What to do if Mortgage Lender Refuses to Send Monthly Statements Post-Bankruptcy?

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What to do if Mortgage Lender Refuses to Send Monthly Statements Post-Bankruptcy?

Bankruptcy is a trying time for people who are debt-ridden. Even after getting a discharge through bankruptcy, the secured debts and priority debts remain. If a debtor who has a mortgage on their house but didn’t reaffirm the loan during bankruptcy continues making monthly payments towards the loan but does not receive monthly mortgage statements from the lender, can be in trouble.

Since sending periodic statements can be construed as a violation of the automatic stay provision of bankruptcy, there exists a debate over it. The automatic stay prevents creditors to take any collection action and these statements could be a reminder of the dues. According to Dallas based bankruptcy law firm https://bankruptcy.recoverylawgroup.com/, it is not essential for mortgage service providers to give monthly mortgage statements to the debtor, especially after a bankruptcy. However, if you wish to get the same, there are provisions available. Consulting with bankruptcy lawyers at 888-297-6023 can help you with your problems.

Periodic Statement Rule

Since the mortgage crisis often results in the homeowners being relatively clueless about the current information on their mortgage accounts, the Consumer Financial Protection Bureau (CFPB) made changes in some rules. As of January 10, 2014, mortgage creditors need to provide monthly billing statements to the borrower. This includes the amount the debtor has already paid, the amount they owe as well as other relevant information.

However, exceptions to this rule also exist. In case your loan is a fixed rate one and your creditor has provided you a payment coupon nook, monthly statements are not required. Additionally, they are also exempted from sending statements during bankruptcy proceedings. If the debt is discharged during bankruptcy, then there is no need to send monthly statements. Though, some bankruptcy lawyers in Dallas insist on getting monthly statements if the mortgage lien exists. In case the creditor enforces the lien, they should oblige with the periodic statement rule.

Wish the creditor to resume sending periodic statements? Here’s what you should do

Asking the mortgage service provider to resume sending the statements is the first thing. The creditor might oblige or ask you to reopen the bankruptcy case and reaffirm the loan to resume getting monthly statements. However, this is a bad idea as you cannot get rid of the mortgage if you reaffirm it.  Moreover, in many jurisdictions, this might not be approved in courts. Alternately, you could refer to the periodic statement rule to request the mortgage servicer to send monthly mortgage statements.

In case you wish to get information about your account (payment amount or interest rate readjustment schedule) but the mortgage servicer is not cooperative, you can request for the information under the Real Estate Settlement Procedures Act (RESPA). Care must be taken to ask for this request within one year of getting a bankruptcy discharge or when both debt and corresponding lien have ended. The written request must include:

  • Your name
  • The information which helps identify your mortgage loan account
  • Information you wish to know with respect to your mortgage loan

Ensure that your date and sign the letter and send it via certified mail to the designated address of the servicer for proper record of the process.

On receiving your written RESPA request for monthly mortgage statement via registered mail, the servicer needs to provide a written acknowledgment within 5 days and respond within 30 days with the required information. An additional 15 days can be given to the servicer provided they give a notification, in writing, (before the expiration of the original 30-day timeframe) asking for an extension with reasons for it.


    2023-03-07T09:49:17+00:00