T Nation

Mortgage Company Problems


#1

Maybe this is a strange request, but since there is such a large, diverse group of people on this site, maybe someone can help me.

In a nutshell, my mortgage company is a nightmare to deal with. I have been going back and forth with these assholes for a year about PMI deletion. I cant describe what it is like dealing with them. They dont respond to letters, emails or faxes.
When you call, you get a customer service rep who is clueless and abrasive. I've also been told about 5 different things. They refuse to put a supervisor on the phone or even provide a name of a supervisor so I could write them a letter.

After threatening legal action a month ago, I got a mysterious letter which seemed to be the answer I was looking for. However, they either forgot or refused to include a needed document and Im fighting to get that now. The legal action threat was somewhat hollow because we're only talking about PMI deletion, which in the scheme of things isnt really that huge an issue although
its costing me $1700 a year for nothing at this point.

Maybe some one in the real estate or legal business can provide me some guidance on how to get a freakin answer from these clowns. Also, Im a little unsure about where to lodge a formal complaint and would be interested in doing that too. Any advice or experiences would be greatly appreciated.

Honestly, all I want is a straight answer. The whole PMI thing is ancilllary. I'm not bitching about the amount of interest they will make off of me before its all said and done, but I
think that it at least entitles me to some type of reasonable customer service.


#2

Easy: refinance. I had an ARM that charged me PMI, so I refinanced the loan after six months and got a fixed rate with no PMI. If you've held the property for long enough, and your equity is high enough (based on the appraised value of the home), this should be no problem.

An additional benefit: if you refinance, YOU don't have to deal with these assholes. Yes, you'll have to go to settlement again, but the settlement attorney and the financing institution will handle your current mortgage holder.


#3

I just had this conversation with my lender the other day. They have no vested interest in the PMI from what I understand. They could care less one way or the other and are given rules they have to follow by the state I believe. They are sending me out some documents and such just like yours. I'm confused by your term Mortgage Company.

Do you have a lender also, or is the mortgage company the lender? If not, I would contact the lender. I'm sure each states rules are a little different, but if you've lived in your home for about 3-5 years and have a good pmt. history you should be able to get it dropped. If not I would certainly research the governing body for this co and screw them to the wall by calling them and the BBB and anyone else. I'd also make a personal appearance at the office and make it loud and clear what I need and that I will not be leaving without the proper information.


#4

I had the same problem with my mortgage company. They said I had to have an appraisal to see if the house was worth more and if we had the 20% equity needed to drop the PMI. Well the bastards got to choose the appraiser and on top of it I had to pay for it. The "appraisal" came in real low so they said they wouldn't drop the PMI.

Fortunately for me at the time rates were real low so I decided to refinance with someone else. They also sent an appraiser which they paid for. The appraisal came back much higher so I decided to refinance with them because they weren't going to charge me PMI. Sorry I can't be of more help but other than refinancing I don't know what else you could do. Maybe you should search around for the best rates and look into refinancing.


#5

You don't think $1700 a year is a big deal???

You're full of shit or just stupid.

I don't know your int. rate or the size of your loan, but I'll tell you this--

by keeping your payments the same and applying that 1700 to the principle you would pay off your 30 year loan in about 13. It would probably save you $150,000-$250,000 (depending on loan amt.) in interest and extra payments.


#6

Find the name of the president on the company's website and send him a letter via regular and certified mail. And other officers/directors too if you can find that info. That way it'll get to someone higher in the food chain than a cust service rep. This method has produced results in the past.


#7

1) Crying foul to the BBB will do little good, if any. Go ahead and do it, but it probably won't make a difference, and you won't feel any better afterwards.

2) Do not go to the office and say anything loudly. You could be removed from the premises and be labeled a "problem customer," which would not help you later on.

As desirable as it is to try to stick it to the man, it's easier just to refinance and kill two birds with one stone. Even if you do get them to fix this one issue, you'll still have to deal with them in the future, and I guarantee you won't cause institutional change in your lender.


