Need your support..bill for new law

We need monthly statements NOT coupon books while paying our Mortagage payments. Here we go again!!!!!

In early October we paid our Mortgage payment for our November 1st payment, as well as our cable bill. We inadvertently placed the checks in the wrong envelopes. Comcastâ??s payment went to our mortgage company and our mortgage check of nearly $600.00 went to Comcast. This simple error has turned into an exhaustive, costly process to clear up.

We pay our monthly mortgage payment utilizing a coupon payment book provided by our mortgage company. We do not get a monthly statement. Therefore, we had no way of knowing this mistake of sending the wrong checks to the wrong companies took place as NEITHER the mortgage company nor Comcast bothered to make a telephone call to advise us of this error.

On or about Nov. 17th we received a letter from our mortgage company advising us that we owed our November payment along with a late charge. Knowing that we are NEVER late on any payments, I pulled our bank statement out and found that the check had cleared. I contacted the Mortgage Company to advise them of this and they asked us to obtain a copy of the front and back of the check. As our credit union/bank no longer sends us our cancelled checks with our bank statement, we had to order and pay for copies of the cleared check.

The next morning we went to pay for and pick up the check. We immediately faxed it to our Mortgage company. Later that afternoon I called to confirm it had been taken care of and they relayed that they were researching it and as long as I had the cancelled check, we didnâ??t have to worry about the late payment, etc.

Believing all was taken care of we enjoyed our Thanksgiving and felt the issue was over. To our surprise, we received a phone call on December 1st at 5pm notifying us that through their "research" they found they had not cashed the check, rather Comcast had cashed it. I asked if they cashed our comcast check then....their was no mention of that money....As far as our comcast check sent to them..., they placed $25.00, and change, on principal and retained the other $25.00 for a late charge, even though on their notice they sent us infoming us we were late, never indicated they received ANY payment, such as the comcast check.

Further upsetting was the fact that now it was December 1st, which means our perfect credit rating would NOW reflect a 30 day late payment which would be reported electronically to the credit bureaus. I know first hand how difficult it is correcting an erroneous credit report.

In an attempt to overt this foreseeable problem I asked to pay the payment over the phone as it was NOW, December 1st, and we would track the money down with Comcast ourselves. They allowed me to do so however they also charged a fee to pay by check over the phone. After doing so I asked if this stopped the reporting to the CRAâ??s. My answer was that since it wouldnâ??t be credited until December 2nd, it most likely would in fact be electronically reported however, we could get copies of our credit reports and dispute the 30 day late payment and they would respond to the CRAâ??s it was in error. Right!! Sounds familiar!

As you can see, had the mortgage company (or Comcast) contacted us prior to crediting our account, all of this could have been averted. I donâ??t understand how a check written payable to a mortgage Company could be cashed by Comcast. Further upsetting is that it would come across an employeeâ??s desk and they would physically credit our account, paying us ahead, and not contact us. They had to know it was not our intention as the amount was large and not payable to Comcast, rather to a Mortgage Company..

A check made payable to someone else should have raised a red flag for someone to contact us. We would have then been apprised to what had happened and could have rectified it immediately prior to enduring these costs, credit concerns and anxiety dealing with rectifying a mess that was exacerbated unnecessarily.

Had the Mortage company contacted us in October, when they received the November payment, and well before December 1st, we wouldnâ??t be in the "system" to be reported as a 30 day late payment to begin with. Had we received a monthly mortgage statement from them we would have seen that we were not credited for our payment. By our paying with a coupon book as we do, we all have no way of knowing if our payments are applied properly and in this case our bank statement showed the check had cleared.

I think it speaks volumes that corporations contact their customers if a bill is late, but do not contact customers when an obvious overpayment was made and when the check was payable to another company. I have contacted my Congressman, Peter Deutsch, to assist me in sponsoring a bill requiring monthly statements as opposed to utilizing coupon books. This is my second time around with major difficulties due to utilizing coupon payment books.

Paying additional principal while utilizing a coupon book does not allow us to track where our payments are being applied. This is where my troubles began so many years ago.

In 1992 I wanted to refinance my mortgage, I had been paying with coupon book. To my horror, I found many payments were misapplied and my extra principal payments were not credited. Many amortization schedules later, it became quite apparent that they had no idea how to derive at the amount I actually owed.

After living this nightmare, I testified before the Massachusetts Banking Committee and sponsored a Bill with Senator Stan Rosenberg (S16). I submitted petitions signed by tens of hundreds of consumers, trying to enact a law mandating all mortgage companies/lenders to send consumers monthly statements to afford us our right to verify and track that our payments are being applied correctly. Especially our extra principal and escrow payments.

