Did we get a good rate?

emmaHarris_2

Hello Dai,

It may be a good idea to ask them up front for a copy of the terms and conditions before going forward. By the information you provided your a prime borrower. GMAC-RFC is a 'mainly' a sub prime lender although they advertise as:

GMAC-RFC offer 'Mortgages for Everyone' from Mainstream, Buy to Let, Self-Certification and also for borrowers who have experienced credit difficulties. GMAC-RFC have a wide range of mortgage products to suit every need.

It's what they do with your mortgage post completion that is important too.

emmaHarris_2

but he did not mention there was anything in the T&C's that they can sell my mortgage at anytime to anyone.

Hi Maka,

This is normally provided after a verbal agreement is given and at the completion stage 'IF' it is going to be there in your personal case then this is when you will first see it, just when your going to sign. GMAC operate like most sub prime lenders...they buy and sell mortgages through securitisation and whole loan sales and this how they make their profits.

emmaHarris_2

From their web site:

The way we work

We want to offer our customers a wide range of innovative mortgages, and what enables us to do this is the way that we operate - we create and trade mortgage assets. Put simply, the mortgages that we create through our lending activities are then "traded" as either securitised bonds for investment or transferred as portfolio sales to other mortgage lenders.
What it means for us is that we can use any profits that we make quickly and invest them into our products and services. This may sound scary, but it isn't. Our customers' mortgage terms and conditions always remain the same as specified within the terms of our offer of mortgage and our customers are not adversely affected.

emmaHarris_2

Our customers' mortgage terms and conditions always remain the same as specified within the terms of our offer of mortgage and our customers are not adversely affected.

I personally do not agree with this statement!

emmaHarris_2

http://www.gmacrfc.co.uk/render.aspx?siteID=1&navIDs=1,3,12,40

emmaHarris_2

Hi Maka,,
It may be a good idea to ask GMAC for a copy of the terms and conditions or as previous posters advise maybe see another broker or IFA to get second opinion. Ask them openly: (they will not appreciate you asking these)!

Will you be selling or transferring my mortgage account?
Who will this be sold or transferred too?
What kind of company will they be?
Will I be able to borrow again if the need arises?
May I release equity in my home?
What if I have a temporary setback how will they help?

My thoughts are that they will administer only your mortgage account as per the original terms and conditions and the new company will not employ Mortgage Advisors and as such those terms cannot change during the term of the mortgage.

Once sold or transferred as part of securitisation or whole loan sale you become part of a small portfolio (normally 500-700 properties or £100m value of the portfolio). So you will not be part of a huge volume of other customers. They will be more concerned on the overall performance of the portfolio and not so much customer care.

By this time they have made the profit and your broker will have received a handsome commission.

It is then that the treatment changes.

MortgageMamma

Hi Emma,

Whilst I can respect the often very valid points in what you are saying, I think you are driving your point home a little too hard with the posters on here. I'm not criticising you personally, I'm just thinking of it from a posters point of view.

Most don't have the advantage as being as knowledgeable as you and me, and I think you could confuse them a bit.

What I suggest is, if you haven't already done it, why not ask Martin Lewis to investigate securitisation and write an article on it for the site? it would be useful for public and brokers alike.

I'm sure the message you are trying to convey is out of kindness and wanting to raise public awareness, but an unbiased report would inform the public of the actual facts, and not just yours or your groups perception of them, I feel it would be beneficial.

I personally feel like your posts are becoming extremist. I am not saying this to cause a conflict with you, and indeed will not enter into one, these are just my personal feelings.

MM

emmaHarris_2

Hi MM

Thank you and I do respect what you say. My intention is not in anyway to become extremist.

However, sometimes when you have learnt something it is nice to share with others too. I hope by supporting (as above) and informing what securitisation and whole loan sales is and the kind of business module that sub prime lenders use in direct contrast to the normal expected traditional methods then maybe it will provide food for thought before entering into something they knew little about and then suffering the consequences later. At least people can make an informed decision. There is very little consumer knowledge about this and therefore if it is not known people can’t ask. We are not alarmist but as you say raising a little awareness that’s all. Really there is no bias from me.

MortgageMamma

Thanks Emma

I do respect what you are saying and trying to do, but I think a formal report on securitisation would be excellent reading. How did you get into this issue anyway? Was it something that happened to you or someone you know or is it through work?

emmaHarris_2

MM, Hi again, May I give you just one quick example.

as either securitised bonds for investment or transferred as portfolio sales to other mortgage lenders.

Britannia for example could purchase this portfolio. They will create a new subsidiary called Mortgage Agency Number Six LIMITED (MAS6). They will apply and get FSA authorisation to be a 'lender. You are not a member of Britannia. MAS6 cannot lend and have no intention too either or do they originate mortgage loans direct to the public, or can they change the terms of the contract. It is created to manage the portfolio specifically and to present to the borrower that all is OK and that you’re still with a mortgage company. You’re not though. How can this help the borrower? But they didn’t deceive as the original purchase of the mortgage loan was by a mortgage lender but it is what they do not tell you is important. Please don’t shoot the messenger because the message is not liked. I really hope and respect that others will investigate a little more thats all by this.