Urgent- Accelerated Balance Question

If anyone out there has experience with acceleration, can you please PM me? I am at crunch time with this new modified statement rule.

I think we are accelerating balances prior to foreclosure sale, but I am being told that we never accelerate a balance. How can that be??? We put posting restrictions on the loan. .... I need a drink.

I'm not sure it's possible to foreclose without accelerating.

I would check your Note and Deed of Trust, as well as any letters you send to borrowers prior to foreclosure. This section is killing me as well, and our vendor isn't helping out as much as I'd hoped. If anyone else has more guidance, I'd love to hear it.

I am having vendor issues as well and am starting to feel the time crunch. What you said mirrors my thoughts... how can you foreclose without accelerating! Hopefully our team can run some test statements and make sure the content and formatting come out right once the new info is added. It is sometimes those things that hold up a project just as much as the actual data. Thanks!

What you do to foreclose is a State law issue and you should be sitting down with the legal counsel you use for foreclosures.

Thank you! Our group met to determine next steps; we are now reaching out to our legal council for state foreclosure processes. We will then discuss that in relation to the requirement for modified statements.

If others are in the same boat I am.... and your system is just now ready to implement these changes, here are the concerns I have:
- if the servicing system is creating new fields and statement blocks, these need to be tested to ensure the end product (printed statement) complies with data and formatting requirements. Sometimes a little change can cause something wonky to happen to the look of the statement when it prints.
- new procedure for updating the servicing system with the acceleration and re-reinstatement balance and dates. How often can these change, how timely do the updates need to be made for the statement to produce correctly?
- timing requirement to get the modified statement to the borrower after acceleration
- training front end associates on the new statement info in case borrowers call or come into the branch with questions. (They need to at least know that they should refer the borrower to a collections associate)

One other thought:

Is the modified statement rule effective for loans with accelerated balances starting 10/19 and going forward? or;
Is this required for all loans that were accelerated prior to 10/19 as well?

I think it is the latter, but just wanted to check. I could not find anything in the final rule yet.
Thanks!

Jade'sFire - Don't forget, the only change to the periodic statement is when you've accelerated the balance of the loan under the terms of your loan contract AND you will accept a lesser amount to reinstate the loan. Just accelerating the loan per the contact terms alone doesn't result in any change to your statement.

Do you think you'll have many loans where that is the case prior to 10/19, and where you're still providing statements? After providing the accelerated loan version of the periodic statement wouldn't you shortly thereafter have either a) reinstated the loan because the borrower paid the smaller reinstatement amount, or b) foreclosed? I view the accelerated loan version of the periodic statement as basically the last ditch effort you've giving the consumer to reinstate before you foreclose. I don't imagine you'll be giving that version of the statement very often, or for very long before the loan is either foreclosed or reinstated. If it is reinstated, you're back to the normal version of the statement, and if you foreclose you'll sending the charge-off version of the statement.

Be sure to check your state law and mortgage documents. They might require you to reinstate the loan with a lesser amount in certain circumstances (i.e. making the loan current), and if you'll accept a lesser amount (past due plus fees) to reinstate, then the commentary applies.

Thank you all for the additional thoughts. I will continue to work with our collections department and legal counsel.