RESPA Flashcards | Quizlet An error relating to a subsequent sale or securitization of a mortgage loan; iv. 2. Mortgage servicing regulations: Oral notices of error dropped - RESPA News PDF Regulation X Real Estate Settlement Procedures Act - Federal Reserve Board A servicer shall provide a written notice to a borrower before any change in the address used for receiving a notice of error. Obtaining appeal. Foreclosure sale not scheduled. in Supplement I. Reasons listed. If an application was not subject to 1024.41 prior to a transfer, then for purposes of 1024.41(b) and (c), a transferee servicer is considered to have received the loss mitigation application on the transfer date. (B) Prior to the date of a foreclosure sale or within 30 days (excluding legal public holidays, Saturdays, and Sundays) after the servicer receives the notice of error, whichever is earlier, for errors asserted under paragraphs (b)(9) and (10) of this section. Riley sent the required notices timely. (C) Unresponsive borrower. 1. Information not in the borrower's control. (1) Adverse information. A servicer shall not charge a fee, or require a borrower to make any payment that may be owed on a borrower's account, as a condition of responding to a notice of error. Visit Services to Download full samples of our products. (ii) A servicer is not required to provide a notice pursuant to paragraph (c)(3)(i) of this section if: (A) The servicer has already provided the borrower a notice under paragraph (b)(2)(i)(B) of this section informing the borrower that the application is complete and the servicer has not subsequently requested additional information or a corrected version of a previously submitted document from the borrower pursuant to paragraph (c)(2)(iv) of this section; (B) The application was not complete or facially complete more than 37 days before a foreclosure sale; or. Whether a document is considered the first notice or filing is determined on the basis of foreclosure procedure under the applicable State law. What is the definition of a qualified written request? Applicability of loss mitigation provisions. If the servicer failed to provide you with an accurate payback statement after requesting one, they must answer within seven business days of receiving your letter. A qualified written request, or QWR, is a letter addressed to the servicer that includes the following information: The letter must enable the servicer to identify the borrowers loan account and provide a summary of the reasons why the borrower believes the account is incorrect or a thorough explanation of the information the borrower is seeking to qualify as a QWR. In that circumstance, the transferee servicer is required to treat the appeal as a pending complete application, and it must permit the borrower to accept or reject any loss mitigation options offered by the transferor servicer, even if it does not offer the loss mitigation options offered by the transferor servicer, in addition to the loss mitigation options, if any, that the transferee servicer determines to offer the borrower based on its own evaluation of the borrower's complete loss mitigation application. (4) That the servicer will complete its evaluation of the borrower for all available loss mitigation options promptly upon receiving the documents or information. Official interpretation of 35(e)(3) Time limits. Comment for 1024.33 - Mortgage Servicing Transfers, Comment for 1024.34 - Timely Escrow Payments and Treatment of Escrow Balances, Comment for 1024.35 - Error Resolution Procedures, Comment for 1024.36 - Requests for Information, Comment for 1024.37 - Force-Placed Insurance. If a servicer receives a loss mitigation application from a potential successor in interest and elects not to review and evaluate the loss mitigation application before confirming that person's identity and ownership interest in the property, the servicer must preserve the loss mitigation application and all documents submitted in connection with the application, and, upon such confirmation, the servicer must review and evaluate the loss mitigation application in accordance with the procedures set forth in 1024.41 if the property is the confirmed successor in interest's principal residence and the procedures set forth in 1024.41 are otherwise applicable. Official interpretation of Paragraph 41(c)(3)(i). For purposes of 1024.41(b)(2)(i), if no foreclosure sale has been scheduled as of the date a servicer receives a loss mitigation application, the servicer must treat the application as having been received 45 days or more before any foreclosure sale. Please contact me via my contact form at vcita:Contact Form for Free 100% Consultation. For example, if a servicer requires a consumer report for a loss mitigation evaluation, a loss mitigation application is considered complete if a borrower has submitted all information required from the borrower