Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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When a servicer transfer your Loan to other servicer, , do I have an opportunity in this situation to challenge the whole loan?.

I mean, can I contest the validity of the loan in a 30 day window?

Because I just received a letter telling me about my loan transfer, I will wait for the letter from the servicer the loan was transfered to,  I will contest the whole loan and request the production of documents

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William A. Roper, Jr.
Generally speaking, under the law the owner and holder of a valid promissory note can delegrate the servicing to whomever the owner chooses.  This is a matter of basic agency law.  The owner is the principal and the servicer in this instance is the agent.  The servicer is simply performing collection services for the owner of the loan.

This basic legal principal is usually displaced by agreement.

The traditional FNMA/FHLMC loan sale paradigm, which has been largely emulated by the Wall Street mortgage trusts, involves the sale of loans originated by firms with so-called seller-servicers agreements (or the exchange of these loans for mortgage backed securities), with the mortgage investor (FNMA/FHLMC) purchasing the loan, but the seller retaining the loan servicing.

The servicer is compensated for servicing the loan using a so called "servicing spread".  The borrower pays the gross note rate required by the promissory note.  With the sale of the loan to the mortgage investor, the originator agrees to pass through to the investor the agreed net note rate together with the borrower's principal payments.  The servicer then retains the difference between the gross note rate and the net note rate.

For example, suppose that an originating lender originates a loan with a fixed 5.5% gross note rate.  Further suppose that the originating lender sells the loan to FNMA or FHLMC with a net note rate of 5%.  In this case, the servicing spread or servicing premium would be 0.5% (5.5% - 5.0%).  The servicer would retain this amount from the monthly payment as compensation for servicing the loan.

On a $100,000 mortgage, it is easy to see that the servicer receives almost $500 for collecting the monthly payments and remitting these to the mortgage investor.

Because the servicing spreads well exceed the actual cost of servicing these loans, the loan servicing rights have value and are treated as an asset.

Under the typical seller-servicer agreement with FNMA/FHLMC or the pooling and servicing agreement (PSA) in the case of loans sold to Wall Street mortgage trusts, the owner of the loan has permanently assigned the right to service the loans to the servicer.  The servicer is still the agent of the owner.  But the owner cannot usually take back or alter the designation of the servicer.  Instead, the servicer owns the servicing rights and has the right to resell these rights.

So when you receive a notification that the servicing has been sold and that you are to pay a new servicer -- the Hello / Goodbye letter -- it isn't usually the mortgage investor which is dictating a change in servicing (except sometimes when the loan is sold "servicing released" by the originating lender near origination).  More often, the servicer the borrower has been paying has sold the servicing rights to another mortgage servicer.

Mortgage servicing rights are thereby bought and sold totally separately from the promissory note and mortgage debt itself.

While you could probably send a RESPA Qualified Written Request (see other posts on QWRs elsewhere in other threads) to ascertain the servicer's basis for asserting its authority to service the loan, you must bear iin mind that the new servicer isn't actually asserting ownership of the loan.  Rather it is asserting the right to service the loan for the actual owner.

Most often, as the loan is bought and sold, this is transparent to the borrower, as the servicer very often remains the same.

If you are CURRENT on your payments and actually borrowered money from the entity you are (or were paying) or from an entity which seems to have sold the loan to another entity, it is usually inadvisable to initiate a challenge to the authority of the servicer to collect or the entitlement of the asserted mortgage investor to payments.  Very little good can come of this and you may find yourself in default if you refuse to pay. 

IF you are already in default in payments, have missed payments or are unable to pay due to your financial circumstances, you will very likely face a declaration of default, a notice of acceleration and a foreclosure.  How the foreclosure happens depends heavily on the laws of your jurisdiction.  In some places, lenders are allowed to exercise contractual rights to a non-judicial foreclosure through private sale.  In these places, the mortgage investor is usually holding most of the cards.  It is usually very difficult to stop a private sale EXCEPT through bankruptcy.

In other places, foreclosures are conducted in court through a formal judicial process.  This affords the borrower far better protection.

When faced with a judicial foreclosure, sometimes challenging the plaintiff's authority and standing to foreclose can be a very potent defense.

I would NOT encourage you to get into a quarrel with the servicer about their authority to collect UNLESS you are already in foreclosure.

In any case, it would be a good idea to consult a qualified lawyer expeienced in consumer debt and foreclosure defense.
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