I know there are exemptions for not disbursing or providing a statement when a customer is delinquent, but what about when we are expecting a loan to payoff.

My scenario: customer's insurance and new analysis statement due 5/11. However, we have evidence/proof that the customers are selling the property, set to close on 5/15; which means our loan will paid off just a few days after the insurance and analysis are due.

In this case, are we still obligated to pay the insurance and provide the new statement (especially the statement since they will get a payoff statement shortly after)?

However, we have evidence/proof that the customers are selling the property, set to close on 5/15.

The dance does not end until the song is over. Why do you care if you have a servicing deadline?

Well, I figured there wasn't an exemption, but was just trying to see if we can save ourselves a step or two.

And if closing gets cancelled - then what?

customer's insurance and new analysis statement due 5/11

Is 5/11 the end of the computation year or is that the date the analysis is due to be delivered to the borrower?

First - I would pay the insurance. I wouldn't want to take a chance not paying it and something happening where a claim would be denied due to non-payment of premium and the borrower coming back on the bank.

Second - If 5/11 is the end of the computation year you have 30 days from that date to provide the annual analysis.

The computation year ends on 5/11. So, are you saying not to worry about running the analysis and providing the statement?

As for the insurance-the loan officer spoke to the customer and they advised that they have spoken with the agent, and the agent is working on a pro-rated amount to cover through the closing date and that they will be paying that bill. I'm sure this causing issues for us...

I'm just advising you of the regulatory requirements.

(i) Annual escrow account statements. For each escrow account, a servicer shall submit an annual escrow account statement to the borrower within 30 days of the completion of the escrow account computation year. The servicer shall also submit to the borrower the previous year's projection or initial escrow account statement. The servicer shall conduct an escrow account analysis before submitting an annual escrow account statement to the borrower.

(iii) Short year statement upon loan payoff. If a borrower pays off a federally related mortgage loan during the escrow account computation year, the servicer shall submit a short year statement to the borrower within 60 days after receiving the payoff funds.

I am not sure why any servicer would alter their normal service processing procedures - pending pay-off or not. It just leads to the potential of all sorts of bad things happening.

Fair enough, I will follow normal operating procedures. I appreciate it!