without regard to whether a servicer has obtained a consumer report that a servicer has requested from a consumer reporting agency. (iii) Untimely notice of error. Short sale listing period. Short-term loss mitigation options and complete applications. I have been using Mortgage Audits Online for a few months and I am very pleased with the work. For example, assume that a borrower first submits a complete loss mitigation application on March 1, and the servicer provides the notice under 1024.41(c)(3)(i). In connection with a transfer, a transferor servicer must timely transfer, and a transferee servicer must obtain from the transferor servicer, documents and information submitted by a borrower in connection with a loss mitigation application, consistent with policies and procedures adopted pursuant to 1024.38(b)(4). In a Foreclosure, creating a QWR is beneficial because it forces the servicer to give information regarding the account, a QWR can be a strong weapon for a borrower facing foreclosure. A transferee servicer and a transferor servicer, however, are not the same servicer. 3. A Qualified Written Request (QWR) is a tool to get information about your mortgage or notify your mortgage servicer of an error. In that case, the servicer must react before the foreclosure sale or within 30 business days of receiving your letter. Consistent with policies and procedures maintained pursuant to 1024.38(b)(4), the transferor servicer must timely transfer, and the transferee servicer must obtain, documents and information regarding such acceptances and rejections, and the transferee servicer must provide the borrower with any timely accepted loss mitigation option, even if the borrower submitted the acceptance to the transferor servicer. An error relating to a determination to sell, assign, or transfer the servicing of a mortgage loan. Consistent with policies and procedures maintained pursuant to 1024.38(b)(4), the transferor servicer must timely transfer, and the transferee servicer must obtain, documents and information regarding such appeals. PDF Section 1024.35 Error Resolution Procedures - NAFCU Compliance Blog Please know too, that I am recommending Mortgage Audits Online to all of my law associates.. Borrower fails to complete the application. Real Estate Settlement Procedures Act (RESPA) Flashcards Official interpretation of 41(d) Denial of loan modification options. in Supplement I. Short-term loss mitigation options and incomplete applications. (ii) Determine that no error occurred because the borrower failed to provide any requested information without conducting a reasonable investigation pursuant to paragraph (e)(1)(i)(B) of this section. Verified answer. Official interpretation of 41(c)(3) Notice of complete application. 2. Assume the servicer discovers on March 10 that it requires additional information or corrected documents to complete the application and promptly requests such additional information or documents from the borrower pursuant to 1024.41(c)(2)(iv). New CFPB Rule Protects Homeowners Facing Foreclosure A significant period of time under the circumstances may include consideration of the timing of the foreclosure process. Section 1024.41(k)(2)(ii) provides additional protections for borrowers but does not remove any protections. Official interpretation of 41(c)(2)(i) In general. in Supplement I. For example, a servicer complies with the requirement for evaluating the borrower for a short sale option if the servicer offers the borrower the opportunity to enter into a listing or marketing period agreement but indicates that specifics of an acceptable short sale transaction may be subject to further information obtained from an appraisal or title search. (i) Determining appeal. Specific payment terms and duration. #3: Basis for Obtaining Lender-Placed Insurance. (A) That the loss mitigation application is complete; (B) The date the servicer received the complete application; (C) That the servicer expects to complete its evaluation within 30 days of the date it received the complete application; (D) That the borrower is entitled to certain foreclosure protections because the servicer has received the complete application, and, as applicable, either: (1) If the servicer has not made the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process, that the servicer cannot make the first notice or filing required to commence or initiate the foreclosure process under applicable law before evaluating the borrower's complete application; or. At the time a servicer provides the written notice pursuant to 1024.41(c)(2)(iii), if the servicer lacks information necessary to determine the amount of a specific payment due during the program or plan (for example, because the borrower's interest rate will change to an unknown rate based on an index or because an escrow account computation year as defined in 1024.17(b) will end and