Wednesday, October 24, 2007

Mortgage Matters

I had an interesting experience with my mortgage company last week. Here’s a little bit of background on what happened. The District of Columbia has a program where first time home buyers are exempt from paying property taxes for the first five years that they own their homes. I was lucky to be able to get that tax break. Well it expired at the end of September.

I called my mortgage company and was told to fax the letter from the District stating the tax exempt period was over. The mortgage company would factor in the new payment based on having to pay taxes. In the middle of September, I received my annual escrow account disclosure statement. It factored in the taxes into the mortgage payment. At the end of this statement was the new mortgage payment which would take effect on November 1, 2007.

That’s the important date to remember November 1. So I get a statement for my October payment. I send off my check. Then last week I get a letter from the mortgage company. It says: We recently received a payment from you but are unable to apply it to your account. I did not pay the proper amount. Continuing:

It appears the payment is short and cannot be applied to the account due to one or more of the following reason(s):

( ) Escrow Shortage Due To Analysis
( ) Interest Rate Change
( ) Escrow Payment Not Included
( ) Mortgage Insurance Not Included
( ) Transposed Numbers
( ) Cannot determine the reason the payment is less than the amount due.

One would assume that with parentheses in front of each item that one or more would have been checked but not one of them was.

So I called the bank. I was told that the mortgage payment had changed on October 1. My response was that nothing sent to me reflected that there was a new payment amount in October or what they amount would be. After all the official escrow analysis from the bank said that the new payment wasn’t due until November 1. If I was supposed to have paid a different amount in October, I should have received another statement. At the other end of the line was well hmm. Yes I guess you’re right sir.

My next question was would I be getting a late charged tacked on. One is applied if you don’t pay by the 16th of the month. I was told that once I sent in the additional amount to make up the difference in payment that the whole payment would be applied to my account. Also that I would not be paying a late fee.

I said I was not happy that this had happened. I said I should have received another statement reflecting the change in the payment. I added I was going on the documents that the bank had provided and those stated that the new payment would not go into effect until November 1. I said this was very bad customer service. Many apologies from the other end of the line.

And the upshot of all this: Monday in the mail I received another statement. It showed a past due amount along with a late charge. What a surprise.

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