Sunday, April 19, 2009

Burn That Mortgage!

My wife and I are approaching a major financial milestone. By our calculations, we will pay off our mortgage next month. My boss says we should have a mortgage-burning party. But wait.

We got mail from our bank, also our mortgage holder. I was hoping it was information on our escrow, which I assumed must have a major surplus since our property taxes are due this summer and haven't been paid yet. Ordinarily, this would be paid out of our escrow which we contribute to every couple weeks. But once our mortgage is paid in full, that property tax bill of several thousand dollars would be our's alone to be paid at once. The city doesn't let us do monthly installments.

When I opened the envelope, however, I was in for a rude awakening. It was a coupon booklet to continue making mortgage payments, enough for another year or more. What's the problem? Can't banks do math anymore?

Booklet in hand, Wendy and I marched over to our local bank. We were determined to speak to someone face to face and clear this up. Is anybody out there chuckling over our naivete? Let me repeat, we wanted to speak to someone face-to-face about our outstanding home mortage.

So we were in for another rude awakening. Among the over half-dozen branches our bank has in the Ann Arbor metropolitan area, there's apparently only one official home mortgage officer. We were welcome to make an appointment to see him. An appointment?!

Our second option was to call the "customer service" department at the local branch which we did. The representative quickly told us that she couldn't help us. Her records didn't even show our loan because it was so old. So now we were at option three, the dreaded 1-800 number.

I called that and spoke to a lady who sounded so young I felt she had to be an intern from the local high school. When I told her that we had not received our yearly escrow statement, she checked and enthusiastically informed me that they were to be mailed out next week. And that we were $175 short in our escrow. And that our monthly payments would reflect an increase . . . starting in June.

I replied that my calculations showed that we would pay off our mortgage in May. And we didn't even make monthly payments. We were on a bi-weekly payment program. I was put on hold. Apparently she had to check something with her supervisor.

Back on the line, she said that I appeared to be correct. But this "accelerated equity" payment program was run through a private third party, so she couldn't verify that. But wait a minute. We didn't sign up through any private third party. This bi-weekly payment was deducted from our bank, from our account, to pay for our mortgage which was also administered by our bank.

Back on hold while she checked again. She returned to say that this payment program was "affiliated" with our bank, but was run out of a different location and she would have to transfer me to another number. Fine. Do it.

A young man by the name of Carlos with a thick Latino accent answered. He asked me for my ten-digit loan number which I gave him.

"I don't have any loan for that number," he said. I read it to him again. Still nothing. He asked me for my phone number. I gave him that.

"I still don't see any loan for you. What is your name?"

I gave him that. He still didn't see any loan. I gave him Wendy's name. Nope, nothing there either. He said he was going to transfer me to another location, one which handled a different type of "accelerated equity" payment program. That's when I got cut off. And I gave up.

Maybe somehow my bank got mixed up and sold my loan to the government as part of this "toxic asset" bailout being handled through the Treasury Department. Maybe that would be a good thing, maybe not. It depends on whom I would rather be handling my mortgage--someone like Carlos, or the government.


Blogger Fred said...

No wonder this country's banking system is such a mess. The banks can't even keep track of their own assets. I would camp out in the bank manager's office until I got a straight answer.

It'll be interesting to see how this works out. Keep us posted.

12:26 PM  
Blogger Carine said...

I agree-banks have no idea what they're doing. We decided that since we too were almost done w/ our loan (not as close as you Dave, but about 5 years away), but our 2 main bathrooms are in desparate need of repair/updating and w/ the son's wedding coming up and our part needing to be paid for, we decided 3 months ago to refinance our loan to cover all that we needed to do.

We've done our part, but the bank-well, they seem to be doing the "round robin dance". no one seems to know who's supposed to be doing what to finish up the paperwork!

Luckily, the toilet's work (although my tub is leaking)and the ceremony isn't for another year.

Hopefully, they figure it out long before then.

12:37 PM  
Anonymous cassie-b said...

How frustrating! I assume your figures were correct and they'll straighten the problem our some time in the next (hopefully) days.

4:42 PM  
Blogger Big Dave T said...

FRED--I thought the same thing. I wondered if maybe if some of the millions that banks spend on bonuses could be used to hire more customer service staff. Or provide more training anyway.

CARINE--I'm honestly a little more surprised at your bank situation. When I asked the bank about a home equity loan about a year back, they wouldn't leave me alone. Even called me at work. I guess with the financial problems banks are going through today, they're not as eager to close the deal.

