Cash bill payment problems

[Clay3007]

So today we ran to the cu where our second mortgage was to make the payment, (arrears payed by trustee, but we still have to make the normal payment). Pull up to atm and talk to lady. She wont accept cash as payment but wont tell me why other then a memo on account. Pull around and go inside and another teller wont accept it due to memo. Im irritated because i cant pay the same way i have been for the past 24 months but no one will tell me why. So i demand info and finally a manager come out and says they changed the policy last month because they have to mail a check to another branch that handles delinquent accounts. I don't want to pay with a damn check! I called the attorney but it was after 4:30 so that will be a Monday ordeal. No one ever notified us of this change from the trustee, attorney or credit union.

[justbroke]

Sounds like it's the credit union (CU) itself with this new policy. It will be interesting to read about what your attorney thinks, but I don't think there is much that can be done. Since the Trustee normally mails checks this would not affect them as this doesn't appear, to me, to be a material change to the terms of the mortgage and note itself. It would have been nice if the CU contacted you, but they have to be careful with contacts. I think they dropped the ball by not notifying you personally that they'll no longer accept cash payments at that branch.

Now, what is puzzling is that they "have to" mail a check to another branch... of the same credit union? Now that sounds really strange, but it's likely their own internal processes that are broken. Not speaking about all credit unions, but most CUs don't have the most sophisticated banking systems. Many of them used shared infrastructure (systems) and some have really old antiquated and outdated systems. It's unfortunate but it reads as though they've been having some accounting issues and prefer the "paper trail" so to speak.

Since your account is technically in arrears, they are likely adjusting to how the policy should apply. Usually, a bank would not accept any payment for less than the current amount due. So it could be causing issues with how the bank accounts for things internally.

I hope that you're keeping good records. It is highly likely that you'll have post-discharge issues with your lender. We were just talking about mortgage fees and balance issues in another thread. Chapter 13s can wreak havoc on a bank's internal accounting systems that are (or were) not designed for bankruptcy. Those systems were designed to charge late fees, prohibit "partial" payments, and generally not deal well with payment fluctuations.

Here's the link to the other thread. It started as payments by and through the Trustee but ends with Chapter 13 discharge issues related to mortgage payments.

https://www.bkforum.com/forum/before...se#post1025955

[despritfreya]

I get that you want to pay in cash - presumably getting a written receipt at the time of payment. But. . . I don’t understand why issuing a check each month is so disagreeable to you. In fact, having both a multiple paper trail (bank statement - cancelled check) and an electronic receipt (if the ability to see statements online has not been cut off) is much safer in tracking payments than one piece of small paper that entails a written receipt (that can be lost).

Personally, I pay my mortgage by personal check. I keep a photocopy of each check and send each payment by Certified Mail Return Receipt Requested. Every month I set aside the photocopy of the check, bank statement that shows the check was cashed and the signed green card, keeping all evidence of payment for that month stapled together. I have done this every month for 20 years. The lender will never be able to assert that I missed a payment. If it ever did, my response would be “what month”. Then I would go to my file and pull all the paper details and have some fun.

Keep the best detailed records as possible and don’t fret about a lender’s internal decision as to how it handles an account when the borrower files bankruptcy. So long as you make the payments and can prove such, what does a little inconvenience matter?

Des.

[Clay3007]

Our payments post filing are current but every month when i pay it says my next due date is from 3 months ago, i hate checks with everything being paid by debt card or cc these days checks are so slow. I usually pull money out of every paycheck and leave it in our safe and drive to the cu and make the payment and then put the receipt in the file so i have a hard copy that i paid that month. The cu said they changed it last month on the 16th well looking at my past payments i made a payment on the 16th last month! No word was said, Since we filed we have worked out a great budget and stuck with it, i guess im more irritated of the lack of communication from everyone and the because of the automatic stay the bank wont/cant talk to me but the attorney is closed until monday.

[justbroke]

I think that your attorney is going to say something similar to what we are saying here. It is frustrating for them not to be able to accept a cash payment at any branch. But, because this is a mortgage in bankruptcy and in arrears, they seem to have added a new policy regarding how to collect on such an account.

I don't think the bank would have ever sent a communication to anyone because you're probably one of only a few people to have this unique situation. The bank would say that it communicated the policy at the time you attempted to make a cash payment at a branch location. The bank would have never told the attorney or the Chapter 13 trustee because it's not material to the rate and amount.

I used to pay my mortgage payment on-base at a Navy Federal branch but after 9/11 it was more difficult to get on base. They changed the rules so I had to mail in the payment, but I did something similar to what Des does. I started sending them with tracking (not CMRR, just a tracking #). I did like the convenience of paying in a branch and with cash or a check.

