Can I sue a mortgage Co over taxes?

Howdy Folks,

Back from playing in the woods again....

My friend was asking me for advice on this issue. Apparently, I've learned so much on Creditnet that people are now coming to me for financial advice. "Curioser and curioser." This may be a little off the beaten path but I figured someone here might have an idea on how to handle this one.......

She and her husband had a mortgage with Chase (perfect payment history). Chase sold the mortgage to Wells Fargo late last year (continued perfect payment). Wells Fargo drops the ball and does not pay her property taxes until this year. They sent her a letter taking full responsibility, apologizing for the oversight, and informing her that they will pay the penalties for late payment of taxes.

OK, that's fine. However, they also stated that since they didn't pay them until this year, she can't claim "property taxes paid in 2001" on her 1040. They claim that she'll have to file it on her return for this year in addition to her property taxes for 2002.

Is this even correct? My due date for taxes was 28 Jan 2002. Meaning the mortgage company had until then to pay the taxes. As long as I paid my mortgage company to escrow the funds (PITI inclusive) by 31 Dec, I'm able to count the funds as paid in 2001. Is Wells Fargo all screwed up?

Without this deduction, she loses $4000 off her refund. Anybody else have a problem with this? I do! In fact, I think I'm more pissed off than she is! The way I see it, she loses the use of $4000 for a year. Even if she gets to claim it next year, she may not get the full $4000 value back next year.
She and her husband have kids and a house. That's their money, I know they had plans for it.

I don't think Wells Fargo should just be able to say" "Oh yeah, we screwed up. Hope you don't mind if we take 4 grand from you for a year." The way I see it is: If someone's gonna do without $4000 for a year, it should be Wells Fargo. Should she send them an "intent to sue" letter unless they come up with 4 grand pronto?

Anybody got any ideas on how to proceed?

Thanks for your help.

Dancer

 

That's one approach... and that's my fallback suggestion, but I'm gonna include additional inconvenience fees.

However, didn't she actually pay her taxes (into escrow) last year? The failure to disburse the taxes by the bank shouldn't affect her. Like I said, our county's last day to pay taxes without penalties was 28 Jan of this year. If my mortgage company could pay them without penalty in early January and I can claim it on last year's taxes, how come her's is claiming she can't count it as a deduction for last year?

Dancer

 

I agree, but it seems to me that if my mortgage company can pay mine until 28 Jan and I can claim it as paid in 2001, why can't she?

 

Now THAT'S what I've come to expect from Creditnet! I knew someone would know what laws they were breaking, what agency would have oversight, and what statute to sue them under! Thanks.

Thanks also to you, George, for providing the reasoned and practical approach. It's just, at the moment, I'm not inclined to take the reasoned and restrained approach. Their kids go to school with mine and I know that they were planning to use their refund to go to Disney. Her kids were telling mine all about going to see Mickey. I'm not inclined to let Wells Fargo prevent them from taking the kids to Disney.

 

Ok, these people suck!

George, you were right. The "grace period" until 28 Jan confused me. If the taxes were paid by 28 Jan then they would be counted as paid in 2001. Wells Fargo only paid about a month ago.

My friends have contacted the IRS who said: "Nope, gotta claim it next year."

Working from that premise, how do they go after Wells Fargo? They had a fiduciary responsibility to pay on time, as a result of their negligence, my buddies have lost the use of $4000 for the year. Basically, it's being withheld from their bank account due to Wells Fargo's screw-up.

Any suggestions on how to proceed?

Dancer

 

Actually, Chase apparently did it right. Believe it or not! It's Wells Fargo that dropped the ball.

Dancer

 

That sounds good to me George, and thank you for your earlier posts. Unfortunately, in talking to a CPA friend about this, he tells me that that approach sends up red flags to the IRS that shady dealings are going on; and that a mortgage company would rather be sued than open that particular can of worms.

So now I'm trying to find an approach that let's them get their money back asap. Any ideas?

Dancer