HB 24-1011 Summary

• Mortgage servicers must disclose upon borrower request the specific conditions under which they will disburse insurance proceeds when residential property is damaged or destroyed.

• Borrowers must create a written repair or rebuild plan with their contractor and submit it to the mortgage servicer for approval within 30 days; the plan must include specific milestones for disbursement of insurance proceeds.

• For non-delinquent borrowers or those less than 31 days delinquent, mortgage servicers must disburse $40,000 or 33% of proceeds (whichever is greater) upfront if proceeds exceed $40,000, then disburse remaining funds based on repair progress and milestones.

• For borrowers more than 31 days delinquent, mortgage servicers must disburse $5,000 or 25% of proceeds (whichever is greater, capped at $10,000) upfront if proceeds exceed $5,000, then disburse remaining funds in 25% increments upon inspection verification.

• Mortgage servicers must disclose mortgage interest rates to borrowers upon servicing commencement, provide a primary contact in writing, retain all communications for four years, and hold undisbursed proceeds in interest-bearing accounts at national money market rates.