What Mortgage Servicer Scams to Watch Out for During a Transfer

Mortgage loan servicing transfers are a routine part of the lending world. Your lender might sell your mortgage to another company as part of portfolio management. While this is perfectly normal, it's also a time when scammers can take advantage of the confusion. At Cabrillo Credit Union, we want to help you stay protected every step of the way.

If your mortgage is transferred to a new servicer, here’s how to protect yourself from fraud:

✅ Make Sure the Transfer Is Legitimate

• Expect two notifications: One from your current servicer at least 15 days before the transfer, and one from the new servicer within 15 days after, according to the Consumer Financial Protection Bureau.  These should include the transfer date, contact info for both companies, and where to send your mortgage payments.
• Only got one letter? That’s a red flag. Contact your current servicer directly using the phone number or website listed on your existing mortgage statement—not anything listed in a suspicious letter.
• Check their NMLS ID: Every legitimate mortgage servicer must have an NMLS (Nationwide Mortgage Licensing System) ID. Look for this number and verify it online to confirm you're dealing with a licensed entity.

💳 Safeguard Your Payments

• Watch the dates closely: Know exactly when your old servicer stops taking payments and when the new one starts. Sending your payment to the wrong place can cause delays—or worse, it might land in a scammer’s hands.
• Update your autopay: If you use online banking or autopay through your credit union, be sure to update the payee details once the new servicer takes over.
• You have a 60-day buffer: Under federal law, there's a 60-day grace period after the servicing transfer. If you mistakenly send a payment to your old servicer during that window, you can’t be penalized—as long as it was received on time.
• Keep an eye on your statements: After the transfer, review your mortgage statements to make sure your payments are posting correctly. If anything looks off, contact the new servicer immediately.

Mortgage servicing transfers don’t have to be stressful. Stay alert, verify before acting, and never hesitate to reach out if something doesn’t feel right.

If you have questions about your mortgage or think you’ve been targeted by a scam, contact Cabrillo Credit Union we’re here to help.