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Here's what I tell every borrower who calls me in a panic after getting that servicing transfer letter: Take a deep breath. Your mortgage terms haven't changed, you're not losing your home, and this is completely normal. After more than two decades in mortgage lending, I've walked thousands of homeowners through this exact situation at AmeriSave.
The reality is that mortgage servicing transfers happen all the time in our industry. According to the FDIC, nonbank mortgage companies sold approximately 97% of their originations, while traditional banks sold nearly 50% of theirs. By 2024, independent nonbanks became the sellers for 66% of Fannie Mae and Freddie Mac securitizations and a whopping 84% of Ginnie Mae-backed loans. The secondary mortgage market has grown to over $9.2 trillion as of April 2025, with Fannie Mae holding 38.7% of agency mortgage-backed securities, Freddie Mac at 33.0%, and Ginnie Mae at 28.3%.
Let me be straight with you: lenders sell mortgages to keep money flowing in the system so they can make more loans to more borrowers. It's basic liquidity management. When your lender sells your mortgage or transfers the servicing rights, they're following a business model that's kept the U.S. housing market working for decades. The question isn't whether your mortgage might be sold—it's understanding what that means for you when it happens.
This guide breaks down everything you need to know about mortgage servicing transfers in 2026, from the legal protections you have under RESPA to what actually changes (spoiler: not much) and how to protect yourself during the transition.
When you close on your home loan, you might assume you'll be making payments to that same lender for the next 30 years. In reality, most mortgages change hands multiple times before they're paid off. According to FDIC analysis of 2017 HMDA data, nonbank mortgage companies sold more than 97 percent of their first-lien originations, while traditional banks sold nearly half (approximately 49.9%) of their mortgage originations.
The reason is straightforward business economics. Imagine you're running a mortgage company and you just funded $100 million in loans. That's $100 million tied up for potentially 30 years, earning interest but not available to make new loans. By selling those mortgages to investors—primarily Fannie Mae, Freddie Mac, or Ginnie Mae—you get that $100 million back (plus fees and servicing income) and can immediately originate another $100 million in loans to new home buyers.
The Treasury Department's 2024 Report on Nonbank Mortgage Servicing notes that by 2022, independent nonbank mortgage companies had become the sellers for 66 percent of mortgages in Fannie Mae and Freddie Mac securitizations and the issuers for 84 percent of mortgages in Ginnie Mae securitizations. This represents a dramatic shift from 2008, when independent nonbanks were sellers for only 10 percent of Enterprise securitizations and issuers for just 14 percent of Ginnie Mae securitizations.
At AmeriSave, we work with borrowers to find the best mortgage solution for their situation, and part of that process includes being transparent about servicing. Some lenders specialize in origination but transfer servicing to companies that focus on managing loans long-term. Others retain servicing rights because they value the ongoing customer relationship. Neither model is inherently better or worse—they're just different business approaches in a market that funds over $1.79 trillion in annual mortgage originations as of 2024 projections.
The mortgage industry uses specific terminology that confuses a lot of homeowners, so let me break down the three main entities involved when your loan is sold:
Lender (Originator): This is the company that gave you the money to buy your home. They underwrote your application, approved your loan, and handed you the check at closing. Examples include banks like Wells Fargo, nonbank lenders like AmeriSave or Rocket Mortgage, or credit unions. The lender's name is on your original loan documents.
Servicer: The servicer is the company that handles the day-to-day administration of your mortgage after closing. They collect your monthly payments, manage your escrow account for taxes and insurance, send you annual tax statements, and act as your point of contact for questions. The servicer might be the same company as your lender, or it might be a completely different entity. According to Urban Institute's December 2023 Housing Finance chartbook, the nonbank share of agency loan servicing reached 80 percent in November 2023, with Ginnie Mae's nonbank servicing share consistently higher at 92 percent compared to Fannie Mae (76%) and Freddie Mac (69%).
Investor (Note Holder): The investor is the entity that actually owns your mortgage loan and has legal right to the payments. This is typically Fannie Mae, Freddie Mac, or Ginnie Mae—the three government-sponsored enterprises (GSEs) that purchase mortgages and package them into mortgage-backed securities (MBS). As of April 2025, these three agencies held approximately $9.2 trillion in outstanding MBS, with Fannie Mae at 38.7 percent ($3.6 trillion), Freddie Mac at 33.0 percent ($3.0 trillion), and Ginnie Mae at 28.3 percent ($2.6 trillion) of the agency market.
