The first letter you get is from your current bank.
How many have automatic payments setup that would just stop when the loan is sold?
I think I would notice if my largest bill wasn’t deducted from my bank account.
But at the end of the day, the bank doesn’t want your house. They don’t want to go through the trouble of foreclosure, for being responsible for maintenance while it’s being sold. They don’t want to go through the hassle of selling your house.
You will get letters, phone calls, notices, court dates, etc before your house goes into foreclosure. I doubt that people are sending thier payments to the wrong place long enough to go into foreclose.
Where in that letter can I say "I object to this transaction"?
Where in that letter can I say "I will be emotionally and/or financially damaged by this transaction"?
Where in that letter can I tell the bank that the new bank does not personally know me and I do not believe it can fulfill the obligations to Know Your Customer?
I think, from a consumer perspective, the answer here is the originating bank of the loan should be responsible for the lifetime of the loan for servicing it, even if they sell the debt itself to another party. This simple act would simplify immensely the process for the consumer and probably put a bit more pressure on the banks to get the paperwork right.