Are mortgage companies required by law to send monthty statements and payment coupons?
This question touches on federal lending law, state lending law, and the policies of each particular mortgage company. In general, though, most mortgage companies are not required by law to send monthly mortgage statements or payment coupons to their customers who have fixed rate mortgages and are required to send statements to customers who have adjustable rate mortgages. A fixed rate mortgage is one that has the same interest rate throughout the term of the loan; an adjustable rate mortgage has an interest rate that fluctuates, usually with market interest rates, throughout the terms of the loan.
Federal lending law requires that mortgage companies at least send an annual statement at the beginning of the year to its fixed rate customers. Some mortgage companies do choose to send monthly statements with a monthly payment coupon attached to the statement, but it is completely legal and common for a mortgage company to send a coupon book with six months' or a years' worth of coupons in the book.
Federal lending law also requires mortgage companies to send monthly statements to customers who have adjustable rate mortgages. Since the rate on the mortgage can change from month to month, it is imperative that a homeowner have up to date information on the interest rate the bank is charging. When the interest rate changes, the monthly payment changes, also. Without a monthly statement, homeowners may not be paying the correct monthly payment. A monthly statement also arms the homeowner with the correct information needed to make a decision on whether he would like to refinance to a fixed rate.
Whether a loan is at a fixed rate or an adjustable rate, mortgage companies are required by law to supply a customer with a new coupon booklet upon request (they do tend to get lost in a home office frequently). They are also required by law to supply a customer with a current statement upon request.
Many times, however, it is not necessary to phone a mortgage company and request a current statement. The majority of mortgage companies now have all of a customer's account information online. Once a customer registers online with a mortgage company's website, he can access his account information including monthly statements in just minutes.
Current mortgage statements are usually needed when refinancing a loan or selling a home. When they are needed for a financial transaction, most institutions will not accept a simple printout from a website. In this case, an official payoff statement is needed from a mortgage company, and the law requires that payoff statements be issued upon request, too.