Here's where it gets interesting: your lender might sell your loan to Fannie Mae (making Fannie the investor) but retain the servicing rights (meaning you still send payments to your original lender). Or your lender might sell both the loan AND the servicing rights to different companies. You could end up with three different entities involved: the original lender who made the loan, the investor who owns it, and the servicer who collects your payments.
The key point? As a borrower, you only interact with the servicer. The investor and the original lender typically operate behind the scenes.
This is the most important section in this entire guide, so let me be absolutely clear: When your mortgage servicing is transferred, the actual terms of your loan do not change. Not one bit.
Your interest rate stays the same. Your monthly payment stays the same. Your loan balance stays the same. Your maturity date stays the same. If you had a 30-year fixed-rate mortgage at 6.5% with 27 years remaining, you still have a 30-year fixed-rate mortgage at 6.5% with 27 years remaining after the transfer.
According to 12 CFR § 1024.33(b)(2)(vi), the notice of transfer must include "a statement that the transfer of servicing does not affect any term or condition of the mortgage loan other than terms directly related to the servicing of the loan." This is federal law protecting consumers from having their loan terms altered through servicing transfers.
The ONLY things that change are administrative:
Where you send your payment: You'll get new payment instructions with account numbers, mailing addresses, or online payment portal information for the new servicer.
Who to contact with questions: You'll receive new customer service phone numbers and possibly email addresses or online chat systems.
Escrow account management: Your escrow account (if you have one) transfers to the new servicer with the full balance. The new servicer must honor your existing escrow arrangements. You do not need to make additional deposits or restart escrow.
Statement format: Your monthly statements might look different—new logo, different layout, possibly different due dates if you're on auto-pay. But the underlying payment amount remains identical.
Optional insurance arrangements: The only potential complication involves optional products like mortgage life insurance or disability insurance. The transfer notice must disclose "whether the transfer will affect the terms or the continued availability of mortgage life or disability insurance, or any other type of optional insurance, and any action the borrower must take to maintain such coverage."
That's it. Your mortgage is still your mortgage, just with a new administrator. At AmeriSave, when we explain this to concerned borrowers, I tell them it's like switching accountants—the numbers in your business don't change, just who's preparing the reports.
The Real Estate Settlement Procedures Act (RESPA) provides strong consumer protections specifically designed to make servicing transfers as smooth as possible. Understanding these protections helps you know your rights and what to do if something goes wrong.
15-Day Advance Notice Requirement: Under 12 U.S.C. § 2605(c)(2)(A), your current servicer must notify you in writing at least 15 days before the effective date of the servicing transfer. The notice must include the transfer effective date, the name and contact information of the new servicer, toll-free phone numbers for both the old and new servicers to answer questions, and disclosure about any impact on optional insurance coverage.
New Servicer 15-Day Notice: The new servicer must also send you a notice, but they have up to 15 days AFTER the transfer effective date to do so under 12 U.S.C. § 2605(c)(3). Many servicers send a joint notice to satisfy both requirements.
60-Day Payment Grace Period: This is your most important protection. According to 12 CFR § 1024.33(c)(1), during the 60-day period following the effective date of transfer, "a loan payment received by your old servicer before its due date may not be treated by the new loan servicer as late, and a late fee may not be imposed on you." This means if you accidentally send your payment to the wrong servicer during the transition, you're protected from late charges.
The old servicer must "promptly" either transfer the misdirected payment to the new servicer for proper application, or return the payment to you with notification of the proper payment recipient. Rocket Mortgage's January 2025 servicing transfer guidance emphasizes this protection, noting that servicers have extensive experience handling these temporary payment confusions.
Qualified Written Request Rights: Under 12 U.S.C. § 2605(e), you can send a qualified written request (QWR) to your servicer if you believe there's an error with your account, need information about your loan, or have questions about the servicing transfer. The servicer must acknowledge your QWR within 5 business days and provide a substantive response within 30 business days (with possible 15-day extension).
Error Resolution Requirements: If your servicer makes an error related to the transfer—for example, misapplying a payment, incorrectly reporting escrow balances, or failing to credit payments properly—RESPA requires them to correct the error and provide written confirmation of the correction.