#8

I've gotten some very prompt responses from people in authority when I've notified the BBB and anyone else who would listen.

There is nothing wrong with making yourself clear about your intentions when you walk in the office. I don't give a fuck if I'm labeled a problem customer. They're the ones that started the problem. I've already done the nicey nice thing, now I by God want some answers. Its my money. I didn't say bust up the place. And frankly I don't give a fuck what a mortgage company thinks about me. I'm the customer. I'm not gonna bend over and take one in the ass so I won't be thought of poorly. Hell they count on that sort of mentality and then they get away with it constantly. I believe they call em "sheeple".

At any rate, your refinance idea is probably a good one if its advantagous to him. Good call, but I'd still let these fuckers know how I felt and why they were losing my business, and I'd do it to the supervisors/leaders, not the poor schlubs in the office.

The meek may inherit the earth, but I doubt it gets anything done in this instance.


#9

this is the key factor...if you meet this requirement and they(making sure your calling the number on your monthly mtg statement) still are not removing the MI...then they are definitely messing with you.......


#10

Here's my concern: if you are belligerant with the lender, and then you go to refinance somewhere else, it may be possible that the new institution will contact the old one and request your files, which may indicate that you are difficult to work with. I don't know if that's a realistic concern or not, since I'm certainly not an industry insider.

I understand you were not advocating intimidation, but some people do not know how to draw the line between being "assertive" and being "aggressive." Plus, if information is shared between institutions, all it might take is pissing someone off.

Bottom line: money talks. I agree with you that you shouldn't bend over and take anything from your lender, but I can almost guarantee that going to their offices to air your grievances will probably not produce the desired effect. And honestly, why would they even care? Unless you move your loan somewhere else, they won't concern themselves with your unhappiness. After all, they're in the mortgage business... almost ALL of their clients are unhappy.


#11

Most states have an entity that regulates the mortgage/banking industry, your 'threats' to the mortgage company would carry more weight if you mentioned that you are filing a complaint with said entity. For example, in NJ, its the Department of Banking and Insurance.

I work in a title company, in the office of a mortgage company, and the complaints that seem to rise to the top are ones where i hear that name thrown around as well. Too many complaints lodged with the dept will affect the lenders ability to do business in the state.

Unfortunatley for you, you probably signed something at closing called a PMI disclosure or some type of equivalent form, as well as a TIL that you acknowledged you were aware of PMI being required.


#12

I am a loan officer in Illinois, so the things I list may differ in whatever state you reside.

As someone mentioned, you probably signed a PMI disclosure at closing that stipulates that PMI will be dropped once your loan-to-value (LTV) reached a certain point. Oftentimes, it is 78%, but I am not sure if that differs by state, by MI companies, or dictated by the US govt. Usually the lender will require you to pay for the cost of the appraisal since someone has to pay for it, and they figure why should they?

The PMI you are paying is going to a mortgage insurance (MI) company like Radian, GE, or MGIC. When you are making your payment, you don't know who you are paying that to since the mortgage lender, or loan servicer, is taking care of that for you. As far as I know, the MI company is the only one benefitting from this arrangement. Your mortgage company might just be too lazy to initiate this process. I don't see any benefit to them not dropping it other than not wanting to put in the work. What company is servicing your loan?

For clarification, some terms so everyone is on the same page. Mortgage lender, broker, servicer are all different, but for the sake of ease, whoever you are making your payment to is the loan servicer. That is who you need to talk to.


#13

To clarify,

My loan is seviced by Dovenmuehle out of Illinois and that is who I have been dealing with.

I cant refinance. I got a 30 year fixed loan at a 5.02% interest rate. I got lucky with such a low rate because of 1.)timing and 2.)I got it through a program offered by the Police and Fire retirement system in my state(Im a cop). I don't think I will be able to touch so low a rate at this point.

