Mortgage Servicing Bankruptcy Coupon Books 2 – For borrowers in chapter 12 or chapter 13 bankruptcy that are more than 45 days delinquent, does the disclosure statement required due to the delinquency require sending a new coupon book?

Compliance > Regulation X and Z - Servicing
Q:   For borrowers in chapter 12 or chapter 13 bankruptcy that are more than 45 days delinquent, does the disclosure statement required due to the delinquency require sending a new coupon book?
 
A:   (UPDATED 3/20/2018): A servicer is not required to change its schedule for sending coupon books due to a borrower in chapter 12 or chapter 13 bankruptcy becoming more than 45 days delinquent on post-petition payments. For example, a servicer who ordinarily provides a borrower with a 12-month coupon book in January of each year may continue to send 12-month coupon books in January of each year for the duration of a borrower’s chapter 12 or chapter 13 bankruptcy case.
 
A servicer must provide a new coupon book after one of the events listed in § 1026.41(e)(5)(iv)(A) occurs only to the extent the servicer has not previously provided the consumer with a coupon book that covers the upcoming billing cycle.
 
For general information about the modifications to the coupon book when a borrower is in bankruptcy, see section 5.10 of the Mortgage Servicing Small Entity Compliance Guide and Regulation Z, § 1026.41(f).
 
 
This Q&A was contained in the CFPB’s Mortgage Servicing FAQs – version 3, as of June 2, 2021 (which may be updated from time to time).  This may be found on the CFPB’s website here:  https://files.consumerfinance.gov/f/documents/cfpb_mortgage-servicing_frequently-asked-questions.pdf
 

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