Mortgage Escrow Account Errors
My most recent mortgage statement for our rental property (originally our primary residence) included the annual escrow review, and I was surprised to see that they projected a shortfall between the escrow expenses (taxes, insurance, and allowable reserve) and my monthly escrow deposits. In fact, the difference was such that the mortgage company was raising my monthly mortgage payment from $691 to $818.
At first glance that did not seem logical to me — we’ve been paying this mortgage for almost 6 years and never had the payment go up like that. Further, our taxes have remained stable the last two years and we haven’t changed our home insurance since we converted it to a landlord policy.
Busy at the moment, I put the bill aside and just returned to it today. After careful, line-by-line reading, I discovered that the mortgage company planned to pay my annual $953 property tax both in May and November — not half every six months, but the full amount twice a year.
Interestingly, when I finally got on the line with a real human being, I was told not to worry because the company only pays bills that come in and they wouldn’t actually pay that amount twice if they weren’t billed accordingly.
“Right,” I said, “But see, I’d really rather not pay an extra $100 a month for a bill that’s not going to come.”
“Oh, that does make sense. Let me connect you to someone who can help you.”
The next CSR greeted me with, “So you want us to pay your tax bill annually instead of semi-annually?”
So I explained it all over again and she re-worked the escrow account while I waited. Turns out my payment would only go up an extra $2 a month once she corrected the escrow problem.
“But there’s also now an overage in your escrow, so would you like me to send you the extra $132?”
I suggested that they just apply $24 to the account to keep my payment from changing and send me the rest.
Pause. “Oh no ma’am, I can’t do that. My computer can’t do that.”
And these are the companies we’re bailing out with taxpayer funds?
we got caught up in the foreclosure crisis (sort of) we had an arm. it was at a price we could afford. we were promised after a few years it would be swapped to something more stable.
instead the arm rose extremely high. We called the mortgage office to try to utilize the laws and help put into place to help people like us to redo the arm to a less extreme rate(the same as it was or only slight higher versus 20% higher with no end in sight. but we were met with paperwork and more paperwork. we were told it went to a department and given a number to call for questions. were were promised we would get a call back.
after a year of playing this game, we never got a call back, when we called either the department didn’t exists or the number had been disconnected, or an agent in a different department told us it was being reviewed and we were given more paperwork.
soon the arm was killing us. so we got fed up. we considered foreclosure but were told we would pay fees to sell it, like fees to upkeep the lawn, the utilities and responsible for whatever the bank could not get for the loan if they sold it cheaper.
so we filed chapter seven and short sold the house.
now we rent our in laws house,who rents my husbands brothers house who’s brother moved into his new wife’s house(so we played musical houses our house being the ultimate causality.)
but my in laws house we rent is owned no mortgage. they pay their sons mortgage(my brother in laws house) and my brother in law who moved in with his wife her house is paid off. so we all contribute to one mortgage(which is almost paid.) we all work for and the same family buisness and pay into a good HMO at a low cost for insurance. so life is still ok(as long as the buisness still stays above water)
our arm was by Litton loan, which was really JP Morgan, which got all that tax payer money, and did nothing to help us.
then after the short sale, the chapter seven. the realitor for the buyer had the nerve to complain the the appliances were not new(they were the originals we got with the house) that the dryer we replaced twice was dead(but fixable) and that we took the refrigerator(that did not come with the house that we paid for) but never mentioned the thousands of dollars in landscaping,repairs,new windows and the solar attic fan my husband installed. and also we should revisit the fact, we get nothing but freedom from this sale.
then they (litton loan/jp morgan)tried to skirt their taxes and push them off on us to add injury to insult(which our accountant quickly fixed and we were off the hook as it was Litton loans or JP Morgans not ours) and those were in the SIX DIGITS.
I think this mortgage era is going to be know not as the age of the arm or the Escrow errors…it will be known as the age AMERICANS GOT SCREWED!
Luckily we are in a better place. but geeze, whats next?
January 31st, 2011 at 9:58 pm