What is the difference between a lender and trustee?

Submitted by SherylRyan from - 07/07/2008 - 9:25am

If I want to buy a house directly from the bank (the REO section of this website), would I call the lender or the trustee?
Thanks.

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Comments

Submitted by Sean - 07/07/2008 - 11:09pm

The lender is whom you will need to contact, though you may find the trustee helpful in reaching the correct person at the lender.
In deed of trust states like California, the trustee is a 3rd party that holds the deed to your house "in trust" until you have paid off the lender. If you fail to pay the lender, then at the lenders request the trustee can foreclose and if the borrower fails to cure the default they can sell the property. In practice it may seem there is little difference between the lender and the trustee, and you will even find lenders that own trustee companies. But that doesn't change the fact that the trustee has a fiduciary responsibility under the law to protect BOTH the lenders and the homeowners interest in the property.
More importantly to your question though is that at times it can be easier to track down the trustee that handled a particular property, then the asset manager within the lender that has been assigned the file. And the trustee will have the lender contact info you need.
Just keep in mind that the trustee is under no obligation to give you that name and number, so if you do reach them be sure to pour on the honey and ask for their help as sweetly as possible.

Submitted by get rich quick - 12/10/2008 - 2:19am

Deed of trusts and mortgage differences only affect homeowners when
foreclosing becomes an issue. In this case, the trustee sells your home
once your loan becomes delinquent. Once the lender provides the trustee
with proof of this type of occurrence, the request to foreclose begins.

Submitted by tampa divorce lawyers - 01/24/2009 - 12:32am

A Florida lender uses a mortgage for the same reason. But the main
reason is speed. Speed in foreclosure, that is. Generally, DOTs allow
for a faster foreclosure time than the judicial foreclosure required
with a mortgage.

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