Montana Code 32-9-169. Mortgage servicer prohibitions
32-9-169. Mortgage servicer prohibitions. A mortgage servicer may not:
Terms Used In Montana Code 32-9-169
- Borrower: means a person seeking a residential mortgage loan or an obligor on a residential mortgage loan. See Montana Code 32-9-103
- Escrow: Money given to a third party to be held for payment until certain conditions are met.
- Escrow account: means a depository account with a financial institution that provides deposit insurance and that is separate and distinct from any personal, business, or other account of the mortgage lender or mortgage servicer and is maintained solely for the holding and payment of escrow funds. See Montana Code 32-9-103
- Mortgage: The written agreement pledging property to a creditor as collateral for a loan.
- Mortgage: means a consensual interest in real property located in Montana, including improvements, securing a debt evidenced by a mortgage, trust indenture, deed of trust, or other lien on real property. See Montana Code 32-9-103
- Mortgage lender: means an entity that closes a residential mortgage loan, advances funds, offers to advance funds, commits to advancing funds for a mortgage loan applicant, or holds itself out as being able to perform any of those functions. See Montana Code 32-9-103
- Mortgage loan: A loan made by a lender to a borrower for the financing of real property. Source: OCC
- Mortgage servicer: means an entity that:
(a)for forward mortgages:
(i)engages, for compensation or gain from another or on its own behalf, in the business of receiving any scheduled periodic payment from a borrower pursuant to the terms of a residential mortgage loan, residential mortgage servicing documents, or a residential mortgage servicing contract;
(ii)meets the definition of servicer in 12 U. See Montana Code 32-9-103
- Property: means real and personal property. See Montana Code 1-1-205
- Settlement: Parties to a lawsuit resolve their difference without having a trial. Settlements often involve the payment of compensation by one party in satisfaction of the other party's claims.
- State: when applied to the different parts of the United States, includes the District of Columbia and the territories. See Montana Code 1-1-201
(1)fail to comply with the mortgage loan servicing transfer, escrow account administration, or borrower inquiry response requirements imposed by the Real Estate Settlement Procedures Act of 1974, 12 U.S.C. § 2601, et seq., and regulations adopted under that act;
(2)fail to comply with applicable state and federal laws, rules, and regulations related to mortgage servicing;
(3)fail to provide written notice to a borrower upon taking action to place hazard, homeowner’s, or flood insurance on the mortgaged property or to place the insurance when the mortgage servicer knows or has reason to know that there is insurance in effect;
(4)place hazard, homeowner’s, or flood insurance on a mortgaged property for an amount that exceeds either the value of the insurable improvements or the last-known coverage amount of insurance;
(5)fail to provide to the borrower a refund of unearned premiums paid by a borrower or charged to the borrower for hazard, homeowner’s, or flood insurance placed by a mortgage lender or mortgage servicer if the borrower provides reasonable proof that the borrower has obtained coverage so that the forced placement is no longer necessary and the property is insured. If the borrower provides reasonable proof within 12 months of the placement that no lapse in coverage occurred so that the forced placement was not necessary, the mortgage servicer shall refund the entire premium.
(6)fail to make all payments from any escrow account held for the borrower for insurance, taxes, and other charges with respect to the property in a timely manner so as to ensure that late penalties are not assessed or other negative consequences do not result regardless of whether the loan is delinquent unless there are not sufficient funds in the account to cover the payments and the mortgage servicer has a reasonable basis to believe that recovery of the funds will not be possible.