Occassionally i get a client that comes to me and says they want to do a "RESPA request" or a "QWR" (Qualified Written Request). What they are referring to is a requirement under the Real Estate Settlement Procedures Act (RESPA) that requires lenders to reply to a written request for information or statement of dispute from a borrower. The lender must acknowledge receipt of the letter within 20 days and respond within 60 days. An example would be a life of loan accounting. The lender would then have 60 days from receipt to provide this. Another example would be a dispute regarding a service fee. This would have to be investigated and addressed within the 60 day period.
Now, if the lender does not do this, there is some civil liability. If found liable, the lender must pay actual damages (probably minimal or non-existent in most cases), attorneys fees, and possible $1,000 (if it can be shown that there is a pattern and practice of the violation).
Here are things a QWR does not do:
- stop a foreclosure
- stop negative credit reporting (unless there is a dispute as to a credit reporting issue)
- stop the collection of payments
- guarantee a loan modification
Overall, RESPA is a useful consumer law that is violated by lenders/servicers on occassion. It is a good way to obtain information as well that may form the basis of a later civil action. In order to make a QWR you simply have to identify the loan and borrower in a letter sent to the servicer along with a request for information or dispute. As with many laws, its always best to seek legal counsel.