Not only did S.16 not get set aside but the bill was warmly welcomed by the legislators. After hearing of what happened to me, they gasped and openly spoke of their fears as they too pay down on the principal monthly with extra payments and blindly trust the payments are applied properly. The bill was never enacted into law due to the report coming back that it would only mandate the State Chartered Banks and most were already utilizing monthly statements. Further, Fleet Bank told the committee they voluntarily were opting to use monthly statments in the future. A monthly statement is the only way we can verify this information as we would see monthly how our payments were applied. That way we could stop any problem immediately and not years down the road where it is impossible to verify the correct amount due the creditor when attempting to refinance or sell the property.

The only way to stop this abuse is to fight for monthly statements. If you agree that we need to be able to verify how our mortgage payments are being applied, please forward a copy of this letter or your own letter to your representatives supporting this necessary change.

Denise Richardson

Hollywood, FL

deniserichardson1@netzero.com

 

No, an automatic debit does not stop the problem it only exacerbates it. let me explain why....A lot of us like to include additional principal money in our payments to bring down the cost of interest and payoff our loans quicker. However, without having a monthly statement to verify that this was done properly, we have no way of know if we have paid down the principal or if they mis-applied which I have found from many consumers to be the case. Take for example, being paid in advance without you knowing it (it happend to me and they had me paid a year in advance without giving me the interest credit) also, payments made on (for example) January 23rd for the Feb. 1st payment, were actually applied as a LATE payt. for February and a late charge was addtionally taken out of the supposed "extra" principal paid. This was all only discovered after months of wrong amortization schedules. It only makes sense that if you are paying on a 15 or 30 year loan and you want to track and watch your principal go down monthly, that monthly statement are the only way we can verify this. If an error is found immediately, it can be rectified without tracking back months of misapplied interest credits. I know of people who had no idea they were not applying their payments properly until they went to sell their home and then found out the lender had mis-applied several thousands of dollars. it was such a mess, as mine once was, that they couldn't sell until a year later after the ocurts got involved to correct. HUD estimated a few years back that over 1 BILLION dollars were owed to consumers in misapplied escrow monies...that doesn't even count our "extra" addtional principal payments.

 

It doesn't matter what is spelled out in a an agreement or mortgage as far as how they account for payments. We should know that simply by reading of all the posts on this site that pertain to errors made on their accounts or credit reports continual errors happen. The mistakes made by lenders are the same type as the credit industry, systemic...If there were not so many errors and inaccuracies, there wouldn't't be so many law suits and sites such as this wouldn't be necessary. Our right to verify how our payments are handled should be common sense. Being unable to verify how our payments are applied, not only affects our mortgage but it also affects student loans and car payments as well.

Late payments can be deducted from your extra principal payments or added on to the payoff balance of your loan without our knowledge. I know of people who had the term of their mortgage extended simply by misapplied escrow and extra principal monies and late charges inaccurately posted to their accounts. Most student loans are also paid by coupon books.

From clarkhoward.com Clark is a Radio show host from Atlanta... this is part of one of his articles on his site.


Student loan payers owe more money - April 16, 2003
Would it be a bargain if you owed a student loan and the company made a math error and started collecting less money from you? It might be fun when you got to what you thought was the end and youâ??d paid off the loan. But it would be quite a let down when the company discovered its mistake and presented you with a huge bill thousands more dollars. Well, it happened to Sallie Mae, one of the largest student loan providers in the country. It happened because of a computer programming error and is now affecting more than 1 million people. If you have a 10-year variable rate, federally guaranteed loans, including Stafford and Plus loans. If you havenâ??t started a repayment plan, you are not affected. But those who have started a plan will owe money. It took Sallie Mae six months to find out what was going on, so it will take a while to get the error corrected. The good news is that Sallie Mae is waiving the additional interest on the loans. You still owe the balance, but they will not charge you interest. So, essentially youâ??re getting the remainder of your loan interest free. Clark thinks this is a smart, fair move on Sallie Maeâ??s part. You need to remember that the student loan system is extremely inaccurate, so itâ??s important for you to run your own amortization schedule. And be sure to keep your student loan records forever! from http://www.clarkhoward.com

the petition will be presented to our regulators and legislators for both student loans and mortgage payments see: http://www.ipetitions.com/campaigns/monthlystatements/

Accounting errors and computer errors in the banking industry are like the credit industry, systemic. There wouldn't be lawsuits or the need for sites like this if there were no accounting errors. Please take a moment to sign the petition. If it hasn't happened to you yet (that you are aware of) it doesn't mean that it won't.
_________________
Denise Richardson
Hollywood, FL
deniserichardson1@netzero.com

 

Thank you for your responses and I appreciate the debate. You are so right about what happens when the servicing of our loans fall into other entitys. If you haven't seen Richardson V fleet, et al than you should. It all began by paying additional principal payments which is my right to do in order to pay less interest over the course of the loan. However, their bookeeping errors grew to the magnitude where nobody could figure out the actual amount due.

