Mortgage Reinstatement
Mortgage reinstatement is the restoral of a mortgage to its original condition after a borrower defaults. This means that if you are X amount of months delinquent on your mortgage payments, you can catch them up (and pay late fees) in order to avoid foreclosure.
What is included in a mortgage reinstatement quote?
A reinstatement quote is what is given to a borrower that outlines what they owe. This will typically include:
- Back and current payments
- Any late fees
- Cost of property inspections
- Any attorney or trustee fees and costs for the foreclosure process
- Expenses related to preserving and protecting the lender’s interest in the property
- A recording fee for the notice of cancellation of the sale
Disagree with the quote?
If you believe the quote to be incorrect, contact your servicer, law firm, and/or your trustee, both verbally and in writing. Send your servicer a notice of error. This is a letter that includes your name and information that allows the servicer to identify your mortgage loan account and a description of the error. In this case, the error would be an inaccurate payoff amount. If there is an error, the servicer must fix it within seven days, excluding weekends and public holidays. If the servicer does not respond, consult with an attorney.
Reinstatement before the foreclosure process
Ask your lender for a reinstatement quote. If you pay the amount listed on the reinstatement quote, you will no longer be in default and can resume your regular payments. Be sure not to accept any verbal reinstatement quotes, as these may be inaccurate and are subject to change. Additionally, verbal quotes are impossible to verify later in the process. Make sure the lender gives you the quote in writing.
Reinstatement after the foreclosure process
Work with a trustee instead of your lender. A trustee is hired by the lender once the foreclosure process is started. Once hired, the trustee becomes responsible for documenting and holding any reinstatement quotes. If you fully reinstate before the deadline, the trustee will cancel the foreclosure.
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