To whom does the assignment of a mortgage loan typically transfer its rights and obligations?

The assignment of a mortgage loan typically transfers its rights and obligations to another party. This process involves a legal document that enables the lender to sell or transfer the rights to receive the mortgage payments to a different entity, which may be another lending institution or an investor. This assignment does not necessitate the involvement of the original borrower or even a mortgage broker; rather, it can involve various types of third parties in the real estate finance industry.

When a mortgage is assigned, the original lender (or servicer) remains involved for a time, but ultimately, the entity receiving the assignment takes over the role of collecting payments and managing the loan. This flexibility in assignments can help maintain liquidity in the mortgage market, as mortgages can be sold and purchased, which is crucial for the stability and functioning of the lending system.