Q: What is a Qualified Written Request (QWR) and what are the requirements for response?
A: A QWR is written correspondence, other than a notice on a payment coupon or bill statement that: a) includes, or otherwise enables the servicer to identify, the name and account number of the borrower; and b) includes a statement of the reasons the borrower believes the account is in error or provides sufficient detail to the servicer regarding other information sought by the borrower.
Upon receipt of a QWR, a mortgage servicer is required to take certain steps, subject to deadlines. The mortgage servicer has five business days to acknowledge receipt and must respond within 30 business days (with a possible 15-day extension provided the servicer sends the borrower notice of the extension and the reason for the delay). During this period beginning on the date of receipt, the servicer may not provide information regarding any overdue payment, owed by such borrower and relating to such period of qualified written request, to any consumer reporting agency.
It's important that a master servicer implement processes and controls to ensure all correspondence is properly reviewed to identify and segregate the tracking and/or monitoring of QWRs. Items to review include, but are not limited to, the date of receipt, date of acknowledgement of the QWR, date of response, and/or date of request for extension. Internal controls should be implemented to alert the management team of any approaching date where the appropriate action has not been taken, prior to the regulatory time frame. It is also recommended the servicer follow up on any corrections of identified errors to determine whether the issue may be indicative of a systemic problem and/or involve a larger population.
Failure to comply with QWR requirements could lead to a borrower claiming statutory damages in the amount of $2,000 and/or statutory damages in a class lawsuit in the amount of $1,000,000.