Damages for Violations: According to 12 U.S.C. § 2605(f), if a servicer violates RESPA requirements, you may be entitled to actual damages plus up to $2,000 in statutory damages for a pattern or practice of noncompliance. In class action cases, additional damages can be awarded. While you hope never to need this provision, it's powerful leverage ensuring servicers take transfer requirements seriously.
The Consumer Financial Protection Bureau's regulations at 12 CFR § 1024.33 expand on these protections with specific technical requirements for notice format, timing exceptions for business emergencies, and procedural rules servicers must follow.
To really understand why servicing transfers happen so frequently, you need to understand the secondary mortgage market—the system where mortgages are bought and sold after origination.
When you get a mortgage, that happens in the primary market. You apply, get approved, close, and receive funds. This is direct lending between you and your lender.
The secondary market is where lenders sell those mortgages to investors. According to FDIC's 2019 quarterly analysis, in aggregate during 2017, nonbanks sold 34.1 percent of their mortgages to the GSEs (Fannie/Freddie), 20.8 percent into Ginnie Mae securitizations, and 42.7 percent to other entities. Traditional banks had a different mix: 27.2 percent to GSEs, 7.2 percent to Ginnie Mae, and 19.0 percent to other entities.
This secondary market system serves crucial economic functions:
Liquidity Creation: By purchasing mortgages from originators, Fannie Mae, Freddie Mac, and Ginnie Mae free up capital so lenders can make more loans. Without this system, mortgage lending would be limited to how much capital each individual lender has on their balance sheet.
Risk Distribution: When mortgages are packaged into mortgage-backed securities (MBS) and sold to investors worldwide, the risk of default is spread across thousands of investors rather than concentrated at individual lenders. This makes the overall system more stable.
Geographic Capital Flow: The secondary market allows capital from investors in New York or California to fund mortgages in Ohio or Texas. Money flows to where housing demand exists, regardless of local deposit levels at banks.
Standardization: To participate in the secondary market, loans must meet specific underwriting standards set by Fannie Mae, Freddie Mac, or FHA/VA (for Ginnie Mae loans). This creates nationwide consistency in mortgage products and protections for borrowers.
The Congressional Research Service's 2017 overview noted that of all first-lien originations in Q1 2019, 37.3 percent were portfolio originations (not securitized), 39.6 percent were securitized by the GSEs, 20.2 percent were sold into Ginnie Mae securitizations, and only 2.9 percent went into private-label MBS (compared to much higher pre-crisis levels).
Recent Ginnie Mae Global Markets Analysis Reports show the agency market continuing to evolve. In January 2025, total gross MBS issuance was approximately $98.7 billion, with Ginnie Mae issuing $38.1 billion compared to Freddie Mac's $32.9 billion and Fannie Mae's $27.7 billion. This represents Ginnie Mae's growing market leadership in recent years.
From a borrower's perspective, this system works remarkably well. You get access to low, fixed-rate mortgages that would be impossible without the liquidity and standardization the secondary market provides. The tradeoff is that your loan will likely be sold and your servicer may change, but your actual mortgage terms remain protected by federal law.
The loan servicing market is experiencing significant growth. According to The Business Research Company's 2025 Loan Servicing Global Market Report, the market has grown rapidly from $2.51 billion in 2024 to $2.92 billion in 2025 at a compound annual growth rate of 16.2 percent. Projections show continued rapid growth to $5.38 billion by 2029 at a 16.5 percent CAGR.
Several trends are driving increased servicing transfer activity in 2026:
Market Consolidation: Larger servicers are acquiring portfolios from smaller companies. HousingWire's August 2024 analysis highlighted Mr. Cooper's acquisition of Flagstar's servicing portfolio, which added approximately $132 billion in mortgages at 6% or higher interest rates. Mr. Cooper's total mortgage servicing rights (MSRs) reached $676 billion by mid-2024, an increase of 70 percent over two years, making them the fourth-largest MSR holder. Rocket acquired Mr. Cooper last year and now they service 1 in every 5 mortgages in the U.S.
Strategic MSR Sales: Companies facing financial pressure or seeking to optimize their balance sheets are selling servicing rights. LoanDepot sold a significant portion of its MSRs from low-coupon 2020-2021 vintage loans, with its owned servicing portfolio declining 26 percent over two years to $114 billion in unpaid principal balance as of June 2024.
