if it were to be sold, you should be notified by both your present lender and the new one within 15 days of the sale.

At that point, you’d want to double-check the next mortgage statement you receive to make sure it’s accurate. That’s particularly important because of those extra principal payments. The notifications would include information about where to contact the lenders if there were a question. In the case of a mix-up, you’d have a two-month period to straighten things out without paying any late fees or reporting to credit agencies.

Likes empty houses

Q: I agree with your reader L.B.T. about staging homes. I’ve been shopping for a house for the last year. I’ve seen houses with the sellers’ furnishings; I’ve seen empty houses; and I’ve seen staged ones.

My preference is seeing an empty house. It allows me to envision my own furniture in there and where I would possibly place it. I can see all the electrical and cable outlets and all the walls and floors, which allows me to make sure they’re all in good shape. I can see the basement walls and floors to be sure there are no big cracks or other problems. And I get to see the house itself, not the furniture and accessories I won’t purchase and therefore have no reason to see.

I feel that staging is a bit of advertising by the furniture stores and professional stagers. I’m sure if a prospective buyer were to ask if they could buy an item, they would be told yes immediately or told where they could purchase the exact piece. Give me an empty house every time!

— M.K.B.,

A: Thanks for sharing your experience.

Notice to tenant

Q: I have a tenant on a month-to-month lease. I thought New York State requires that the tenant to give the landlord one month’s notice and that the notice must be given during the month before the last month. For example, if tenants want to vacate the apartment at the end of December, they must give notice before the end of November. Could they give notice on Dec. 7 to vacate on Jan. 7? Where can I find the legal information on this?

— D.K.

A: You can find the legal information — or at least this answer — in my textbook for New York real estate licensees. I wrote:

“To end a month-to-month tenancy, New York State requires one month’s written notice; New York City requires 30 days’ notice. Notice must be given at least one day before a date on which rent is due.” So your November/December example is correct.

Similar regulations apply in most states, but not all. In some states, less notice is required — two weeks’, for instance. Some jurisdictions, on the other hand, allow notice to be given on any day of the month and then allow the tenant to remain until a date when the rent would be due.

Different requirements can be binding if they’re written into leases. Typically, though, month-to-month tenants don’t have written leases anyhow.

Contact Edith Lank at, at or at 240 Hemingway Drive, Rochester, NY 14620.

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