This should be the happy coda to my long mortgage refinance
story, but it's not. Why? As they say, denying all responsibility,
"Mistakes were made."
Mistake #1. Despite receiving the hazard insurance on our home
when funds were disbursed after the closing, our insurance company went ahead
and billed our new mortgage servicer all over again.
Mistake #2. Despite it being uncommon not to prepay out of
already accrued escrow such things as home insurance during a refi closing, and
despite having its own copy of the closing papers, our new mortgage servicer
paid the double bill without questioning it, thus completely depleting our
escrow.
Mistake #3. I sent a large check, separately from the regularly
monthly mortgage payment, specifically designating it to be applied to
principal only. Instead, the new mortgage servicer decided to apply it to our
next month's regular mortgage payment.
Mistake #4? We gave up waiting for the invoice for the mortgage
payment due July 1, so we sent the payment anyway. What are the chances that
the mortgage company decides to credit it to the wrong month's payment? Or the
now negative escrow? Or who knows what?
Mistake #5. When our insurance company received the excess
payment, instead of questioning it, they applied it to our car insurance bill,
which wasn't due for another month, and was for a different amount. Then they
sent us a refund check for the difference, without any explanation.
Mistake #6. Well, that's still to come.
A lot of people are working for companies so large that they
can't even begin to challenge an incorrect communication such as the double
billing from the insurer. Despite demanding that I recite my name, address,
telephone number, and e-mail address over and over during every phone call,
these companies never bother to pick up the phone or shoot me an e-mail and
ask, "Hey, what's up with this? Seems a little odd." I'll say it's
odd.
These employees are not being paid to get things right.
They're paid to get the money, or pay the money out, but never to think about
what the transaction means. It would be sad if it weren't so frustrating for
all concerned. The only redress the insurance company offered was to send us
the car payment as a refund, which of course we would then have to turn around
and pay anyway next week. The jury's out on whether the mortgage company will
credit our extra payment to principal, or try to weasel out of doing that based
on stupidly paying the double insurance bill. And eventually, we'll have to cough up roughly the amount of our car payment to rebalance the escrow.
What a mess.
This is yet another reason that some people are willing to
stay with their old, overpriced mortgage, rather than fall into the hands of an
incompetent company. Or in this case, two incompetent companies.
What can we learn from this experience? Not much. Keep on
top of your bills. Pay attention when they don't show up on time. When random
checks arrive, find out why. And be ready to spend a lot of time on the phone
straightening things out. You are the only one who can. You're also the only
one who cares.
***Hilarious update.***
Out of the blue, five years after the Refi That Took Forever, we received a substantial check (over $1,000) as our part of a class action suit that someone had filed against our mortgage company. I guess others were shrewd enough to see through the mortgage company's double-talk and realized that we all were being overcharged.