Interest Rate Environment: When rates rise dramatically (as they did in 2022-2024), mortgage companies face a strategic choice about their servicing portfolios. Rising rates typically slow prepayments, increase MSR fair value, and enable companies to earn more interest on escrow accounts. Companies like Freedom Mortgage have been actively purchasing MSRs from "different people that need to raise cash for operations, or just to get into some stability or just to take some risk off the table," according to CEO Stanley Middleman.
Regulatory Changes: The implementation of Basel III Endgame capital rules (effective July 2025) requires banks with over $100 billion in assets to hold more capital, which may force some to reduce their mortgage platforms and sell servicing portfolios. Baker Tilly's January 2025 industry outlook noted these new requirements propose a loan-to-value risk-weighted approach that increases capital required to hold loans on balance sheets.
Technology Investment: Large servicers with sophisticated technology platforms can manage portfolios more efficiently than smaller servicers. This creates economies of scale that encourage consolidation and portfolio transfers.
Nonbank Servicer Growth: The dramatic shift toward nonbank servicers continues. The Treasury Department's 2024 Report on Nonbank Mortgage Servicing documented that independent nonbank mortgage companies (NMCs) grew from servicing almost nothing pre-2008 to being the sellers for 66 percent of Enterprise securitizations and issuers for 84 percent of Ginnie Mae securitizations by 2022. Six NMCs each serviced Agency portfolios in excess of $6 trillion as of 2023.
For you as a homeowner, this means servicing transfers may become even more common in the coming years. The good news is that the process is well-established, heavily regulated, and thousands of transfers happen successfully every month. At AmeriSave, we prepare our clients for the possibility of servicing transfers upfront, so they know what to expect if it happens.
While RESPA provides strong legal protections, being proactive during a servicing transfer makes the process smoother and reduces the chance of problems. Here's exactly what to do:
Before the Transfer (When You Receive Notice):
Read both notices carefully—the one from your current servicer and the one from your new servicer. Verify that basic loan information (loan number, property address, current balance) matches your records. Note the exact effective date of the transfer—this is when you should start sending payments to the new servicer.
Set up your account with the new servicer immediately, even before the transfer date. Most servicers now offer online account access, and creating your login early prevents last-minute scrambles. If you use online bill pay through your bank, update the payment recipient information in your banking system. Be careful here—if your bank sends a paper check to your old servicer after the transfer date, it can take extra time to get properly credited.
Document everything. Save copies of both transfer notices in your permanent mortgage file. Take screenshots if you receive electronic notices. These documents may be important if any issues arise.
During the 60-Day Transition Period:
Make your first payment to the new servicer on or slightly after the effective transfer date. Don't send it too early, as this can cause confusion. And of course, don’t send the payment late or skip a payment. Monitor your account closely to ensure the payment is properly credited. Rocket Mortgage's January 2025 guidance emphasizes checking that payments are applied correctly- ideally verify at least two payment cycles.
Keep your old servicer's contact information handy. If something goes wrong (payment not credited, escrow issues, missing documentation), you may need to contact both servicers to resolve the problem.
Review your escrow account transfer carefully. The new servicer must transfer the full escrow balance from your old servicer. Your annual escrow analysis should show the correct starting balance. If there's a shortage or surplus, it should match what your old servicer reported.
Verify that automatic payments continue correctly. If you had auto-pay set up with your old servicer, that authorization typically does NOT transfer automatically. You'll need to set up new auto-pay with the new servicer. Some borrowers prefer to skip one auto-pay cycle and make manual payments while confirming everything is working correctly, then restart auto-pay once they're confident.
After the Transfer:
Check your credit reports after 60-90 days to ensure the old servicer reported the transfer correctly and the new servicer is reporting accurately. Late payments mistakenly reported during transfer periods can damage your credit score, and you want to catch and dispute these quickly.
Maintain records of all payments during the transition. Keep bank statements, canceled checks, or electronic payment confirmations showing you paid on time and to the correct entity. If disputes arise later, this documentation proves payment history.
Update your insurance company and property tax authority if needed. While the servicer typically handles communications with these entities regarding escrow, some jurisdictions require direct notification of servicing changes.
Send a qualified written request (QWR) if something seems wrong. Don't wait and hope errors fix themselves. Under RESPA, the servicer must respond within specific timeframes, and the sooner you identify issues, the sooner they can be resolved.
