Home mortgage complaint question

[beachbunny]

I've had it up to here with my bank. Every year, my bank messes with my homeowner's insurance. Last year, for example, it didn't pay my flood insurance on time and I went about a month without it. Now I've just found out that it intends to increase my monthly mortgage payments by $300/month to cover hurricane insurance. I've received next year's insurance bills and done the math and my insurance should only be $26 more a month. How can the bank make a $3000+ mistake? And more importantly, after I'm done with the loan servicing department manager (who I know by name from last year), who else can I complain to?

 

[Sleepy]

Have you inquired about your escrow?

We had a problem with out mortgage company several years ago. Actually, the problem was weeks after our mortage got transfered to another company (not by us), the new mortgage company reviewed the escrow and told us we owed a VERY large sum. I knew that was impossible. As you stated, the monthly mortgage payment jumped by about $75 a month or pay the lump sum. When I called the company, I asked them why the huge jump and they said it was taxes that went up. I highly doubted the taxes would go up by $75 a MONTH! I called the city tax dept and they verified taxes went up, but by a few dollars for the entire year. I called mortgage company back. I asked for someone else and they told me it was insurance that went up. Again, not good enough. Then they just simply said "I don't know" and was going to leave it at that! I was appauled. Then, they said it was taxes again only this time it was because they had paid the taxes for the year and we had nothing in escrow to cover it. WHAT?! Taxes had just been paid weeks ago by the previous mortgage company! It was a mess, but anyway, it got fixed. The only reason it got fixed was because I had to tell them what was wrong by doing their job!

Sorry, but I really don't know who you should complain to. I just kept asking for people higher up the food chain. Even then, it took ME being the one to tell them what was wrong!

 

[bicker]

I've had a lot of "fun" dealing with loan processing offices at banks. I've had a couple that have missed municipal tax payments. They really have no incentive, once they've bought your loan from someone else, to provide excellent service, since everyone's providing poor service.

Having said that, sometimes they are right. On one of the loans, I questioned a $50 per month increase in the taxes portion of the payment. Turns out that the escrow was so low that it was underfunded. It happens. I suppose we could complain to the state for charging so much in taxes!

In the end, they missed payments so much that I lodged a complaint and they released my from escrow requirements. If you can show that they've been irresponsible, that's one approach.

If, however, they're following the letter of the tenets of the mortgage, there's not much you can do. Keep in mind that many mortgages include provisions that require you to maintain a certain amount in escrow, for forecasted tax and insurance payments, and that the bank gets to determine the forecast. Generally, states don't worry too much about such provisions since they don't represent the bank getting any additional money -- they only serve to reduce defaults, which is in the state's interest. You should check the terms of your mortgage closely to see if that's the case with your mortgage.

 

[Griggle]

We also had all kinds of issues with our escrow account. Finally, we just opted out of the bank paying our ins. and taxes and now just pay them ourselves directly. The finances and discipline took some getting used to - but in the end it was worth it compared to the constant aggrevation.

Good luck straightening it all out!!

 

[jenny2]

We also had the above mentioned problem with our escrow. One year they said we didn't have enough, and raised our mortgage $100 more a month! Of course that resulted in us having too much in our escrow... so they reduced the payment... only to inform us the NEXT year that we didn't have enough!

Luckily this was just about the time we refinanced, and switched companies, and our mortgage company now is great - no problems.

 

[lisajl]

Geez...I thought we were the only ones with escrow problems!

I think we need to look into it more than just taking their word for it.

Thanks for posting this!

Lisa

 

[AllyandJack]

My mortgage payments go up every year, too. Property taxes, not insurance, but the same result. I usually get a letter saying I can pay $X. (this year, it was $88.) and my payments will go up slightly (this year, it was only $14./month) or I can not pay $X amount and my payment will go up a lot more. I've tried to pull my escrow, but they won't let me. I can't refinance because my rate is really low and I don't want to pay closing costs.

I'm too tired and too defeated to even research if they have the right to force me to escrow....they probably can, so it would be a waste of time.

Mercifully, I've never had a problem with them paying the bills on time - unlike my previous company before the refinance 2 years ago. I would have to jump on them three times a year - once for insurance and twice for taxes.

They have some set amount that has to be left in the escrow at the end of the period - my company wants me to have over $700. in there after everything is paid. I generally pay $100./month extra to my escrow in an effort to keep the increases low. So, I pay $100./month extra so my payments will ONLY go up $14./month. Makes no sense.