Rookie Homeowner Goof Gone Wicked Frustrating

I bought my house in November of 2006 for a little more than 200K at 6.5% and zero down. Yes, you read that right. Zero down. My dad won’t shut up about how I am probably one of the last few people who got a zero down loan. I am not exactly a stupid person though. I had a pretty good understanding of the difference between fixed and variable loans and I absolutely knew I wasn’t having one of those loans that could skyrocket out of control. I mean, I know my luck and I could also read the writing on the wall. Even then I could tell the housing market was slowing down. I knew more than a few people who’d been trying to sell their houses for half a year or more and they were good houses at market rates.

So that said, I got my loan from Lender A and I basically understood that the payments would be a set amount every month because it is a fixed rate loan, right?

Then in August I receive my city/town tax bill. It was a whopper, but luckily our little town lets us pay half of it on October 1rst and half of it on April 1rst. This is about the same time that the housing bubble began to burst and all of those sub-prime loan companies began having those issues. Countrywide, who was not my lender, almost went bankrupt overnight. It seemed like the whole world was going to collapse under the weight of the irresponsibility of out-of-control lenders. I was glad that I had my fixed rate loan and I was feeling smugly responsible.

Imagine my surprise when I received a letter from Lender A that they have sold my loan to Lender B and that starting September 1rst I should begin making payments to Lender B. Well, I chalked it up to the fickleness of the whole mortgage market thing and went on being responsible, paying my mortgage with just a change of address and apparently account number.

I also paid my town taxes on September 25th, thinking that was the responsible thing to do. None of the people I mentioned it to told me I should or shouldn’t write a check out.

Now, this month, I received a statement from Lender B with a “New Escrow Analysis” — basically a projection for 2008 — and a higher amount due each month by about $65. Since I thought that a fixed rate meant they couldn’t change the payment, I was confused until my father, the CPA, explained about how they reassess the Escrow every year based on the payments that had to be made the year before and the required safety net they feel needs to be in the account. However, he didn’t think that my increased taxes (they went up by $500 this year) should have increased the monthly payment by $65 per month.

And as I reviewed the statement that’s when I realized that Lender B was projecting making a payment in March and one in September to pay for my town taxes. This made me wonder if my mortgage company had also paid my taxes last September. However, it was Sunday and no offices were open, so I had to wait until Monday for an answer.

On Monday I called the Town office and asked if two payments were made for my lot. Apparently one payment had been made on September 5th and one on September 27th. I went to my bank’s online website and pulled up the canceled check and it had been written on September 25th. So the end of the month payment was definitely mine.

I called Lender B. The first person I talked to told me that they had no record of any payment going to pay taxes, which means that Lender A probably did it. She also told me that when they acquired my account, the Escrow was in the negative, which is why they increased my monthly rate — they want to ensure a nice safety net every month so it never goes that low again. I asked her if I could prove that the taxes are now paid for the whole year, would they remove the March tax payment and lower my monthly rate. She told me that removing that payment wouldn’t change my monthly rate any.

So, I decided to get a refund from the Town for the amount of $877.03 which is my half of the double payment. I was told by the Town Assessor to write a letter explaining it and fax it to their office. They then called me back and told me that I also needed a letter from the Mortgage company saying that I can have that money. I don’t know why since it’s my money.

So I called Lender A since they were the ones who paid it and Lender B said they didn’t have records of it. Lender A does have a record of it. They paid it on August 23rd, which I guess is why the escrow was in the negative. If the taxes were up $500 from the year before and were split into two payments then the half payment was $250 more than they expected and might have overdrawn the account, which they then transfered immediately to Lender B on September 1rst. (I don’t know why they paid the taxes a month early.) Anyway, Lender A said they could not legally get involved but that they had indeed sent all of the records to Lender B so they should have some record of it.

And so, I called Lender B back and talked to another person who didn’t see the record but she did type up a request from me to get a letter sent to the Town office asking for a refund since they are going to be paying that second half out of the escrow in March. She said that I’ll hear back in 18 days. Now the Town would have zapped me a check tomorrow, but the mortgage company has got to drag it’s feet.

My dad says the easiest thing to do now is to wait until March when the second payment is made and then go to the Town Assessor and ask for my refund. He said the Town won’t be able to require my mortgage company’s permission because it’ll be all about me then. He tried to be comforting and say that I wasn’t going to lose out in this that somehow I was going to get the $877.03 back, that this isn’t a loss, but I guess I’ve been trained too well by him over the years because I already feel it’s a loss; while that money is sitting in the Town’s bank account, it isn’t sitting in my interest-bearing checking account earning me fractions of pennies.

Besides, I could really use that $877.03 this Christmas; I think I was a little too spendy.

Tagged as: homeowner, mortgage, photography, taxes