U.S. Mortgage Index

Servicing transfer

Definition

A servicing transfer is a change in which company services the mortgage. The borrower starts sending payments to the new servicer after the transfer date named in the notices.

In plain English

The company that sends statements can change even when the loan owner stays the same, or when the loan is sold. That change is a servicing transfer. Old and new servicers send notices that say where to pay and when. This page does not state the notice calendars or the late-fee protection window.

Technical definition

CFPB’s official Ask CFPB page confirms that servicing rights can be transferred and that notices tell the borrower the date payments must go to the new servicer. Regulation X implements those notices. Day counts are current-authority detail.

Why it matters

A payment sent to the former servicer after the transfer date can be misapplied. The concept is the change of servicer, not a new mortgage.

Example

Sam receives notices that a new company will collect the next payments. The loan terms in the note are unchanged. Only the servicer has changed.

Sources reviewed

Important note

This page does not state how many days before or after transfer a notice must be sent.