What is a Mortgage Buyer?
The term mortgage buyer means just what it sounds like. It simply refers to an individual or entity that purchases mortgage notes from lenders. Buying or selling a mortgage can prove to be a win-win situation for the seller and mortgage buyer alike. If the note holder prefers to collect a lump sum of money all at once instead of collecting installment payments on a periodic basis, selling the note to a mortgage buyer may be a good option. You may be wondering why this option is a good deal for the mortgage buyer, if he or she has to collect on an investment over time. The truth is a mortgage buyer will offer the note holder less than the mortgage is worth, while still collecting the full payment amount from the borrower, thus turning a profit. Since the mortgage buyer absorbs the risk in the transaction, the buyer sets the price. A mortgage buyer may have very little risk if the borrower is reliable and the note has a fixed rate. However, if the payee has a questionable payment history