One of the things I have been told by
the customer service representatives
is that they will only allow me to use the original purchase price of the home to figure a loan-to-value ratio. That is a scam and a half, seeing as my home has most likely increased in value by 50 to 60 percent. They are fielding no risk whatsoever.

On another occasion, I was told that
a clause in my mortgage documents did not allow for appraisals to figure a current market value to delete PMI.
I reviewed all of my paperwork and it includes no such clause. My loan agent never told me anything to that effect either. After telling them this, I got that letter saying I could order a new appraisal through them. The appraisal fee schedule was missing however and Im fighting to get that now. If I ever do get, my buddy owns an appraisal company and he has comps in my area all ready should they try and be tricky and come in real low.

Seeing as their offices are about 1500 miles away from me, Im not going in person there any time soon. I wouldn't do that anyway. I was actually concerned about becoming a problem customer because I know thats when people will go out of their way to screw you. I already got one nasty-gram from my tax assessor because these jerkoffs paid my taxes late out of escrow.

I appreciate the advice, but maybe Im at their mercy to an extent. All of it helps because this is my first home and Im figuring a lot of this out as I go.

Also,

What the fuck is that? Im not full of shit...Im not posting all of this for attention. And where would the "stupid" comment come from? Im trying to get this fixed and Im getting jerked around.
How does that make me stupid? I didnt say the $1700 a year was not a big deal...I try to put it in perspective in the scheme of things. Thats all.

You talk like that to people in person?
I doubt it. The internet really promotes some goddamn uncivil behavior I tell you.

End of rant. If anyone has any other ideas I would be happy to hear them.


#14

I have one more bit of advice. As a police officer, you may have access to a credit union in your area. Check out what their mortgage rates are. Yes, 5% is great, but keep in mind that even if you pay 6%, at least the added percent is tax deductible. PMI, on the other hand, is not.


#15

Your points sir, are well taken. I thought about this driving home from work, and I thought about that line between belligerence and assertiveness. It can be hard. I was also screwed by my mortgage co. when I purchased my home. Never even mentioned the PMI...etc.. I won't bore you with the detail, but suffice it to say, its kind of a hot button issue for me. So, consider my rant complete. JL. Good luck to you brother. I hope they get what they deserve.

Peace.


#16

Lots of good advice here. Whatever happens, just remember that $1700 can buy you a whole lot of lawyerin'.


#17

i will speak to the underwriter in the mortgage office today to find out the deal on your pmi. i believe if you closed less than a year ago they may need to use the purchase price to calculate the LTV. after that point you are free to be re-appraised, but let me confirm.


#18

now this info might not apply to your lender, as all can have different underwriting criteria, but if your loan was a cash out refi, the purchase price will be used to determne the loan to value ratio, if it is a rate/term refi, i believe you can get re appraised to determine the new ltv and wether or not pmi is still necessary, run that by someone see what kind of response that gets you...


#19

Federal law governs cancellation of PMI (Homeowners Protection Act of 1998). The Act provides a statutory framework for canceling or automatically terminating PMI. For loans obtained through a lender insured by the Federal Deposit Insurance Corporation (FDIC), the FDIC enforces the requirements of this statute.

I suggest you write a letter to the FDIC with a copy to your Mortgage company. The complaint should include:

Your name, address, telephone number;
The Mortgage Company's name and address;
The loan number;
A description of the complaint, including specific dates and the actions (copies of correspondence is helpful);
Date of contact and the names of individuals contacted at the Mortgage company with their responses;
Your signature and the date the complaint is being submitted.

Federal Deposit Insurance Corporation
Division of Supervision and Consumer Protection
550 Seventeenth Street, NW
Washington, DC 20429


#20

I work for a large bank so maybe I can help you. Most importantly How long have you been in the home and did you get a good deal on the home? In other words did you buy it with equity in it already? Its hard to give you an assessment on the situation unless we have this info.

TR