Mortgage servicers sometimes make serious errors when handling a homeowner's loan account. Fortunately, a federal law, the Real Estate Settlement Procedures Act (RESPA), provides a way for you to make the servicer correct the error if you believe it made a mistake when managing your mortgage payments. This law also gives you a way to get specific information about your account. Whether you want to notify the servicer about an error or get information about your account, you'll have to send your servicer a letter.
Under amendments to Regulation X, which implements RESPA, your letter will be considered a "notice of error" or a "request for information." Different time limits apply for when the servicer has to respond to your letter based on which type of request you send.
If you send a letter to notify the servicer about a particular error that it made when managing your loan, the servicer must correct the error, provide notification of the correction, and give contact information for you to follow up, or let you know that no error occurred along with the reasons for this conclusion.
With so many different duties and variables, there's a lot of room for error when it comes to loan servicing. Under the law, the following servicer errors can be addressed in a notice of error:
The servicer must acknowledge a written notice that asserts a particular error within five business days.
How much time the servicer gets to respond to your notice of error depends on the type of error that you claim the servicer committed:
The servicer may generally extend the 30-day period by 15 days if, within the 30-day period, it informs you about the extension and tells you why there is a delay. However, a 15-day extension is not allowed if your notice of error is about a payoff statement or certain errors pertaining to foreclosure.
A request for information can be useful if you're unsure whether the servicer made an error and want to get information about your account to help you make this determination. For example, you might want to see the servicer's records regarding your payment history.
If you send a written request for information, the servicer must acknowledge your inquiry within five days.
The servicer must generally give you the information you requested within 30 business days or explain why the information is not available, as well as provide you with the name and contact information of someone you can follow up with.
When the 30-day response period can be extended. The servicer gets 15 extra days to respond if it notifies you about the extension within the 30-day period and lets you know the cause of the delay.
When the servicer must respond sooner. The servicer must provide the information you requested within ten business days if you're trying to find out the identify, address, or other contact information for the owner of your mortgage loan.
The servicer doesn't have to address your notice of error or request for information in some situations, like if:
But the servicer can't just ignore your notice, even if it fits one of the four criteria above. It must notify you within five business days after determining that it doesn't have to deal with your notice or request, and give you the basis for the determination.
You can find a sample notice of error letter and request for information letter, along with useful information about what to include in the letter, at the Consumer Financial Protection Bureau's website.
If you're sending a notice of error and also want to request specific information, you can send a single letter. Or you can send your notice of error and request for information letters separately.
If the servicer doesn't respond to your notice of error or request for information or if the servicer disagrees that it made an error or refuses to provide you with certain information, consider consulting with a lawyer. If you're facing an imminent foreclosure sale, talk to an attorney right away. Sending the servicer a notice of error or request for information is very unlikely to stop a foreclosure. An attorney can advise you about what to do in your situation and help you enforce your rights.
It's also a good idea to talk to a HUD-approved housing counselor if you're having trouble with your mortgage payments or facing a foreclosure.