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OK, before you say anything, yes, all kinds of people are looking into this for me (as well as me) ...
Hit turbulence, applied for a modification (late March, sent follow up documentation early May), started sending in partial (60% payments) for 6 months. Just called the mortgage company (Wells Fargo, ugh) and they say I am 6 months behind; I figured I would be 3-4 months behind if they pooled the partial payments into full payments.
[I finally got a job 6+ months ago and just put my heart and soul into that, figured the job, the modification, other money coming in would all come together; I won't apologize again for being frozen, afraid to open the mail or call the company)].
My house is going on the market tomorrow or the next day (via a realtor, not auction or anything like that), cleaning frantically, etc.
I figured I would be 3-4 months behind if they
pooled the partial payments into full payments.
I have a mortgage with Wells Fargo.
I go on line every month to see that my payment(s) have been properly credited to
my account, escrow, taxes, insurance are all being taken care of -- stuff like that.
"I figured" <<<---???
You have been cruising for six months and have not looked even once?
For shame.
Quote:
Originally Posted by blossom4792
What's the advice?
Sell and rent.
Most people with a mortgage are really just renting anyway now.
It is possible that because the payments were not enough to cover the full payment, that they were mistakenly applied as "principal only" payments and not applied to the payment currently due. In that case, yes, you would be 6 full months behind, plus late fees, penalties and interest. My guess is that is what has happened.
I agree with mortimer though. WF has excellent online banking. I check my mortgage there every month as well. There is no excuse to not have done this, or even to do this NOW and find out where your money has been being applied.
A mortgage servicer is never going to apply payments reducing principal when the interest payments are behind... In fact, they most likely will apply the partial payments to fees even before interest - with the fees increasing each month. So what you're likely getting yourself into is going nowhere... including having your credit already being impaired as you haven't technically been current since your first partial payment.
How you haven't verified any or all of this with the servicer boggles my mind.
A mortgage servicer is never going to apply payments reducing principal when the interest payments are behind... In fact, they most likely will apply the partial payments to fees even before interest - with the fees increasing each month. So what you're likely getting yourself into is going nowhere... including having your credit already being impaired as you haven't technically been current since your first partial payment.
How you haven't verified any or all of this with the servicer boggles my mind.
Yes, but if they have been doing this for 6 months, they shouldn't be a full 6 months behind. SOME of the payments should have gone against interest, at least. My statement says that my late payment penalty is like $35. So most of the 1st month's payment should have been applied correctly to that month, and the 2nd month of partial payment should have just about cleared the 1st month, with penalties. After that, things would go downhill quickly. The next 4 months should have just about covered penalties, interest and another month's payment. If the 60% payments were being applied to the interest and penalties, he should only owe around 4 months worth of payments, like he said, not the full 6.
That is, if you missed Oct 1st's payment, you have a $100 penalty.
If you miss Nov 1st's payment, then it's $100 for Nov and
an additional $100 for Oct and so on.
With that system, if you were six months late, you would be getting
dinged for $600 on the six month *and* you would be
in arrears on $1,500 in late fees for the previous five months.
I just don't know, but it could get ugly real fast.
That is, if you missed Oct 1st's payment, you have a $100 penalty.
If you miss Nov 1st's payment, then it's $100 for Nov and
an additional $100 for Oct and so on.
With that system, if you were six months late, you would be getting
dinged for $600 on the six month *and* you would be
in arrears on $1,500 in late fees for the previous five months.
I just don't know, but it could get ugly real fast.
This is exactly what I'm saying... My mortgage book always had 2 numbers ($X to be paid by Y or $[X + penalty] paid after). Even disregard to fees, you owe more interest by being late. This type of stuff is calculated down to the day (like they do at closings).
Even well into the middle of a 30 year mortgage, the amount of the payment applied to principal is pittance. IMO, it's entirely possible that being short 40% of the first partial payment missed enough interest due plus fees that is still accruing even 6 months later. i.e. even that 1st payment is still "late".
If there's any lesson here it's that you should probably never submit partial payments without speaking to your servicer.
This is exactly what I'm saying... My mortgage book always had 2 numbers ($X to be paid by Y or $[X + penalty] paid after). Even disregard to fees, you owe more interest by being late. This type of stuff is calculated down to the day (like they do at closings).
Even well into the middle of a 30 year mortgage, the amount of the payment applied to principal is pittance. IMO, it's entirely possible that being short 40% of the first partial payment missed enough interest due plus fees that is still accruing even 6 months later. i.e. even that 1st payment is still "late".
If there's any lesson here it's that you should probably never submit partial payments without speaking to your servicer.
That's more than a probably! That's a definitely! Never ever make less than the full payment without contacting your servicer. They're not mind readers.
You are not going to roll a due date unless you make the entire P&I portion of your payment. The servicer can choose (again with communication with you) to accept a P&I only payment and let you short your escrow account temporarily.
If you are in a loan modification trial pay program things are a little different.. but it doesn't sound to me from the OP's wording that they were ever officially accepted in the program, just that they sent the application paperwork back. You definitely need to follow up on that and make sure you're in a trial pay before you send in smaller payments.
OP should definitely get the bank to give a complete transaction history to see what happened with those partial payments.
There really is no need to have "multiple people looking into this" for you. Just log on to the Wells Fargo online banking, pull up your mortgage, and look at the payment history. It is all there in black and white. It shows penalties charged, payments made, principal payments made, even tax and insurance payments made, and how much is in your escrow account. You can look at every payment and see how the money was applied. For example, if I pull up my October payment, it shows me that I paid $WWW total, with $XXX applied to interest, $YYY applied to principal and $ZZZ applied to escrow.
You can also pull your past statements online, since you say you were afraid to open your mail (I don't understand this. Opening your mail doesn't hurt anything. Always better to know than not to know. And if you were trying to do a modification, opening your mail would be a GOOD IDEA. If you are behind on payments, the worst thing you can typically do is avoid/ignore the problem). The statements show exactly how each payment was applied and what the current balance outstanding in each category on that date.
You say "ugh" about Wells Fargo, but I have found them to be one of the more responsive banks when it comes to Short Sales, Foreclosures, etc., and their online banking makes it very easy to track your payments, but you have to do your share.
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