At AmeriSave, we've handled thousands of servicing transfers over the years, and I can tell you that the vast majority happen without any issues. The borrower gets the notices, updates their payment information, and everything continues smoothly. But knowing how to protect yourself gives you peace of mind and helps you handle the occasional exception effectively.
After more than two decades in the mortgage industry, I've seen this scenario play out thousands of times: A homeowner receives a servicing transfer notice, panics thinking something is wrong with their loan, calls us at AmeriSave, and we walk them through why this is completely normal and nothing to worry about.
Mortgage servicing transfers are a fundamental part of how the U.S. mortgage market works. With nonbank mortgage companies now originating 80 percent of agency loans and servicing over $9.2 trillion in mortgage-backed securities across Fannie Mae, Freddie Mac, and Ginnie Mae, the secondary market system keeps capital flowing so lenders can make new loans to new home buyers. Your mortgage terms never change during a transfer—same interest rate, same payment, same loan balance, same maturity date.
You have strong legal protections under RESPA, including mandatory 15-day advance notice, 60-day payment grace periods, error resolution rights, and potential damages for servicer violations. The loan servicing market is growing rapidly (projected $5.38 billion by 2029), so transfers may become even more common, but the process is well-established and heavily regulated.
The key is being proactive: read your transfer notices carefully, set up your new servicer account immediately, verify escrow transfers, monitor payments for at least two cycles, and keep documentation of everything. If problems arise, use your qualified written request rights under RESPA to force timely servicer responses.
Remember, your mortgage servicer is just the administrator of your loan, not the owner. Whether you're sending payments to your original lender or to the fifth servicer since closing, what matters is that your payments are credited correctly and your loan continues progressing toward payoff. At AmeriSave, we prepare our borrowers for this possibility upfront so they know exactly what to expect.
Don't let a servicing transfer letter cause unnecessary stress. Understand that it's a normal business transaction that happens to keep the mortgage market liquid and functioning. Your home isn't at risk, your loan terms aren't changing, and you're protected by federal law. Just update your payment information and keep making your regular payments on time.
No, not at all. This is the most common question I get from borrowers, and I want to be very clear: your interest rate is set in stone in your promissory note, which is the legal agreement between you and your lender. The terms of that contract stay the same even when servicing changes. Federal law under 12 CFR § 1024.33 says that "the transfer of servicing does not affect any term or condition of the mortgage loan other than terms directly related to the servicing of the loan." This means that if your interest rate was 6.5% before the transfer, it is still 6.5% after the transfer. The amount you pay each month stays the same. Your loan balance doesn't change. The length of time you have left stays the same. The only thing that changes is where you send your money and who you call if you have questions. At AmeriSave, we stress this point during the origination process so borrowers know that servicing transfers are just administrative changes that don't change the terms of their mortgage. If a new servicer tried to change your rate or payment amount, they would be breaking the law, and you would have a strong case to fight it right away.
Sorry, no. As a borrower, you don't have the legal right to stop or refuse a servicing transfer. When you close on your mortgage, the documents you sign usually say that the lender can sell or transfer your loan and its servicing at any time without your permission. This is common in the industry and gives lenders the freedom to manage their portfolios based on what their businesses need. The servicing transfer is a business deal between your current servicer and the new servicer (or between the lender and an investor), and borrowers are not involved in that deal. But RESPA gives you a lot of protections to make sure the transfer goes smoothly, like required advance notice, payment grace periods, and the right to fix mistakes. You can't stop the transfer, but you can control how you react to it by setting up your new servicer account right away, carefully checking the information, and keeping records of everything. Some people who borrow money want to know if they can refinance to get a different servicer. However, changing who manages your account is usually not a good financial move. It costs a lot of money to refinance, and it could change the length of your loan, so it's not worth it just to choose a servicer. It's better to know that servicing transfers are normal, your loan terms are safe, and the process is heavily regulated to protect consumers.
