Mortgage Servicing - Payment & Escrow Abuse - RESPA
	General Rule. Federal RESPA laws protect you from lender accounting errors and escrow mistakes. You may be entitled to statutory damages as well as actual damages, including attorney fees if your lender fails to respond to your inquiries and correct any errors as to its accounting and escrow disbursement history..

If Mortgage lenders often illegally increase their profits through a practice of accounting errors where they fail to properly credit payments and escrow disbursement errors.

Lenders then charge late fees, additional interest, and more junk fees such as inspection fees. Sometimes they don’t pay property taxes or insurance timely, resulting in more interest and penalties, or even very expensive force-placed insurance.

The federal Real Estate Servicers Act (RESPA) requires that your payments and disbursements be accurately done. RESPA requires that your lender respond to requests for information and requests to correct accounting errors.

RESPA applies to loans secured by a 1st or 2nd or 3rd lien on residential property of one to four units. It is also limited to all federally-insured loans, such as FHA, VA, Fannie Mae, and Freddie Mac. Thus, it includes almost all mortgage loans.

Your remedies for RESPA violations include actual damages, statutory damages of up to $1,000, costs, and your attorney fees. However, you only have one to three years to bring your lawsuit, depending on the type of violation.

There are currently, in 2007, several class action suits against lenders for RESPA violations. The suits also are against cooperating third parties, such as the title companies who are closing improper loans.

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