The responsibility of handling your mortgage can feel like a burdensome task. But knowing your rights can ease the stress and prevent future problems. Your mortgage servicer knows your rights, and you should too!
Here are some of the rights you have when it comes to your mortgage. You have a right to:
Prompt Payment
Your mortgage servicer must make payments on the due date to avoid default charges. However, in case of an error, here’s how you can keep track of your mortgage payment:
Keep and Review Records
Keep and review all records you receive from your mortgage servicer. Review statements or payment books that your servicer delivers to you.
Never discard records, including old ones. Also, save statements, payment books, and documents you send to the servicer. If there’s any issue, you would need them as a reference.
Know the Contact Information of your Servicer
Your payment book should contain your servicer’s contact information. If you get a new servicer, get their contact information before your next payment. This will ensure your payment is processed by the right servicer to avoid delays or scams.
Track Late Statements
If you notice a late statement— even if only a few days late — call your mortgage servicer right away to have it checked. Late payments are tagged as default, and they reflect on your credit report, which can affect your ability to get credit in the future.
Verify your loan balance and account information
If you’re looking to refinance or pay off your loan balance before the end of the mortgage term, you’ll need to verify the payoff amount with the servicer.
Contact your servicer to get your payoff amount as of the specific date you’d like to make the payment.
Raise Concerns and Resolve Errors
If there’s an error or you’re charged a fee you don’t owe, raise your concern with your servicer.
However, keep to your regular payment schedule. Do not deduct the charge from your mortgage payment to avoid problems. Also, never write your dispute in your payment book or include it in your mortgage statement.
Contact your servicer through a formal written request letter detailing the issue and attaching relevant documents that support your claim. Remember to keep a copy of your letter and the originals of the documents attached for evidence.
Know Your Legal Rights
The Real Estate Settlement Procedures Act (RESPA) mandates mortgage servicers to acknowledge request letters within five business days of receipt and to rectify the error within 30 business days.
They must also send a written statement on the action taken to resolve the issue and contact details for more information.
Valid Information
Part of your mortgage servicer’s responsibility is to keep you informed and also answer questions on your mortgage.
You have a right to request an explanation for anything you don’t understand. For example, if your loan servicer changes, you should get a notice.
You Have a 60-Day Grace Period When You Transfer to a New Mortgage Servicer.
This means you can’t be charged a late payment fee if you sent your mortgage payment on time to your old servicer. Also, your new servicer can’t report this as late.
But this also means that you can only change your mortgage lender before the mortgage servicing or repayment begins. However, you can transfer to a new mortgage servicer if you refinance your loan. This lets you switch to a lender that services the loans they give like at LoanDepot.
How to Protect Your Rights
There are several reasons to hire a real estate attorney. Primarily, they help review loan documents, represent you if there’s a problem, and protect your rights, as well as your interests, during the entire mortgage process.