Bogus Charges Due to Loan Servicer Change?

Many homeowners do not pay their mortgage to the financial institution that gave them the initial loan. Instead, many mortgages are managed by other companies known as mortgage servicers. These companies accept payments, provide notice when a homeowner is in default, and handle other tasks related to the mortgages of homeowners. The same servicer that manages your home loan when you first obtain it may change over time, however. It is not uncommon for mortgages to be sold from company to company.

While financial institutions and mortgage servicers both have the right to sell the loans they own, they must do so responsibly and not infringe on the rights of homeowners. Unfortunately, that does not always happen. If you have experienced problems with your mortgage servicer after your loan was sold, you do have legal options. Below, one of our Florida foreclosure defense lawyers explains more.

Bogus Charges After a Loan Servicer Change

The most common problem after a loan servicer changes is that they charge bogus fees. This is typically because payments to the original or previous loan servicer are not credited properly to your account, or the new servicer does not credit them in a timely manner. This could result in late fees being wrongfully assessed, loan interest not being calculated properly, or a number of other fees being added to your loan balance, even though you did not incur them.

These fees place homeowners at a significant disadvantage. It can place them in a very difficult financial position and even make it difficult for them to pay their mortgage. Homeowners would not be placed in this difficult situation if the new loan servicer had managed their mortgage properly. Homeowners should also not have to face foreclosure or otherwise suffer financial harm due to the mortgage servicer’s mistake or fraudulent activity.

Notice of Loan Service Change

There are many steps to take to protect yourself and your rights if your loan servicer changes. The first is knowing how to determine that your loan servicer has changed. If your mortgage is transferred to another company, you will receive at least one notice, if not two. These notices are intended to inform you that you must make mortgage payments to the new servicer and not the old one.

The servicer that was receiving your payment must provide you with notice at least 15 days before the transfer date becomes effective. The servicer you will start making payments to must send you a notice within 15 days after the date of transfer becomes effective. Sometimes, both of these notices are sent together as one notice. In these cases, the notice must be provided at least 15 days before the transfer date becomes effective.

The notice must contain certain information, including:

• The date the servicing transfer became effective
• The name, address, and phone number of the new servicer, employee, or department, so you can contact them with questions
• The name, address, and phone number of the old servicer, employee, or department so you can contact them with questions
• The date the old servicer will no longer accept payments for your mortgage, and the date the new servicer will begin accepting them
• If the transfer will impact any type of insurance associated with the mortgage
• A statement that the transfer will not impact the conditions or terms of the home loan, other than those related to servicing the mortgage

It is very important to know that federal law allows you to make payments to the old servicer for 60 days after the transfer date. If you pay your mortgage to the old servicer, the new servicer is prohibited from assessing a late fee or reporting your payment as late to the credit reporting bureaus. Unfortunately, many servicers violate this law, thereby infringing on the rights of homeowners.

What to Do if Your Servicer Changes

If you have received notice that your mortgage servicer is changing, there are important steps to take. These include:

• Cancel automatic payments: If you have set up automatic payments for your mortgage with your old servicer, you should cancel them after making your last payment to them. Save the last statement from the previous servicer, as it will verify the outstanding mortgage balance, and the balance for insurance and taxes.
• Review the new servicer’s loan statement carefully: After making your first payment to the new servicer, confirm that the payment has been taken from your bank account and contact the servicer to confirm that they have received it. Also confirm that they have applied the payment properly to your account. Do not set up automatic payments until you have made two payments to the new servicer and keep statements that show the payments were properly applied.

What to Do if You are Charged Bogus Fees

Regardless of how proactive you are when making mortgage payments, the new servicer may still try to charge you bogus fees. When this happens, the first step to take is to contact the servicer. There is a chance that it was an honest mistake. If the servicer is not willing to resolve the issue, you may have to file a formal complaint with a government agency, such as the Consumer Financial Protection Bureau (CFPB).

Lastly, you may have to take legal action if the servicer has violated state or federal law. In these cases, it is important to speak to a Florida foreclosure lawyer. Our experienced attorneys have taken legal action against the following companies:

• Cooper
• RoundPoint Mortgage Servicing
• Ocwen
• Newrez
• Shellpoint
• PHH
• Rushmore
• Select Portfolio

Contact Our Foreclosure Attorneys in Florida Today

If your mortgage has changed services and you are not being treated fairly, you need legal help. At Loan Lawyers, our Florida foreclosure attorneys have the experience to go up against the servicers, fight for your rights, and help you obtain the best possible outcome. Call us now at (954) 523-4357 or contact us online to schedule a free review of your case and to learn more about how we can help.