Common Servicing Failures

Mortgage servicers don’t own your loan; they are paid to manage the plumbing of your account. When that plumbing breaks, it usually happens in one of these ways:

• Payment MisapplicationYour check was received on time but held in a “suspense account” instead of being applied to your principal and interest.
• Escrow AbuseThe servicer fails to pay your property taxes or insurance, then charges you for force-placed insurance at quadruple the market rate.
• The Transfer Black HoleYour loan was sold to a new company, and your previous trial loan modification or payment history vanished during the hand-off.
• Dual TrackingYou are actively working on a loan modification, yet the servicer is simultaneously moving forward with a foreclosure sale in violation of federal law.
• Rule 3002.1 FailuresIf you are in a Chapter 13 bankruptcy, your servicer is failing to properly disclose fees or acknowledge payments made through the Trustee.

The Technical Framework: RESPA & Reg X

We litigate these cases using the Bureau of Consumer Financial Protection’s mortgage servicing rules. We don’t just call and complain. We send a formal Notice of Error that triggers the servicer’s mandatory duty to conduct a reasonable investigation. If they rubber stamp their denial, they have committed a separate federal violation that we can take to court.