the borrower's escrow payment might change), the servicer complies with the requirement to disclose the specific payment terms and duration of a short-term payment forbearance program or short-term repayment plan if the disclosures are based on the best information reasonably available to the servicer at the time the notice is provided and the written notice identifies which payment amounts may change, states that such payment amounts are estimates, and states the general reason that such payment amounts might change. Except as provided in paragraph (c)(4)(ii) of this section, if a servicer receives a complete loss mitigation application more than 37 days before a foreclosure sale, then, within 30 days of receiving the complete loss mitigation application, a servicer shall: 1. For purposes of 1024.41(c)(2)(iii), a payment forbearance program is a loss mitigation option pursuant to which a servicer allows a borrower to forgo making certain payments or portions of payments for a period of time. The court may direct the servicer to submit account information for the borrowers examination in a judicial foreclosure. 1024.37 Force-placed insurance. - Consumer Financial Protection Bureau (2) Types of insurance not considered force-placed insurance. If the borrower subsequently completes the application on March 21, the servicer must provide another notice in accordance with 1024.41(c)(3)(i), unless an exception applies under 1024.41(c)(3)(ii). The date that is 38 days before a foreclosure sale. If the borrower indicates a preference for a short sale or, more generally, not to retain the property, the servicer may not stop collecting documents and information from the borrower pertaining to available home retention options solely because the borrower has indicated such a preference, but the servicer may stop collecting such documents and information once the servicer receives information confirming that the borrower has an applicable hardship under requirements established by the owner or assignee, such as military Permanent Change of Station orders or employment transfer. (2) Requesting information from borrower. Originally, RESPA mandated the disclosure of mortgage costs, eliminated kickbacks and limited the use of escrow accounts. Borrower obligation to make payments. 12 CFR 1024.35 - Error resolution procedures. See interpretation of 41(c)(4)(i) Diligence requirements. These provisions are illustrated as follows: Assume a transferor servicer receives a borrower's initial loss mitigation application on October 1, and the loan is transferred five days (excluding legal public holidays, Saturdays, or Sundays) later, on October 8. For example, if the transferor servicer provided the notice required by 1024.41(b)(2)(i)(B) prior to the transfer, the transferee servicer is not required to provide the notice again for that application. A reasonable date for purposes of 1024.41(b)(2)(ii) must never be less than seven days from the date on which the servicer provides the written notice pursuant to 1024.41(b)(2)(i)(B). (1) The servicer made good faith efforts to establish live contact with the borrower after each payment due date, as required by 1024.39(a), during the 90-day period before the servicer makes the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process; (2) The servicer sent the written notice required by 1024.39(b) at least 10 days and no more than 45 days before the servicer makes the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process; (3) The servicer sent all notices required by this section, as applicable, during the 90-day period before the servicer makes the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process; and. (1) Pre-foreclosure review period. (d) Acknowledgment of receipt. (ii) Trial Loan Modification Plan. Except as provided in paragraphs (k)(2) through (4) of this section, if a transferee servicer acquires the servicing of a mortgage loan for which a loss mitigation application is pending as of the transfer date, the transferee servicer must comply with the requirements of this section for that loss mitigation application within the timeframes that were applicable to the transferor servicer based on the date the transferor servicer received the loss mitigation application. A borrower may submit an appeal of a transferor servicer's determination pursuant to 1024.41(h) to the transferor servicer after the transfer date. If a transferee servicer is required under this paragraph (k)(4) to make a determination on an appeal, the transferee servicer must complete the determination and provide the notice required by paragraph (h)(4) of this section within 30 days of the transfer date or 30 days of the date the borrower made the appeal, whichever is later. A borrower calls to ask about loss mitigation options and servicer personnel explain the loss mitigation options available to the borrower and the criteria for determining the borrower's eligibility for any such loss mitigation option. in Supplement I. Official interpretation of 35(e) Response to notice of error. 