I had all the cancelled checks (Which we now no longer get with our statements) and each time the payment history statement I ordered came in, my payments I made early (i.e a Feb. 1st payt. paid on Jan. 23rd) were applied in many instances as a late payment for JAN. with a late charge applied to my balance. What this meant was each month, I was paying higher interest than I should...AND the amount due to go to principal from my payment was applied as a late payment so therefore...NO principal was being applied whatsoever.

Had I not discovered this, the term of my loan would not only be extended (without my knowledge) but I was paying much more interest than I should have, simply due to their seriously flawed system of bookeeping.

Eventually, due to their inability to carry out their duty to pay my mortgage, several years of battling had to take place. Then they paid off my mortgage and in settlement, agreed it was their errors and they would never adversely affect my credit. The bank was known as Shawmut Bank then.

Incredibly 11 months later after the loan was paid and discharged. I received a call from the NEW bank (Fleet) whom they had merged with telling me they were foreclosing as I hadn't paid my mortgage.

After numerous letters, testifying in Boston in support of monthly statements and letters received all promising me they were "fixing" the adverse "mortgage write-offs placed erroneously and in bank error on my credit...I was contacted by a collection company that they had sold this non-existent debt to. That is when I initiated the Federal suit, but only after years of exhaustive attempts to get my credit repaired which was destroyed by their ongoing errors.

I only relay all this to you so that you can see the importance of monthly statements to those of us who like to take advantage of our no pre-payment penalty loans by paying additional principal, and those of us who KNOW first hand that bookkeeping errors do happen and CAN grow to a magnidute that you would never understand unless you have seen it with your own eyes.

Additionally, it isn't just the additional principal that we need to worry about. What about being charged late payments when your payment isn't late...what about addtional principal payments either being applied as paid in advance (as mine were) or placed in escrow where you don't get the benefit of earned interest credits?

I understand that you don't want the additional "paper" but you could opt out of the monthly statements and allow the people that want them their right to verify. Not everyone has a computer and not everyone trusts doing banking on line. Those people should be allowed to receive "receipts" aknowleding where there money went without being a non-paid employee and contstantly checking their "work".

HUD not long ago estimated that over 1.5 Billion dollars had to be returned to cunsumers due to mismanaged escrow payments! That is why they now mandate lenders disclose to their consumers how much they are holding in escrow. If escrow payments were mishandled to the tune of 1.5 BILLION dollars, can't you believe there are other mishandled monies? Who else do we pay that kind of money to and not expect proof or a checks and balance system. That's all were asking for. The lenders corporations are enormous and constantly merge...they all have a net worth more than you can ever imagine. They can afford monthly statements.

If they can afford them in MA, where they voluntarily agreed to send their consumers monthly statements after hearing from the banking committe of their enormous concern for their continual bookkeeping errors, then they can offer us the right to verify through monthly statements, if we wish, in all states. They just didn't offer to voluntarily send monthly statements, until the heat was on them. No interest rates were increased due to monthly statements being offered as you suggested.

I support your right to opt out and verify monthly on your computer as to where your payments go. I also support your right NOT to pay additional principal payments. I am just asking for your support in our right to verify how our payments are being applied.

Those of you that do support this effort, please take a moment to sign the petition.
You can find it at http://www.ipetitions.com/campaigns/monthlystatements/

or just go to http://www.consumercity.org and click on Ban Coupon Books.


Thanks... Denise

 

ontrack....I could not have said it better!! Thanks!!!

 

ontrack..thank you for providing the link to the FTC site. The Fairbanks complaint speaks VOLUMES to what I have been saying. The consumers were not and are not aware that this happens. Now Fairbanks is paying back 40 million dollars to consumers...do people really believe they are the only lender with this type of either bookkeeping negligence or illegal activity (as the FTC put it) or the only ones tacking on charges that consumers are not aware of? I think that everyone that does not get a monthly mortgage statement reflecting how their payments are applied....needs to read this case before they can come to a conclusion that we don't need to verify how our payments are handled!!

 

Thanks Ontrack...I will check it out...have you seen http://www.msfraud.org a very good site.