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D2-2-06, Sending a Breach or Acceleration Letter (11/14/2018)

Introduction
This topic contains the following:

Requirements for Conventional Mortgage Loans

The servicer must issue the breach or acceleration letter as described in the following table.

If the property securing a first lien mortgage loan is... Then the servicer must issue the breach or acceleration letter...

not vacant or abandoned

no later than the 75th day of delinquency.

vacant or abandoned and the mortgage loan is greater than 30 days delinquent

within 10 days from the determination of vacancy but no later than the 75th day of delinquency.

Unless the servicer is able to contact the delinquent borrower and is discussing some type of workout option, the servicer must refer the mortgage loan to foreclosure upon expiration of the breach or acceleration letter. See E-1.2-02, Timing of the Foreclosure Referral for Mortgage Loans GenerallyE-1.2-02, Timing of the Foreclosure Referral for Mortgage Loans Generally for the timing and requirements for referring the mortgage loan to foreclosure.

The following table lists the requirements for the content of the breach or acceleration letter.

✓ The breach or acceleration letter must clearly explain...
 

The exact nature of the breach (for example, a default in payments).
 

The action required to cure the breach.
 

The date by which the breach must be cured.
 

The possibility that a deficiency judgment might be pursued if the foreclosure proceedings are undertaken, if applicable.

Requirements for Government Mortgage Loans

For FHA and VA mortgage loans, the servicer must follow applicable FHA and VA guidelines.

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