QUESTION
Are mortgage companies required to send you a notice of a payment increase (with amount) prior to doing so and a time frame for that to occur?
Asked on May 05th, 2023 on Debtor and Creditor - Michigan
More details to this question:
I got behind in my mortgage due to job loss. As I was starting to catch up they increased my rate twice. I got back on track with my original payment amount but they're saying I'm behind and continue to accrue additional daily interest. I never received any notice that my payment was going to go up due to the increase in interest rate. I do not get paper statements. I received an email and letter of the interest rate increases but nothing with updated payment information.
1 ANSWER
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These are RESPA violations.
They are REQUIRED to send statements. They are REQUIRED to send Notices of rate increases.
"The creditor, assignee, or servicer of an adjustable-rate mortgage shall provide consumers with disclosures, as described in this paragraph (c), in connection with the adjustment of interest rates pursuant to the loan contract that results in a corresponding adjustment to the payment. To the extent that other provisions of this subpart C govern the disclosures required by this paragraph (c), those provisions apply to assignees and servicers as well as to creditors."
They are the Creditor or Servicer.
Under 12 CFR § 1026.20(c), they are REQUIRED to serve notice.
This does not prevent them collection activities. But if they report you as late or behind, it hurts your credit score.
You might need legal help on this. You can reach out to the State Bar Lawyer referral service or contact me 248 353 5555.
Answered on May 07th, 2023 at 10:53 AM