How long does a loan servicer have to notify a borrower of a servicing transfer?

How long does a loan servicer have to notify a borrower of a servicing transfer?

• A. 30 days from transfer
• B. 15 days from transfer
• C. 10 days from transfer
• D. Only after the first payment

Answer: (B)

A loan servicer is required to notify a borrower of a servicing transfer within 15 days following the transfer. This time frame is established to ensure that borrowers are informed promptly about changes that may affect their loan management and payment process. Timely notification helps borrowers avoid confusion about where to send their payments and whom to contact for assistance regarding their loans. This requirement aligns with consumer protection regulations that aim to provide borrowers with clear communication and transparency regarding the handling of their loan accounts. The other options present different time frames that do not meet the regulatory standard, and the choice that suggests notification only after the first payment would not provide the borrower with adequate notice of the transfer, potentially leading to missed payments or complications in loan servicing.

A loan servicer is required to notify a borrower of a servicing transfer within 15 days following the transfer. This time frame is established to ensure that borrowers are informed promptly about changes that may affect their loan management and payment process. Timely notification helps borrowers avoid confusion about where to send their payments and whom to contact for assistance regarding their loans.

This requirement aligns with consumer protection regulations that aim to provide borrowers with clear communication and transparency regarding the handling of their loan accounts.

The other options present different time frames that do not meet the regulatory standard, and the choice that suggests notification only after the first payment would not provide the borrower with adequate notice of the transfer, potentially leading to missed payments or complications in loan servicing.