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.