2. (7) Failure to provide accurate information to a borrower regarding loss mitigation options and foreclosure, as required by 1024.39. If the servicer later discovers that additional information or corrections to a previously submitted document are required to complete the application, the servicer must promptly request the missing information or corrected documents and treat the application as complete for the purposes of paragraphs (f)(2) and (g) of this section until the borrower is given a reasonable opportunity to complete the application. The written notice designating the specific address, required pursuant to 1024.35(c) and 1024.36(b). If the servicer makes the first notice or filing required by applicable law for any judicial or non-judicial foreclosure process before January 1, 2022, these records must include evidence demonstrating compliance with 1024.41(f)(3), including, if applicable, evidence that the servicer satisfied one of the procedural safeguards described in 1024.41(3)(ii). ANSWER (UPDATED 10/7/2020): Official interpretation of 41(c)(2) Incomplete loss mitigation application evaluation. Assume that Columbus Day, a legal public holiday, occurs on October 14, and the transferee servicer provides the notice required by 1024.41(b)(2)(i)(B) 10 days (excluding legal public holidays, Saturdays, or Sundays) after the transfer date, on October 23. Official interpretation of 41(k)(1)(i) Timing of compliance. (i) In general. in Supplement I, Explore guides to help you plan for big financial goals, Subpart A - General Provisions 1024.11024.5, Subpart B - Mortgage Settlement and Escrow Accounts 1024.61024.20, Subpart C - Mortgage Servicing 1024.301024.41, Supplement I to Part 1024 - Official Interpretations. The Real Estate Settlement Procedures Act, or RESPA, is designed to protect home buyers from getting taken advantage of by mortgage companies, home appraisers and other service providers. 5. Definition of evaluation. The conduct of a servicer's evaluation with respect to any loss mitigation option is in the sole discretion of a servicer. 2. This information can assist you in deciding whether or not to file a lawsuit to stop the non-judicial foreclosure. Where foreclosure procedure does not require an action or court proceeding, such as under a power of sale, a document is considered the first notice or filing if it is the earliest document required to be recorded or published to initiate the foreclosure process. iii. See comment 41(f)-1 for a description of whether a document is considered the first notice or filing under applicable law. Official interpretation of 41(b)(2)(ii) Time period disclosure. See interpretation of 35(c) Contact information for borrowers to assert errors. In such circumstances, 1024.41(c)(3) requires the transferee servicer to provide a notice of complete application that discloses the date the transferor servicer received the documents and information constituting the complete application. Comment for 1024.33 - Mortgage Servicing Transfers, Comment for 1024.34 - Timely Escrow Payments and Treatment of Escrow Balances, Comment for 1024.35 - Error Resolution Procedures, Comment for 1024.36 - Requests for Information, Comment for 1024.37 - Force-Placed Insurance. For purposes of paragraph (f)(2) of this section, a borrower who submits a complete loss mitigation application on or before the reasonable date disclosed to the borrower pursuant to paragraph (b)(2)(ii) of this section shall be treated as having done so during the pre-foreclosure review period set forth in paragraph (f)(1) of this section. Reasonable date when no milestones remain. Disclosure of payment amounts that may change. Foreclosure sale re-scheduled. The servicer must still comply with the other requirements of 1024.41 with respect to the incomplete loss mitigation application, including the requirement in 1024.41(b)(2) to review the application to determine if it is complete, the requirement in 1024.41(b)(1) to exercise reasonable diligence in obtaining documents and information to complete a loss mitigation application (see comment 41(b)(1)-4.iii), and the requirement in 1024.41(b)(2)(i)(B) to provide the borrower with written notice that the servicer acknowledges the receipt of the application and has determined that the application is incomplete. Notwithstanding delay in receiving required documents or information from any party other than the borrower or the servicer, 1024.41(c)(1)(i) requires a servicer to complete all possible steps in the process of evaluating a complete loss mitigation application within 30 days of receiving the complete loss mitigation application. The Real Estate Settlement Procedures Act (RESPA) mandates that mortgage lenders, loan servicers, and brokers provide borrowers with particular disclosures about the nature and costs of real estate purchases. The Real Estate Settlement Procedures Act (RESPA) Explained ii. 1. Section 1024.41(c)(3)(i)(D)(1) and (2) sets forth different requirements depending on whether the servicer has made the first notice or filing under applicable law for any judicial or non-judicial foreclosure process at the time the borrower submits a complete loss mitigation application. Information of liens placed on the property with consent of or at the request of the property owner. 