- Who sends it
- Your servicer or lender, sometimes through a law firm
- What it starts
- A cure period. After the date in the letter, the lender may call the whole loan due
- Do this first
- Find the cure date and amount, then call your servicer and a housing counselor
What this letter is
It goes by many names: breach letter, demand letter, notice of default, notice of intent to accelerate, or default and acceleration letter. They all do the same job. The letter says what you did wrong (usually missed payments), what you must pay to fix it, and the date by which you must pay.
The requirement usually comes from your own mortgage or deed of trust. In the current Fannie Mae and Freddie Mac uniform deed of trust (the California version is one example), the lender must send a notice of default before it calls the loan due. The notice must state the default, what you must do to cure it, and a date, not less than 30 days from when the notice is given (or another period set by state law), by which you must cure. It must also say that not curing may lead to acceleration and sale, and tell you about your right to reinstate and your right to go to court to dispute the default.
FHA, VA, USDA and other loans use different forms, and some states set their own rules, so read your own mortgage or deed of trust.
What it does and does not mean
- It is not a foreclosure sale notice, and it is not an eviction.
- If you do not cure by the date, the lender may "accelerate" the loan, meaning demand the full balance, and then use the foreclosure process your state allows.
- In most cases federal rules still bar the first foreclosure notice or filing until you are more than 120 days behind, even if the cure date has passed.
- Acceleration is not the end. Under the uniform deed of trust you can usually still reinstate (catch up on what you owe plus allowed costs) until the later of 5 days before a foreclosure sale or the period your state law allows. See reinstatement.
How to count the deadline
Use the date printed in the letter as your deadline, not a count of your own. If the letter has no clear date, ask your servicer in writing for the exact cure date and amount. Write the date on your calendar and plan to pay or have an application in well before it.
Check the amount. It should list missed payments and any late charges or fees. If something looks wrong, ask the servicer in writing to explain it, and keep a copy.
What to do this week
- Call your servicer and ask for a written reinstatement figure good through the cure date.
- If you cannot pay it all, ask to apply for loss mitigation. Options include a repayment plan, forbearance, a payment deferral or partial claim and a loan modification.
- Send a complete application as early as you can, and before you are 120 days behind if possible. Keep proof of what you sent and when.
- Call a free HUD-approved housing counselor at (800) 569-4287.
- Look up your state's foreclosure timeline so you know what notice comes next.
What it is called in different states
Some states set the cure period by law, and others leave it to your loan papers. Examples from our state pages:
- Iowa: notice of right to cure, with 30 days to pay the missed installments.
- Kansas: notice of right to cure, only for some loans; the lender cannot call the loan due until 20 days after it is given.
- Maine: notice of right to cure, at least 35 days before the lender can sue.
- Massachusetts: 90-day right to cure notice, then an acceleration notice if the default is not cured.
- New Mexico: notice of right to cure, with a date at least 30 days away.
- North Dakota: notice before foreclosure; paying within 30 days reinstates the mortgage.
- Texas: notice of default by certified mail, with at least 20 days to cure before a sale can be noticed.
- West Virginia: notice of right to cure default; the lender must wait 10 days after giving it before calling the loan due.
- Tennessee: default and acceleration letter; many deeds of trust there give a cure date at least 30 days away.
- Missouri: demand letter, which the Missouri Bar says usually gives 30 days to bring the loan current.
- Default or acceleration letters from your servicer in Alabama, Delaware, Florida, Mississippi, Montana, New Hampshire, Vermont, Virginia and Wisconsin.
Some states also require a separate pre-foreclosure notice. See notice of intent to foreclose.
Scams tied to this letter
- Anyone who asks for a fee before you have signed an agreement with your servicer. A company that is not your lawyer cannot charge for mortgage relief until then.
- Anyone who tells you to stop talking to your servicer, your housing counselor or your lawyer.
- Anyone who wants payment by wire, cashier's check or a payment app, or who asks you to sign over your deed.
- Anyone who says they are with the government or your lender without proof. Call the number on your own statement or letter to check.
Never send your reinstatement payment to anyone but your servicer. See foreclosure rescue scams.
How much time do you have? It depends on your state.
See the foreclosure timeline, deadlines and free local help for the state where the home is.
Common questions
Can I just pay part of the amount?
A partial payment may not cure the default, and some servicers will return it. Ask your servicer in writing whether it will accept a partial payment and whether it will stop the acceleration. New Mexico is one state where the lender must accept partial payments sent in response to its right to cure notice.
The cure date passed. Is it too late?
No. You can usually still reinstate later, apply for loss mitigation, or use your state's other options. Check your state's page for the reinstatement deadline and how to stop a foreclosure there.
I think I am not actually in default. What can I do?
Write to your servicer explaining the error and ask for a payment history. The uniform deed of trust says the notice must tell you about your right to go to court to deny the default. Talk to a lawyer or legal aid; see lawyers by city.
Keep reading
- Late notice and early intervention letterThis letter is a warning, not a foreclosure. Federal rules make your servicer reach out early and tell you about help. In most cases a foreclosure cannot start until you are more than 120 days behind, so this is the best time to act.
- Notice of defaultIn many states that foreclose without a court, a recorded notice of default is the official start of the foreclosure. It is not a sale and not an eviction. It starts a waiting period before a sale can be set, and you can usually still catch up or apply for help.
- Notice of intent to forecloseMany states make the lender send a warning letter before it can start a foreclosure. These letters often give you a set number of days, a cure amount and a list of free counselors. The deadline in the letter matters, so act on it now.
- Lis pendens (notice of pendency)A lis pendens is a public notice, filed in the land records, that a lawsuit or foreclosure affecting your home is pending. It does not mean the home is sold or that you must move. It usually means the court papers are coming or have already been served.
- Foreclosure summons and complaintA summons and complaint means the lender has sued to foreclose. You have a short, firm deadline to respond in writing, often 20 to 30 days from the day you were served. Missing it can let the lender win without your side being heard.
- Notice of trustee's saleA notice of sale sets the date, time and place your home will be auctioned. It is serious, but it is not the end. You may still be able to catch up, get a review, use mediation or file bankruptcy, and each of those has its own cutoff.
Sources
- Freddie Mac: 2021 updated uniform instruments (Fannie Mae/Freddie Mac deeds of trust and mortgages)
- Fannie Mae/Freddie Mac Form 3005, California Deed of Trust (07/2021), sections 20 and 26
- 12 C.F.R. § 1024.41, loss mitigation procedures (eCFR)
- CFPB: Find a housing counselor
- HUD: Avoiding foreclosure
- 12 C.F.R. § 1015.5, ban on advance fees for mortgage relief (eCFR)
- FTC: Mortgage relief scams