The Basics of Your Mortgage Note
The Basics of Your Mortgage Note
The term “mortgage note” most likely signals that this document is something important for Kenai home buyers. You probably figured that you should know what it is and what to do with it. But many people are actually confused about those answers.
A mortgage note is given to you by your mortgage lender. It’s a document that Kenai home buyers signed at closing to make the deal legitimate. However, you probably signed a lot of papers on the closing day and might not remember exactly what this one is.
Basics of a mortgage note
Your mortgage note includes all the important information that you need to know about your mortgage. This includes information about the length of your loan, the interest rate, due date of your payment, and penalties for defaulting on the loan.
But, more than just including the details of your loan, your mortgage note is the legal document that gives the lender the right to take possession of your Kenai property if you default on a loan. This is the document that shows that you are entitled to the property while you are paying your mortgage properly.
So, while your note isn’t something that you are going to need access to on a regular basis, it’s important that you keep it in a safe place and know where to find it.
What if you don’t have a bank loan?
If you purchased your Kenai property through owner financing you will still have a mortgage note. The previous owner is selling you the Kenai property on the basis that you are going to pay them the money over time. Essentially, they are providing you with both the property and the financing in order to buy the property.
You want to hold on to your note to make sure that when you have made your payments you have the proof showing that the property is yours.
Selling mortgage notes
It is not uncommon for a bank to bundle together multiple mortgage notes and sell them to another lender. If this happens, you will not know about it until after the fact. You will be contacted with the new information of where to make your payments.
When this happens all of the terms of your mortgage note remain the same. The new lender is not able to make changes to your interest rate, term, or any other part of the note unless it is already agreed upon.
If you are interested in investing in property, you can actually purchase other people’s mortgage notes. This is a way to invest into real estate without needing to become a landlord. If you are interested in doing this, you will need to find a mortgage note brokerage to help you get started.
If you have any questions on your mortgage note before signing or after signing, make sure to address them with your mortgage lender. This is an important legal document and you need to understand what you are signing before you agree to it. Should you find you have questions about it after the fact you can still contact your lender and they can answer your questions, but they will not be able to make changes to the terms of your loan.