Legal Question in Real Estate Law in Michigan

My mortgage holder has stopped doing business and is likely to file for bankruptcy. My last payment (check) has not been cashed. I cannnot contact them via phone or e-mail. The mortgage is a conventional loan, and has remained with this mortgage company since I refinanced a few years ago. It is not backed by FHA, Fannie, Freddie... What happens when the holder of your mortgage goes bankrupt?


Asked on 8/25/09, 3:01 pm

1 Answer from Attorneys
Brad Aldrich Aldrich Legal Services

The assets of that company, such as mortage notes like yours, will be sold off to another lender/servicer, who will then step in and be entitled to the remaining payments under the mortgage. Lenders include language in the mortgage and note that they can assign, sell or otherwise convey the loan to another entity, but of course you the borrower have no such option. The new lender/servicer will obviously have to cut you some break for the time period in which you did not know who to pay your mortgage to and if they give you a hard time on this you may need to speak to an attorney. Aldrich Legal Services, PLLC specializes in Real Estate law, along with Bankruptcy, Probate/Estate Planning, Family law and other areas of the law. If we can be of service to you please visit our website at aldrichlegalservices.com or call me directly at (734) 404-3000 for a free consultation.

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Answered on 9/02/09, 5:08 pm


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