Can my loan be sold?
What happens if my lender goes out of business?

Your loan, as well as the servicing of a loan (collecting and processing monthly payments and other interactions), can be sold at any time. When a lender sells a loan, it is replenishing funds in order to lend more money. And, you will probably never be aware of the sale. The servicing of a loan is sold because some lenders don't have large enough servicing departments to handle the volume of business. However, when this occurs you will be aware of it. In fact, you must be notified of the transfer of service not less than 15 days prior to the effective date of transfer. During the 60-day period following the effective date of the transfer of the loan servicing, you may not be charged a late fee by the new service provider.

Please note that whenever a loan or its servicing is sold, the terms and conditions of the loan remain the same. You should continue making payments to the existing institution until you are notified otherwise in writing.

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