The full balance of your escrow account will automatically move to the new servicer. The transferring servicer must give an accurate account of your escrow funds and send them to the new servicer under RESPA. You don't have to make new deposits into your escrow account or "restart" it. The new servicer must follow the terms of your current escrow, including when you pay your property taxes and homeowners insurance. Your new servicer has to send you an initial escrow statement within 60 days of the transfer. This statement should show the opening balance transferred from your old servicer, the projected annual costs (taxes and insurance), and the monthly escrow portion of your payment going forward. This statement should be the same as what your old servicer said. If there is a difference, like if the opening balance on your new servicer's statement is lower than the closing balance on your old servicer's statement, you should get in touch with both servicers right away and show them proof of the correct escrow balance. If you need to, send a qualified written request (QWR) to force an official investigation. The new servicer will keep making your property tax and insurance payments on time, but they might call your tax authority and insurance company to change how you make your payments. After 60 to 90 days, you should check with your insurance company and local tax office to make sure that payments are being received correctly. If you had too much or too little money in escrow with your old servicer, the same thing will happen with your new servicer. This should be looked at in your annual escrow analysis, just like it was before. We've seen thousands of escrow transfers go off without a hitch at AmeriSave, but we always tell borrowers to double-check that the opening balance on the new servicer's first escrow statement matches what they have on file.
From an administrative point of view, the "effective date of transfer" happens right away. That's the day when the new servicer takes over the legal responsibility for servicing your loan from the old servicer. But when you include the advance notice, the transfer date, and the post-transfer monitoring period, the whole process takes about 60 to 75 days from start to finish. Here's how it usually goes: On Day 1–15, your current servicer lets you know at least 15 days before the transfer date that it will happen. Some servicers let you know 30 to 45 days ahead of time. Day 15–16 (Transfer Date): The transfer actually happens. The new servicer is now officially in charge of your loan. Payments made on or after this date should go to the new servicer. Day 16–30: The new servicer will let you know within 15 days of the transfer. Some servicers send separate notices, but many send a single notice that meets the requirements for both the old and new servicer. Day 30–75: You have 60 days to make your payment. During this time, if you send a payment to the wrong servicer by mistake, you won't have to pay any late fees while they figure out what to do with the payment. You should also keep an eye on at least two full payment cycles during this time to make sure everything is working right. After Day 75, you're completely settled in and can treat the new servicer like any other servicer. The grace period is over, and you should be sure that the transfer went through. In real life, most borrowers spend about 30 to 45 minutes actively working on a servicing transfer. This includes reading notices, setting up a new online account, updating their auto-pay or bill pay information, and checking the first few payments. It's not hard or time-consuming; it just requires paying close attention to the details.
In most cases, a properly done servicing transfer should not affect your credit score at all. Your payment history stays the same, and as long as you keep paying on time, your credit score shouldn't change. However, there are times when problems with servicing transfers could hurt your credit. For example, if a payment is sent to the wrong servicer during the transition and isn't properly forwarded or credited, it could be reported as late. This is why RESPA's 60-day grace period is so important: it stops late fees and gives servicers time to fix payments that were sent to the wrong place. If a late payment is reported incorrectly during a servicing transfer, you should immediately dispute it with both the old and new servicers and the credit bureaus (Experian, Equifax, and TransUnion). Write down that you paid on time and that any delays were because of the transfer, not because you were late. Missing Payment History: Sometimes, when you switch servicers, it can take a while for the new servicer to report your payment history to the credit bureaus. This can cause the information to be incomplete for a short time. This usually goes away in 30 to 60 days when the systems sync up. Some borrowers say that they temporarily see the same mortgage on their credit report twice—once from the old servicer and once from the new servicer. This usually fixes itself within one or two billing cycles, but you should keep an eye on your reports and dispute any duplicates that stay there for more than 60 days. To keep your credit safe during a servicing transfer, pay all your bills on time, keep records of everything, check your credit reports 60 to 90 days after the transfer to find any mistakes early, and send qualified written requests to servicers if you see any problems. As of Q2 2025, the Federal Reserve reported that only 0.82 percent of people were seriously delinquent (90 or more days past due), and most of those were not due to servicing transfers. Transfers that are handled correctly shouldn't have any effect on your credit.
