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Originally Posted by manros
Can you please ellaborate a little more on the existence of that relationship between the bank and the third party? You said the bank got the money from a third party. How is that? I guess I can question the bank about the third party? Or I can not?
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The third party is a warehouseman, a facilitator, a vendor, a broker, pick the word you're most comfortable with. The point is that the bank procures the funds prior to lending them to you and does not use your promissory note as the basis of the loan. These vendors may be individual investors, hedge funds, investment banks or the Fed itself. But asking a superfluous question like where does the money come from, is like asking your grocer who supplies his produce. Who cares?
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Originally Posted by manros
Re: The equity. What is the legal basis (IF) for the bank's right to the equity on the home? It looks to me they only have right to the amount due to them, not to the "future equity". I am may be wrong on this for some reason.
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Equity is relative depending upon circumstance. It can be positive or negative. Your house is the collateral used to securitize your pledge to repay the loan and upon foreclosure will be repossessed according to the mortgage terms. The value of the house will be determined by its ultimate buyer and any positive equity belongs to the bank, just as any negative equity will be your liability. This is why, if you have any substantial equity, it would be wise to bring your payments current.
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Originally Posted by manros
By the way, they never told me about the existence of this Third Party. I understand I got the right to know about it. Is not that lack of proper disclosure?
Is this Third Party stepping into the deal after the agreement to loan the money? I was never told.
It does not feel right.
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Why do you feel you have a right to know where the bank gets its funds? As I said, they have many sources, and these transactions are unrelated to the one you have with the bank. Disclosure is not necessary.
gldskr