Is it legal for a bank to sell a loan that is under investigation for mortgage fraud? 5 Answers as of January 02, 2014

My bank forged mine and my wife's signature on a loan modification in 2007 while I was militarily deployed, it is currently under investigation in their fraud department. A week after I brought this up with them, they sold my loan to another bank. Is it legal for them to do this?

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Janke Legal Consulting | Bruce C. Janke
I don't see any legal reason for not being allowed to sell the loan. The original lender is going to have to answer for any fraud that is discovered regardless of who owns the loan. You should not rely on the bank's internal investigation. You should report the matter to the authorities. Here is a link to a web site with information: http://www.occ.gov/topics/consumer-protection/fraud-resources/index-fraud-resources.html In any case, if the original lender is engaging in this type of fraud, you are probably better off with your loan being held by a different lender. The terms of your loan do not change. Banks frequently resell their customers loans and there is generally no downside to the customer.
Answer Applies to: California
Replied: 1/2/2014
Stacy Joel Safion, Esq.
Stacy Joel Safion, Esq. | Stacy Joel Safion
Yes they can sell your loan.
Answer Applies to: California
Replied: 1/2/2014
Law Offices of Linda Rose Fessler | Linda Fessler
Yes, they can. But it will not change the facts. Now you have two parties to sue.
Answer Applies to: California
Replied: 1/2/2014
Penglase & Benson, Inc.
Penglase & Benson, Inc. | John Benson
It is legal for a bank to sell your loan. It is illegal for any entity or person to forge your signature. You should bring the matter to the Police and consider a civil suit against the bank.
Answer Applies to: Pennsylvania
Replied: 1/2/2014
The Law Office of Darren Aronow, PC
The Law Office of Darren Aronow, PC | Darren Aronow
They have the right to sell, transfer and assign your mortgage whenever they want. They have to give you notice though. The new lender is still liable for their fraud so if you have an issue, you should still pursue it.
Answer Applies to: New York
Replied: 1/2/2014
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