If your payment goes missing during a servicing transfer, don't panic. You're protected by federal law, and there is a clear way to fix this. First, check to see if you sent the payment to the right servicer on the right date. If you sent it to your old servicer after the effective transfer date, they must either "promptly transfer the payment to the transferee servicer for application to a borrower's mortgage loan account" or "return the payment to the person that made the payment and notify such person of the proper recipient." You can't be charged late fees for payments that were sent to the wrong place during the 60-day grace period. Next, get your payment proof together. This could be images of canceled checks from your bank, electronic payment confirmation numbers, a bank statement showing the debit, or a receipt if you paid by money order. This shows that you paid on time and sent the money to the right person. Get in touch with both your old and new servicer. Tell them that you paid [amount] on [date] and that it hasn't been properly credited to your account. Please give your loan number, the address of the property, and proof of payment. Tell both servicers to look into the payment. If you don't find the payment within 3 to 5 business days, send a qualified written request (QWR) to both servicers by certified mail to move things along. The QWR should say, "I am writing to let you know that there is a mistake with my mortgage account [account number]. I sent a payment of [amount] to [old/new servicer name] on [date]. As of [current date], this payment has not been credited to my account. I am asking you to: (1) look into this missing payment, (2) find it and credit it to my account, (3) send me written confirmation that my account shows no late payments during the servicing transfer period, and (4) confirm that no late fees were charged." Under RESPA, the servicer must acknowledge your QWR within 5 business days and give you a full response within 30 business days. In the meantime, do NOT skip your next monthly payment. Keep making payments on time. If you stopped paying because one payment went missing, you could really get into trouble with your payments. At AmeriSave, we've helped dozens of borrowers who missed a payment. Almost all of them are able to work things out within 14 days once both servicers start talking to each other and tracking the payment through their systems.
Servicing transfers can happen at any time of year, but there are certain times of year when they happen more often because of the way the mortgage industry works. There is often more transfer activity at the end of the year (Q4) because companies are closing deals to buy portfolios and restructuring their balance sheets. The end of the calendar year is also when many service providers finish making their plans for the next year, which may include buying or selling servicing portfolios. In the first quarter (Q1), companies usually make transfers to carry out strategic decisions they made in the fourth quarter (Q4). The transfer of new servicing portfolios bought at the end of the year usually happens in January, February, or March, after all the legal and operational details have been worked out. Transfers tend to be quieter in the middle of the year (Q2–Q3), but deals still happen. Companies are focusing on managing their current portfolios and getting ready for the busy fall origination season. Changes in interest rates have a bigger effect on transfer activity than any set calendar schedule. Companies that are having trouble with cash flow may need to sell servicing to raise money when rates go up quickly, like they did from 2022 to 2024. When rates go down, the number of refinances goes up, and different companies may focus on handling refinances instead of portfolio loans. HousingWire's August 2024 report said that the time of quickly rising rates caused a big MSR repositioning as companies had to choose whether to keep or sell their portfolios based on new prepayment assumptions and fair value calculations. When the market is unstable (like during the 2008 financial crisis or the COVID-19 pandemic), companies go out of business, merge, or restructure, which leads to waves of servicing transfers. The Treasury's 2024 Nonbank Servicing report showed that a lot of servicing moved from traditional banks to nonbank servicers after 2008. From the borrower's point of view, the timing doesn't matter much. You could get a transfer notice in January or July, but the process and your protections are the same. AmeriSave tells borrowers that if they are going to have to switch services, it could happen in the summer or the winter. Being ready and knowing what to do when that notice comes is what matters.
When servicing transfers, your payment due date should usually stay the same. However, there are times when it might change. If the transfer happens in the middle of a billing cycle, the first payment to your new servicer may be due on a different date. However, your monthly due date (for example, the first of each month) usually stays the same. If your new servicer wants to change your due date on a regular basis, they should let you know ahead of time and get your permission. Some servicers have rules about when payments are due. For example, they might process all loans on the 1st and 15th of the month and ask if you want to change to one of those dates. You don't have to agree to a change in the due date, but it might be worth it if it works better with your pay schedule. If a change in the due date makes things harder for you (for example, you get paid on the 30th of each month but the new date is the 1st, giving you only one day to process the payment), tell your new servicer and ask them to keep your original due date. Most servicers will do what you ask if it's reasonable. Pay close attention to your first statement from the new servicer. It should be clear when your payment is due. If it's not what you expected, call the servicer right away to get more information. Don't think the change was planned; it could be a mistake in the system that needs to be fixed. If you have auto-pay and the due date changes, it can be a problem if your automatic payment is set to go out on the old date but the new servicer wants it on a different date. This is another reason to double-check due dates with your new servicer and change the timing of your auto-pay if needed. We at AmeriSave suggest that borrowers check three things with their new servicer: (1) Is the amount of my monthly payment the same? (2) Is my due date still the same? (3) Is there a grace period before late fees, and is it the same as it was with my previous servicer? These three pieces of information make sure that you can keep up with your payments without any problems.
