North Carolina Mortgage Servicers & the Duty to Disclose Fees
Mortgage loan servicers’ failure to assess fees and notify borrowers in North Carolina is a problem area that I have encountered a significant number of times. North Carolina General Statute § 45-91 helps borrowers understand fees that are assessed to their loans to get timely notice of them.
Requirements of North Carolina General Statute 45-91Every mortgage loan servicer must comply with this statute on every loan it services in North Carolina. The law does not limit this notice to loans that are in default or borrowers that have filed a bankruptcy. Pursuant to the law, the mortgage loan servicer must:
• Assess any fee on the account within forty-five (45) days of it being incurred; and
• Send a clear and concise written statement to the borrower, at their last known mailing address, within thirty (30) days of assessing the fee
Any failure by the mortgage servicer to comply with this law is deemed a waiver of the right to collect the fee from the borrower. This law is applicable to all fees assessed to a mortgage loan, including things like foreclosure fees, attorney’s fees, property inspections, property preservation fees, and any other fees permitted under the terms of the Promissory Note and Deed of Trust.
How Mortgage Loan Servicers Communicate FeesOftentimes, mortgage loan servicers include fees on the monthly statement mailed to borrowers. It is important that you view these statements to make sure you understand the fees and that everything assessed to your loan was done within the required timeframes. When borrowers have a loan go into default or file bankruptcy, mortgage loan servicers often stop sending periodic statements or notices to borrowers. Under North Carolina law, the mortgage servicer must still comply with this law or it waives the right to collect the fees. Please note that the waiver is only for fees that were not properly assessed and communicated, you will still be responsible for the principal, interest, and any escrow amounts due under the loan.
A mortgage servicer’s failure to comply with this law can reduce amounts it claims you owe when trying to pay off a loan, or reinstate a loan that got behind on payments, or when you file bankruptcy. If you are struggling to pay your mortgage or are already behind, please feel free to contact our office for assistance.