Most loans, including mortgaged loans (or mortgages) can be bought and sold. Home loans are often “serviced” by a company that has been hired by the lender to collect payments for the lender from the borrower. Such companies are often known as “loan servicers” or more simply as “servicers.” Federal law requires certain loan servicers to provide notice to borrowers when a borrower’s loan is bought or sold. This notice requirement also applies when the lender hires a new company to “service” the loan. When certain loans are bought or sold, or when the servicing of such loans is transferred to a new servicer, the servicer who transfers such loan must provide notice of the sale or transfer to the borrower at least 15 days before the loan is sold. Such notice must contain the name, address, and toll-free number of the new lender or servicer. In addition, many times the new servicer must also provide a notice to borrowers that the loan has been sold or the servicing has been transferred.
Even though Federal law requires that two notices be provided to certain borrowers when their loan is sold or when the servicing is transferred, it’s possible that borrowers could still be uncertain as to who their actual lender is. Borrowers could become confused if they receive multiple notices after their loan is sold multiples times. Some borrowers may have incomplete paperwork if the notices they received from their lenders are lost or destroyed. Also, borrowers may not know who their actual lender is if such borrowers receive notice from loan servicers when the loan servicing is being transferred. (Loan “servicing” occurs when a lender hires a different company to collect payments as they become due and to otherwise communicate with the borrower about their loan.) Since borrowers are entitled to receive notice when their loan servicing is transferred, it would be possible for borrowers to be uncertain whether or not their loan “servicer” is also the owner of their loan.
Fortunately, Congress has provided a method for borrowers to obtain information from a loan servicer as to the identity of a borrower’s lender. Federal law obligates certain loan servicers to respond to requests for information from borrowers. Borrowers can send their servicer a “Qualified Written Request” which obligates such servicers to acknowledge this request within 20 days and to then to fully respond to the request within 60 days (Holidays and weekends are not counted in the calculation of these time periods, so the servicer’s response is not due in 60 calendar days – it’s 60 business days). Servicers are only required to respond to a “Qualified Written Request,” which consists of a written request that is not made on a payment stub, coupon, or other payment item supplied by the servicer. A “Qualified Written Request” must enable the servicer to identify the borrower’s name and account, and must include a statement of the reasons for the borrower’s belief that the account has an error, or the request must describe the other information requested by the borrower. The law that provides for these items is located at 12 United States Code section 2605(e).
What does this all mean? If a borrower receives a payment coupon from a loan servicer, and if the borrower writes on the coupon something like “Who owns this loan?” or “Did you give me credit for my last payment?” and then mails the coupon back to the servicer, then this question is not a “Qualified Written Request” because the request was made on a payment coupon supplied by the lender. However, if the borrower wrote those questions in a separate letter, then such a letter may constitute a “Qualified Written Request.” Persons seeking details about making a Qualified Written Request should contact an appropriate legal professional.
The Federal Trade Commission (“FTC”) indicates at its website that it protects “America’s Consumers.” The FTC’s web address for certain mortgage loan information is located at