Does this sound like predatory lending? - Loan Modification Forum

amn33 · 09-20-2008, 12:23 PM

We refinanced with Countrywide a couple of years ago. Throughout the process we were assured, because I insisted on it, that an escrow account would be created and our final monthly payment included funds for the escrow account. It was nearing the end of the month, so we were pushed to settle before the end of the month to keep our rate. They sent the paperwork to our house and sent a notary over on the last day of the month at night time. As we were signing the paperwork we found out that an escrow account was not set up. We called our loan agent and was assured that there would be no extra cost and that it would be easy to correct later. Trusting this, and not having a broker or real estate expert there to help us, we went ahead and signed. When we finally did get with Countrywide about the escrow account we were told that to fund it they would need a lump sum, I don't remember the exact amount right now, but I think it was around $2000. In addition to the lump sum our mortgage payment went up about $467 a month. Since then we have had to use credit sometimes to make ends meet, bringing our credit card debt up. I could go on, but right now I just want to check on Countrywide's actions and if I have any recourse. We are currently behind in our mortgage and possibly facing foreclosure soon. I would very much like to keep our home and am trying to find ways to do that.

Thank you for any help.

Moe Bedard · 09-20-2008, 12:50 PM

What you described would not be considered predatory lending............however if they were holding funds that you paid to set up escrow accounts at closing ie...approx. 6 months taxes up front at closing and 1 year of hazard insurance, and they are showing on your HUD1 that way, you could file a complaint with HUD for RESPA violations

It is the lender's decision whether the borrower must maintain an escrow account for the purpose of paying taxes and other items. It does not have to be set up at closing, but if it is set up at closing, you will be required to pay an initial amount for each of these items to establish your escrow account.

Does it state on the HUD that you paid those items into an escrow account at closing?

09-20-2008, 12:23 PM	#1 (permalink)
amn33 Junior Member Join Date: Sep 2008 Posts: 1 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Does this sound like predatory lending? We refinanced with Countrywide a couple of years ago. Throughout the process we were assured, because I insisted on it, that an escrow account would be created and our final monthly payment included funds for the escrow account. It was nearing the end of the month, so we were pushed to settle before the end of the month to keep our rate. They sent the paperwork to our house and sent a notary over on the last day of the month at night time. As we were signing the paperwork we found out that an escrow account was not set up. We called our loan agent and was assured that there would be no extra cost and that it would be easy to correct later. Trusting this, and not having a broker or real estate expert there to help us, we went ahead and signed. When we finally did get with Countrywide about the escrow account we were told that to fund it they would need a lump sum, I don't remember the exact amount right now, but I think it was around $2000. In addition to the lump sum our mortgage payment went up about $467 a month. Since then we have had to use credit sometimes to make ends meet, bringing our credit card debt up. I could go on, but right now I just want to check on Countrywide's actions and if I have any recourse. We are currently behind in our mortgage and possibly facing foreclosure soon. I would very much like to keep our home and am trying to find ways to do that. Thank you for any help.

09-20-2008, 12:50 PM	#2 (permalink)
Moe Bedard Founder Join Date: Aug 2007 Location: Southern California Posts: 16,887 Nominated 0 Times in 0 Posts TOTW/F/M Award(s): 0	Re: Does this sound like predatory lending? What you described would not be considered predatory lending............however if they were holding funds that you paid to set up escrow accounts at closing ie...approx. 6 months taxes up front at closing and 1 year of hazard insurance, and they are showing on your HUD1 that way, you could file a complaint with HUD for RESPA violations It is the lender's decision whether the borrower must maintain an escrow account for the purpose of paying taxes and other items. It does not have to be set up at closing, but if it is set up at closing, you will be required to pay an initial amount for each of these items to establish your escrow account. Does it state on the HUD that you paid those items into an escrow account at closing? __________________ Moe Bedard Founder LoanSafe.org "America's #1 Home Loan Forum" LoanWorkout.org "America's # Loan Modification Blog" Get My FREE Loan Modification E-Book \| Please donate to LoanSafe.org \| Loan Modification Training For Attorneys \| Rate Your Mortgage Servicer The comments by me and the materials available at this web site are for informational purposes only and not for the purpose of providing legal advice. Most of the information you find here is easily available on the internet. You should contact your attorney to obtain advice with respect to any particular issue or problem. The opinions expressed at or through this site are the opinions of the individual author and may not reflect the opinions of the firm or any individual attorney. Please Read our Privacy Policy and Legal Disclaimer Here.

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