Government in the Loan Servicing Business


I have a quick question after reading Christine Dunn’s Providence Journal article on the quasi-public Rhode Island Housing’s new deal with Maine Housing to service the latter’s mortgage loans:

“The agreement will allow Rhode Island Housing to generate additional funds to be used to support programs, including the financing of housing to meet the state’s growing demand,” the agency said in its announcement Thursday.

Why is this a government agency?  Somewhere in the deal must exist some artificial restriction from government or some implicit public backing of the business.  Whatever the case, if RI Housing is engaged in profitable business, it ought to be spun off from government because that oughtn’t be the way government operates.

  • Rhett Hardwick

    Servicing contracts effectively sever the connection between the borrower and the lender. Got a problem with your mortgage that is being “serviced”, try contacting the actual lender.

  • OceanStateCurrent

    However it’s registered, it’s a creation of the state government and bills itself as a public agency.