1. (iii) Interaction with appeal process. The method of retaining these records must comply with comment 31(c)(1)-1. ii. Official interpretation of 35(g) Requirements not applicable. The asserted error is substantially the same as an error previously asserted by the borrower for which the servicer has previously complied with its obligation to respond pursuant to paragraphs (d) and (e) of this section, unless the borrower provides new and material information to support the asserted error. (i) In general. Loss mitigation options administered by a servicer for an owner or assignee of a mortgage loan other than the owner or assignee of the borrower's mortgage loan are not available to the borrower solely because such options are administered by the servicer. A qualified written request that asserts an error relating to the servicing of a mortgage loan is a notice of error for purposes of this section, and a servicer must comply with all requirements applicable to a notice of error with respect to such qualified written request. Except as provided in 1024.41(c)(3)(ii), 1024.41(c)(3)(i) requires a servicer to provide a written notice every time a loss mitigation application becomes complete. Explore guides to help you plan for big financial goals, Subpart A - General Provisions 1024.11024.5, Subpart B - Mortgage Settlement and Escrow Accounts 1024.61024.20, Subpart C - Mortgage Servicing 1024.301024.41, Supplement I to Part 1024 - Official Interpretations. (3) The loan modification is made available to borrowers experiencing a COVID-19-related hardship. in Supplement I. A servicer must continue to exercise reasonable diligence to obtain documents and information from the borrower that the servicer requires to evaluate the borrower as to all other loss mitigation options available to the borrower. For example, in response to an asserted error regarding payment allocation, a servicer may provide a printed screen-capture showing amounts credited to principal, interest, escrow, or other charges in the servicer's system for the borrower's mortgage loan account. See interpretation of Paragraph 35(e)(1)(i). If a servicer determines that, pursuant to this paragraph (g), the servicer is not required to comply with the requirements of paragraphs (d), (e), and (i) of this section, the servicer shall notify the borrower of its determination in writing not later than five days (excluding legal public holidays, Saturdays, and Sundays) after making such determination. in Supplement I. (2) If a servicer has exercised reasonable diligence to obtain required documents or information from a party other than the borrower or the servicer, but the servicer has been unable to obtain such documents or information for a significant period of time following the 30-day period identified in paragraph (c)(1) of this section, and the servicer, in accordance with applicable requirements established by the owner or assignee of the borrower's mortgage loan, is unable to determine which loss mitigation options, if any, it will offer the borrower without such documents or information, the servicer may deny the application and provide the borrower with a written notice in accordance with paragraph (c)(1)(ii) of this section. Official interpretation of 41(b)(2)(i) Requirements. Subject to paragraphs (e)(2)(ii) and (iii) of this section, if a complete loss mitigation application is received 90 days or more before a foreclosure sale, a servicer may require that a borrower accept or reject an offer of a loss mitigation option no earlier than 14 days after the servicer provides the offer of a loss mitigation option to the borrower. in Supplement I. (i) Requirements. Promptly upon determining that the servicer requires the documents or information to determine which loss mitigation options, if any, the servicer will offer the borrower; and. A transferee servicer may be unable to make a determination on an appeal when, for example, the transferor servicer denied a borrower for a loan modification option that the transferee servicer does not offer or when the transferee servicer receives the mortgage loan through an involuntary transfer and the transferor servicer failed to maintain proper records such that the transferee servicer lacks sufficient information to review the appeal.

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