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Years ago, I bought a house with the best mortgage deal I could find at the time. When I moved into the house, I opened checking and savings accounts with Bank X, as it was convenient and close to my new house. At the time, I had other bank accounts (credit union and Bank Y). After several years, I noticed that the rates and services offered by Bank X were inferior to the rates and services offered by my credit union and Bank Y. However, I kept my accounts at Bank X open because Bank X was nearby, convenient, and I was lazy.
It bothered me a bit that Bank X’s rates and services were not as good as the others, but what changed was that the bank staff grew increasingly frantic about pressuring me to switch my personal financial services account and retirement planning from my years-long fiduciary financial planner to Bank X services, which seemed to me to be primarily based on extracting as much as possible from the customer to boost the bank’s profit margins. The bank staff were so relentless about it during each visit that I grew uneasy and closed my Bank X accounts.
About a year ago, my mortgage was purchased from the original company by Bank X. Now I find that my mortage account logon no longer works. In its place is an announcement that mortgagees must open bank accounts with Bank X in order to access and manage their mortgages.
I originally closed my accounts with Bank X because I found their business practices unsettling. This latest action has heightened my concerns considerably. I believe my best alternative is to cash in my brokerage accounts in order to pay off this mortgage. But, I think that holding my mortgage hostage in order to blackmail me into reopening bank accounts and tying up thousands of dollars with Bank X (in order to avoid high monthly fee charges) is unethical. I suspect I should report it.
Note: Bank X is a national bank. No, it’s not Well Fargo. I think Bank X is equally questionable but has not (yet) had the same bad publicity.
I am sure taking my mortgage hostage is not ethical. Is it legal? Should I report it? I know that people may have emotional responses. Can anyone with bank experience advise me on the legality? I think that I should start with reporting to the Federal Reserve. Am I out of line? If not, what other reporting should I do? BBB?
Your mortgage has hardly been "taken hostage" because they won't offer you online access. There is absolutely no requirement I've ever heard of for a bank to have online access for any account at all. It's a courtesy, a service and a competitive element... not a Fed-required mandate.
I can't imagine much use for online access, anyway. Once past the initial stages, it's a matter of making a fixed payment at monthly intervals for decades. What is it you're checking with such urgency?
I watch my mortgage as that is the only liability I currently have. I pay extra principal in dribs and drabs so I can reduce the overall length of the mortgage and total interest. I was very upset by the change but thought perhaps I was overreacting, which is why I asked for other people's opinions. Thank you for putting it in perspective.
I watch my mortgage as that is the only liability I currently have. I pay extra principal in dribs and drabs so I can reduce the overall length of the mortgage and total interest. I was very upset by the change but thought perhaps I was overreacting, which is why I asked for other people's opinions. Thank you for putting it in perspective.
It's nice to have instant access, but if it's not worth maintaining a (probably free) account with the bank to get it, you aren't losing much. It's such a long-term, slow, unchanging obligation that the statements should contain all the timely info you need.
I watch my mortgage as that is the only liability I currently have. I pay extra principal in dribs and drabs so I can reduce the overall length of the mortgage and total interest. I was very upset by the change but thought perhaps I was overreacting, which is why I asked for other people's opinions. Thank you for putting it in perspective.
Would refinancing with another bank (your bank Y, maybe) be an option or is the interest rate you now have lower than what is currently available?
If bank X will not allow you online access it should provide you with a monthly statement by snail mail.
Would refinancing with another bank (your bank Y, maybe) be an option or is the interest rate you now have lower than what is currently available?
If bank X will not allow you online access it should provide you with a monthly statement by snail mail.
Interest rate is at almost par with current rates but about 0.5 % above. I only have online access to my account, no snail mail Need online access to change to snail mail. So, instead, I will go down to Bank X and see what I can do about that.
This has solidified my intent to cash in retirement investment accounts to pay off that mortgage. I have put that off because I appreciated the mortgage interest deduction but am no longer convinced it's worth it.
This has solidified my intent to cash in retirement investment accounts to pay off that mortgage. I have put that off because I appreciated the mortgage interest deduction but am no longer convinced it's worth it.
I think you are overreacting about the bank. Banks buy and sell mortgages all the time. As others said, your need to access that account is pretty minimal.
As for paying off the mortgage, remember, if you can't replace that cashed in retirement investment quickly from some other income source, just consider that you won't be able to pay post-retirement living expenses with your house unless you can sell it. Who knows what you could get for it then? Don't forget that taking a chunk out of an investment account not only lowers the actual accrual you have, but it also lowers the account's leverage for quite a while. You could also be assessed fees/penalties for taking an early withdrawal. No way to get that back. Add it to the "cost" of paying off the mortgage.
That mortgage interest tax deduction is only a benefit if the amount is higher than your standard deduction would be. If you carry the mortgage long enough the amount of interest you paid during the tax year will probably drop below the standard deduction.
Last edited by Parnassia; 01-26-2019 at 02:14 PM..
Interest rate is at almost par with current rates but about 0.5 % above. I only have online access to my account, no snail mail Need online access to change to snail mail. So, instead, I will go down to Bank X and see what I can do about that.
This has solidified my intent to cash in retirement investment accounts to pay off that mortgage. I have put that off because I appreciated the mortgage interest deduction but am no longer convinced it's worth it.
I would be very surprised if your investments are not earning more than the interest you pay on the mortgage. I would think twice about cashing them in.
i wouldnt be happy if i couldnt get online access to my mortgage but it isnt the kind of thing that is worth making a money losing move about.
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