Avoid FDCPA & RESPA Violations
This is a reminder that mortgage servicers may potentially be held liable for violations of FDCPA and RESPA for engaging in certain debt collection practices with respect to subordinate liens if the servicer continues to attempt to collect the debt due under a subordinate lien after the 1st lien has been foreclosed upon. This may present a potential problem for both Cenlar and for our clients when we service only a subordinate lien, without also servicing the 1st lien. If the 1st lien is foreclosed upon by another party and Cenlar is not made aware of the foreclosure, Cenlar will continue collection efforts on your behalf.
In order to avoid potential violations of FDCPA and RESPA in such circumstances, it is incumbent that you notify Cenlar promptly when such a situation arises. If Cenlar services only a subordinate lien on your behalf and you receive notification that another party has initiated a foreclosure against the 1st lien, you must promptly send a copy of such notification to Cenlar so that we can cease collection activities against any subordinate liens in a timely manner. Those notifications should be directed to firstliennotification@cenlar.com.