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#2269900 - 05/02/22 03:09 PM Servicing Transfer and Escrow Requirements
Aruba123 Offline
Member
Joined: Jan 2012
Posts: 70
New York
Servicing of loans is being transferred to our bank from a loan servicer. The loan servicer is completing a short-year statement as required by § 1024.17(i)(4)(ii).

Short year statement upon servicing transfer. Upon the transfer of servicing, the transferor (old) servicer shall submit a short year statement to the borrower within 60 days of the effective date of transfer.

As per 1024.17(e)(1), we would be required to send an initial escrow statement upon the transfer of servicing if the monthly payment amount or the accounting method used was changing.

We as the new servicer are not changing the monthly payment amount or the accounting method used by the old servicer. Are we required to send our any type of escrow statements to the borrower at the time of transfer? When the old servicer provides the short-year statement to the borrowers, if there are any surplus or deficient balances, would the new servicer have to account for that and ensure compliance with shortages, surpluses and deficiencies? I could not find anything in RESPA to specifically address this but I could be missing it.

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RESPA
#2269901 - 05/02/22 03:22 PM Re: Servicing Transfer and Escrow Requirements Aruba123
rlcarey Online
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rlcarey
Joined: Jul 2001
Posts: 79,637
Galveston, TX
The short year statement that they provide is just going to show amounts collected/paid and the balance forwarded to the new servicer. They are not going to do anything with surpluses or deficiencies. You would handle that at either under 1024.17(e)(2) at the time of transfer, if you were re-establishing a new escrow analysis period, or at the normal one-year period.
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#2269902 - 05/02/22 03:27 PM Re: Servicing Transfer and Escrow Requirements rlcarey
Aruba123 Offline
Member
Joined: Jan 2012
Posts: 70
New York
Thank you rlcarey. I appreciate the response!

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