If your lender goes out of business or just decides he'd rather have cash for your loan than the loan itself, he can sell it at any time. The secondary mortgage market is very strong, and it's quite common for pools of mortgages to be sold. In the long run, this secondary market ensures consumers will have lower rates overall.

When a secondary market lender buys your loan, they assume all terms and conditions of the original loan; the only change you should see is in the address you mail your payment to. Your existing lender will notify you in advance, and give you the information you need to continue making payments on time.

You still must make payments to a lender who goes out of business; most of those loans are sold to another lender, just as a building might be sold to a new business. The new owner of your note is obliged to honor the terms and conditions of the original loan, just like any other note buyer. Always make payments to your original lender until you are notified to change the address, etc., to your new lender.