CASSIE--I'm pretty sure our numbers are correct. But just in case, we're going to make sure we leave enough in our account to cover a house payment come June.

3:51 AM  
Blogger Kacey said...

Oh Dave, you are so good with words... let your next writing effort be an epistle to your local television station's hot line. Get them working on this....I can see the headlines now...."Honest Working Man Screwed by the Bank Bailout", but they will help you with your misery.

2:31 PM  
Anonymous Anonymous said...

Kacey, Don't let his head get any bigger please.


His family

6:30 AM  
Blogger Lynilu said...

I .... hate .... mortgage .... companies. There is nothing, NOTHING that goes easy/straight/right with them. Good luck!

2:21 PM  
Blogger Lucy Stern said...

Dave, I wouldn't waste any time finding out about your loan...Call Carlos back and go from there....You should get a refund on your escrow account...Take that money and put it in a special account and start adding monthly payments for your estimated taxes.... You will also have to set aside money for your homeowners insurance too. My sister paid off her house last November and she is putting $ 500.00 a month into a special account to cover all that

FYI: NEVER take out a home equity loan...If you default on this type of loan, the bank can take your house from you...... People don't know how this type of loan works. You are basically putting your house up as collateral for the loan....Anything that happens, and the bank can take it...

Good luck, now get to work...Call Carlos....BTW: Carlos is a better option, hands down, than the government.

9:56 PM  
Blogger Big Dave T said...

KACEY--Thanks. It helps when bureaucracy inspires me with such good material for my blog. You're right, maybe my next writing effort should be to the local newspaper or something.

ANONYMOUS--No, you're not my family. I checked and they didn't make this comment. My family knows I'm just a humble guy living the average life here.

LYNILU--I can tell you this. It will be my last mortgage. Once we get this one paid off, there won't be another.

LUCY--The problem is that I don't have Carlos' phone number. When the lady at the 1-800 number transfered me to him, she didn't give me that number. So I don't have it.

And I have no plans to take out a home equity loan. God forbid I would ever need one.

9:17 AM  
OpenID caroldee said...

would not give me any info on my own damn acct. grrrrrrrrr I hate them. Hope it all goes well anyway : )

10:28 AM  
Anonymous Enforcer said...

These are the sort of things that bring out the ENFORCER in me, rahhh!

4:54 AM  
Blogger Nankin said...

Dave, how annoying when the norgage company can't even get it right. I wonder how many have actually paid off their house, but go on making payments because they can't get a straight answer.

1:13 PM  
Blogger jan said...

During the course of my mortgage I was sold to eight different mortgage companies. And they were all stupid. And rude. It must be a requirement.

2:01 PM  
Anonymous Anonymous said...

Take your medicine, Enforcer.

2:01 PM  
Blogger Big Dave T said...

CAROLDEE--Maybe a bunch of us ordinary folk can just form our own bank. Big Dave's Bank. If I can get the FDIC to insure it, I'll give it a try.

ENFORCER--If I do start my own bank, I'll make sure your account gets special attention. Maybe you can be my security guard.

NANKIN--Although we're pretty sure our mortgage will be paid off next month, we're going to keep enough money in our account to cover another payment in June, just in case. But if they DO take out another payment in June, I'm going to have the Enforcer here go after them.

JAN--I think that happened with our mortgage. And the mortgage went one way while the outfit we paid it to went somewhere else, I'm not even sure where.

ANONYMOUS--I wouldn't pick on the Enforcer. I hear the only medicine he takes is spinach.

9:13 AM  
Anonymous Enforcer said...

Does that job include a Bonus?

7:37 AM  
Blogger Betty said...

Oh, brother. This is scary. I've been checking the progression of my mortgage payoff online, but I'm now realizing that I may be deluding myself by assuming that I know what's going on. And I'm worried that they didn't keep track of all the extra principal payments I made. I'll be dialing that 800 number tomorrow!


7:53 AM  
Blogger Big Dave T said...

ENFORCER--I could maybe be tempted to throw in an extra twenty bucks. But no buyouts! Those types of deals can bankrupt a company.

BETTY--We get a different principal balance on-line than what we get in our escrow, which is different again from what we can in our yearly bank statement. Hopefully you'll have better luck figuring it all out.

12:42 PM  
Blogger Peter said...

Good luck with the Bank/Mortgage Dave BTW I'm late... its May now, hope you still have a home.

5:40 PM  
Anonymous Anonymous said...


10:42 PM  

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