My story comes from the other end of the foreclosure spectrum. I own my condo, free and clear. I have an EXCELLENT credit rating. I live within my means, save money, pay my bills on time.
And do I think there is mortgage fraud going on in the USA? Predatory lending?
OH, HELL YES.
This is my story with Bank of America. It is probably not typical, but it sure made me aware that we have a serious problem going on with financial institutions in this country.
My story below.......
I have been financially self-sufficient since before my 18th birthday. And years before that, I earned the money I needed to buy many personal items, like all my clothes. That’s what happens when you come from a large family without a lot of money. If you want something, you work for it, because no one is going to hand it to you.
I worked my way through college back in the 1970’s. I bought, and sold, a house back in the 1980’s, and also worked my way though graduate school back then. When all was said and done, I had $7,000 in student debt and paid that off when I sold my house to move to Ontario.
For years after that, I was a renter. That was mainly from a personal choice, not a financial one. I either felt I didn’t like my job, or didn’t like the area I was living in enough to buy property. So, I rented.
I stayed single, and I have no children. When I got a job I liked in a town I really loved, I decided to buy. This was July 2000. At first, I had a real estate agent, but he kept showing me homes that were more than I wanted to spend. I wanted to stay well within my means, which meant that the price of the home would only be double my annual salary.
I had the money for a 20% down payment. I had an excellent credit score. I had no other outstanding debts, and a sizable amount in retirement funds (which have since gone down considerably, but that is due to the stock market, not the housing situation). As you can tell, I speak English, am well educated, and hired a lawyer back in July 2000 when I bought my condo. I had a fixed interest 15 year loan from Bank of America. I made an extra principle payment of $250 each month.
I did everything CORRECTLY.
Two years later in October 2002, I decided that it would be to my financial advantage to re-finance at a lower rate. Again, I had a lawyer, and I made sure (like the first time) that there were NO prepayment fees for paying it off early. I went for a 30 year loan (adjustable after five years) that had a fixed amount that the interest rate could be raised. This was my idea – because I was thinking that I could pay off the loan before the interest payment went up. I made an extra principle payment of $250 each month.
So far, so good. All went according to plan, and Bank of America automatically took out my payments from my checking account. Bank of America NEVER passed on my loan to someone else – I was too good of a credit risk to share the mortgage with anyone else or to sell or re-sell the mortgage in a mortgage bonds. I really didn’t know that these things were happening, because they never happened to me.
So, in August 2007, just a couple of months before the interest rate was due to re-set, I went and paid a considerable lump sum to pay down my mortgage. I paid it at a local Bank of America office. They cashed that check. Then they spontaneously decided to stop withdrawing the monthly mortgage payment from my checking account. They never contacted me.
And I had a hell of a time contacting them.
I went into the local office where the loan originated, but they didn’t/woundn’t do anything about it. They put me on the phone to someone in another city. This was the first of MANY phone calls over the next few months, trying to get Bank of America to re-start deducting my mortgage payments from my account. I would talk with someone, do a check-by-phone for the missing payments, and sometimes it would be deducted from my account. Sometimes, it would not. Apparently, Bank of America decided (all on their own and without informing me) to take that lump sum I had given them in August and apply it to principle, escrow and interest payments over the next eight months. After several phone conversations, I got that lump sum applied to principle.
But they still did not start regularly deducting monthly payments from my account until December. And, unfortunately for me, they applied the payment in December to someone else’s mortgage in December. And, they had applied the check-by-phone payments to someone else’s account also. I did not know that because I had never received monthly statements from them.
And – each and every time I called them (several times a month) one of the first things they asked me was if I was in foreclosure. I found that upsetting.
And then one day in December 2007, I got a letter from them saying that they were going to report to the credit bureau that I was behind in my payments.
Just four months after making a huge lump sum payment --- and after a dozen phone calls to get them to start up the monthly deductions that they unilaterally decided to stop --- they are accusing me of missing payments!!
One thing I did learn from this – insist on a monthly paper statement from Bank of America. That made it easier to track what those incompetent (or criminal?) folks at Bank of America are doing.
On New Year’s Eve in 2007, I finally got on the phone with another Bank of America person who seemed to grasp what had been going on, and that started the process of getting it straightened out. It only took me over four months to achieve this end. And I found this ordeal rather upsetting – not that they cared.
In the fall of 2008, I paid off my mortgage. It turns out that you cannot pay off a mortgage with a check-by-phone – no, the precious dears at Bank of America have to have the money WIRED to them. They have returned my escrow funds and issued a letter saying the mortgage is paid in full.
I am free of Bank of America and own my home free and clear.
My home, by the way, is still worth more than what I paid for it in 2000. I live in a popular area. This is not true of a lot of other people’s homes.