What is necessary for a borrower to avoid late charges from a new servicer during the 60-day transition period?

To avoid late charges from a new servicer during the 60-day transition period, it is essential that the borrower is not charged a fee or has a negative rating. This period is designed to ensure that borrowers are not penalized during the transition when their loan servicing is being transferred from one company to another. During this time, if the borrower makes timely payments to the previous servicer or the new servicer, they should not incur late fees, and their credit report should not reflect a late payment for that period.

Maintaining communication can be beneficial, but it does not eliminate the need for timely payment or the protections under the servicing transfer rules. Paying the last bill promptly might seem like a good practice, but it doesn't alone guarantee that the borrower will avoid late charges during the transition. Applying for a loan modification is a separate process and is not necessarily linked to the servicer switch and late payment concerns.