[flashoflight]

I have a theory on what might be happening.

When your mortgage or auto loan goes into bankruptcy, all of the tellers are locked out of doing anything with your account. They're not even allowed to print a balance but they will tell you the balance if you are nice. So taking a payment of any kind at the branch is probably going to be a no go. They could ask the bankruptcy department to briefly unlock the account to take your money, but that requires a phone call and somebody answering on the other end. With my first post-petition auto payment, they called the BK department and unlocked the account temporarily. Then I paid and they gave me a receipt where they used a black magic marker to not show the balance. So the receipt has date and payment amount with the balance redacted.

Next month, I used electronic billpay for the auto loan. It takes a few days longer than usual to post the payment. I'm sure they have processes to deal with BK payments by mail and billpay a lot better than at the branch. I get no statements. I kept track of everything myself from the petition date forward. After the last payment, I got my title about 60 days later which is also longer than usual but that could have been due to COVID.

With mortgages, they might play even more games such as putting multiple months of payments in suspense and then randomly draining the suspense account and this cycle continues while junk fees are accumulated. Sorry to be the bearer of bad news on this.

[Carmella]

Will they accept a money order? If that is easier for you to get than writing a check. Our grocery store has money orders and it's a nominal charge, banks charge more for money orders so if you are at the grocery store to shop it would not be too much of a hassle.

I think once in BK if the institutions change the rules we need to go with the flow. For the longest time one of our car loans wouldn't allow electronic access and I don't trust mailing checks since I had late problems with mailing prior to BK, prior to Covid-19 mail issues, etc. One car loan I paid through a third party system they set up online with extra charge. The other I had to go in person to the bank to pay, but then I learned I can pay from one of my bank accounts directly. I go to the bank account where I have the other bank's car loan account number stored and it is paid electronically. It usually only takes 1 business day unless it's a weekend or holiday so you need to plan ahead.

I called about one of the car loans and like flashoflight said they won't even talk to me. They were very polite and said they could contact my attorney to get permission. But all I wanted to know was when does the payment end and how much in late fees do I owe because I know I have been late prior to BK, but never more than a few days and never ever for months on end. I think the loan is up around December since that's when BK payment is set to increase. I told them no thanks. I will address it later. I didn't want to bother the attorney with that it can wait until fall. It's crazy they can't tell us this sort of info, yet we are expected to pay the bill on time.

Being raised Catholic I keep feeling like all these hassles are my BK penance LOL! I guess that's something I relate to and it makes it easier to deal with because it is what it is and we can't fight it. We just have to accept the rules and carry on for the 3 or 5 time period until we are free of it!

[Clay3007]

justbroke im assuming thats what i will be told, just frustrating after 24 months the change. flashoflight thats the thing we have never had a problem driving up the to atm giving them the payment coupon and paying cash then they always printed a receipt with balances not marked out because it comes out of a new style atm/teller machine. Carmella they said they can accept check or money order at the location by me because they then will have to mail it to the main branch to the bankruptcy dept which i get because i pay our primary mortgage threw lost mitigation. But they gave me no address to mail a check/money order to or even who to send it to. the only reason i don't want to do a money order is because of the extra fee of paying for the money order. It may be small but still just an added inconvenience.

[Clay3007]

Well i finally spoke with our attorney and he checked court records and pacer and could not locate any changes. So we three way called the bank and spoke with the collections dept and the lady told us the tellers should have never been taking cash payments. It should have been a check/money order the whole time which they should of mailed to the main branch where the collections dept is. So to remedy this going forward i have to mail a check to them and pay it that way. I can drop a check off at other branches but then they will have to mail it over and just add time.

[justbroke]

Dropping off the check would create a nightmare situation for tracking and accountability. I'm glad that you were able to get to the bottom of the issue. Your in-branch cash payments certainly caused them some internal headaches that they didn't want to address. It makes sense to pay with a check for traceability, at a minimum.

[flashoflight]

Well i finally spoke with our attorney and he checked court records and pacer and could not locate any changes. So we three way called the bank and spoke with the collections dept and the lady told us the tellers should have never been taking cash payments. It should have been a check/money order the whole time which they should of mailed to the main branch where the collections dept is. So to remedy this going forward i have to mail a check to them and pay it that way. I can drop a check off at other branches but then they will have to mail it over and just add time.

I'm glad you did a 3-way with your BK attorney. If he wasn't there, the bank may restrict the information given. I think if the BK department had their way, everything would go through your attorney and not you like requests for payoffs and account history. It's not unusual for your mailing address on loans to be changed to your attorney's. That's why I said earlier if you are really nice and bring a donut, they might tell you the current balance on your auto loan. Just one of the disadvantages of filing BK...