Filter Results CategoriesCart
Highlight Updates

1.3.3.3.2 Finding out who owns the mortgage

Sometimes it is difficult to determine who is the present owner of a mortgage loan. A mortgage loan may be assigned several times during its term, and may be held by one entity but serviced by another.

Commonly, a servicer acts as the agent for the holder under the express authority delegated to it under a servicing agreement or, in the case of securitized loans, a pooling and servicing agreement. Occasionally, the servicer will refuse to provide information about its principal—the owner and holder of the note and mortgage. The Truth in Lending Act contains a provision that requires loan servicers to tell borrowers who the actual holder of their mortgage really is.25 The servicer is required upon written request to provide the homeowner with the name, address, and telephone number of the owner of the mortgage or the master servicer26 of the mortgage. Unfortunately, there is no time frame specified in the statute by which the servicer need respond. The servicer should respond within a reasonable period of time, not to exceed a few weeks. The remedy for failure to comply has also been problematic. However, an amendment to TILA made by the Helping Families Save Their Homes Act of 2009,27 now states that violations of this notice requirement may be remedied by TILA’s private right of action found in 15 U.S.C. § 1640(a), which includes recovery of actual damages, statutory damages, costs, and attorney fees.28

The Real Estate Settlement Procedures Act provides a similar right to obtain information about the owner of the mortgage.29 The provision requires a servicer to respond within ten business days to a borrower’s request for the identity, address, and other contact information about the owner or assignee of a mortgage loan.30

A 2009 amendment to TILA also added a provision which, if ownership of a mortgage loan is transferred, requires the new owner or assignee to notify the borrower within thirty days after the loan is sold or assigned of its identity, address, telephone number, the date of transfer, and location where the transfer is recorded.31 In addition, the new owner must disclose how the borrower may reach an agent or party with authority to act on behalf of the new owner, and any other relevant information regarding the new owner.32 Failure to comply with these requirements gives rise to a private right of action.33 This provision is examined in detail at § 10.2.6, infra.

Fannie Mae and Freddie Mac have taken steps to enable borrowers to quickly determine whether Fannie Mae or Freddie Mac owns their loan. Borrowers and advocates can either call a toll-free number34 or enter a street address, unit, city, state, and zip code for the property location on a website set up to provide ownership information.35 The website information, however, may in some cases refer to Fannie Mae or Freddie Mac as “owners” when in fact their participation may have been as the party that had initially purchased the loans on the secondary market and later arranged for their securitization and transfer to a trust entity which ultimately holds the loan.

Footnotes

  • 25 {25} 15 U.S.C. § 1641(f). See § 4.3, infra. The provision also should require disclosure to the borrower’s advocate with a properly signed release form. See Appx. J, Form 3, infra.

  • 26 {26} If the borrower is provided with the name and address of the master servicer, a second request under § 1641(f) may be sent to the master servicer to determine the owner of the loan.

  • 27 {27} Pub. Law No. 111-22, tit. IV, § 404, 123 Stat. 1632 (May 20, 2009).

  • 28 {28} See 15 U.S.C. § 1640(a). A written request for identification of the mortgage owner sent to the servicer will also be a “qualified written request” under RESPA, which authorizes a private cause of action for violations. See § 3.2.2, infra.

  • 29 {29} 12 U.S.C. § 2605(k)(1)(D), added by Pub. L. No. 111-203, 124 Stat. 1376, tit. XIV, § 1463(a) (July 21, 2010).

  • 30 {30} See § 3.2.2.10.7, infra.

  • 31 {31} See 15 U.S.C. §§ 1641(g)(1)(A), 1641(g)(1)(B), 1641(g)(1)(D).

  • 32 {32} See 15 U.S.C. §§ 1641(g)(1)(C), 1641(g)(1)(E).

  • 33 {33} See 15 U.S.C. § 1640(a).

  • 34 {34} For Fannie Mae call 1-800-7FANNIE (8:00 a.m. to 8:00 p.m. EST); Freddie Mac call 1-800-FREDDIE (8:00 a.m. to 8:00 p.m. EST).

  • 35 {35} Fannie Mae Loan Lookup, www.fanniemae.com/loanlookup; Freddie Mac Self-Service Lookup, https://ww3.freddiemac.com/corporate.