You have a lot of options for escalating a complaint or disagreement with your new servicer, and you are well protected by the law. Start by talking directly to the customer service department of the servicer. You can fix a lot of problems at this level, like system errors, wrong information in your account, questions about how escrow works, or getting more information about policies. If customer service can't help you, ask to talk to a manager or supervisor. Get the name of the person who is handling your complaint and a case number. Keep track of the date, time, and content of every conversation. If talking to someone directly doesn't work, you can file a formal qualified written request (QWR) under RESPA. Send your complaint in writing to the servicer's official address by certified mail. You can find this address in your servicing transfer notice or on their website. In your QWR, include: (1) your loan number and property address, (2) the exact problem or mistake you're disagreeing with, (3) any relevant account history or paperwork, (4) what you want the servicer to do to fix the problem, and (5) your contact information. According to 12 U.S.C. § 2605(e), the servicer has to respond to your QWR within 5 business days and give you a full answer within 30 business days. If they let you know about the delay and the reasons for it, they can get an extra 15 days. The answer must either fix the mistake, explain why they think the account is correct, or give you the information you asked for. You can take legal action if the servicer doesn't respond properly to your QWR. If you break RESPA rules, you could have to pay actual damages and up to $2,000 in statutory damages. Keep records of everything, including all emails, account statements, payment confirmations, and notes from phone calls. You can also file complaints with regulatory agencies besides RESPA. The Consumer Financial Protection Bureau (CFPB) at takes care of servicer complaints and sends them to the company for a response. Your state's attorney general or department of financial regulation may be in charge of mortgage servicers. The Federal Housing Finance Agency (FHFA) is in charge of Fannie Mae and Freddie Mac. It will look into complaints about loans serviced through those programs. We sometimes hear from borrowers who are unhappy with their new servicer (not us, but wherever their loan ended up). We always tell them to use the formal complaint process instead of just calling customer service over and over again. Written QWRs start legal duties and deadlines that phone calls don't.
If you're having trouble paying your bills, a servicing transfer can make it harder to get a loan modification, but it shouldn't stop you from getting help if you qualify. The most important thing is to know your rights and talk to the right servicer at the right time. If you were already working with your old servicer on a loan modification or another way to reduce your losses when the transfer happens, that doesn't mean your modification application is automatically canceled. According to federal rules (especially for GSE and FHA loans), your modification file and status should go to the new servicer. But in real life, things are more complicated than policy. If the transfer happens in the middle of the application process, your new servicer may need you to send in more paperwork. Their underwriting standards or modification programs may be different from those of your old servicer. Some borrowers say that servicing transfers slowed down their modifications by 30 to 60 days while the new servicers looked over their files. To stay safe while applying for a modification and transferring your servicing, get in touch with your new servicer right away when you get the transfer notice. Tell them you have an application for a change pending and ask what papers they need. Don't wait for them to get in touch with you. Ask your new servicer for a direct phone number and case number for your modification. Customer service lines in general may not be able to see loss mitigation files. Keep paying what you can while the transfer is going on. Even if you have a new servicer, you must follow the trial modification plan exactly as you agreed. After the transfer date, send payments to the new servicer. Even if you already sent your hardship documents (like pay stubs, bank statements, a hardship letter, tax returns, etc.) to your old servicer, you need to send them again to the new servicer. Sometimes systems don't work perfectly, and you don't want to wait because documents got lost. Check in once a week. CFPB rules say that modifications have strict deadlines. Servicers can't foreclose while a modification application is still being processed. But you need to make sure that your application stays "complete" with the new servicer. If the new servicer turns down your modification when the old one seemed likely to approve it, ask why. Get the denial in writing and make sure it includes specific reasons. You might be able to appeal or reapply with more paperwork. You might want to get in touch with a HUD-approved housing counselor. You can find one at . These counselors are experts at modifications and can help you deal with servicers for free. They're especially useful when communication gets hard during servicing transfers. We at AmeriSave think that every homeowner who is truly struggling should have a fair chance at modification. Servicing transfers make an already stressful situation even more complicated, but the underlying modification programs (HAMP, Flex Modification, etc.) keep going no matter which company is servicing your loan.
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