Can mortgage company take funds out of checking?

[debtfreedom]

Can a mortgage company take funds out of your checking and/or savings account if they are foreclosing? Or is the most they can do is the foreclosure and then possibly come after you with a deficiency judgement down the road after the home is sold? We are only 2 months behind on payments, but I have lost my job and it is only a matter of time before they foreclose. I have our account with the same company that has our mortgage, this is due to my husband's job is in Alaska and he needed an Alaska bank, which there are few of, one is Wells Fargo, who has our mortgage in Idaho.
Any help is much appreciated.

[StartingOver08]

Wells Fargo is very aggressive in taking funds out of your account to offset a debt. I would move the bank account to some other third party neutral bank now.

[magyar123]

Definitely close your Wells Fargo account and go with a different bank.

[hnhlvr]

Yep, close your WF account and open a new bank account QUICKLY. My DH almost wasn't approved to open a new account at a new bank because his credit score hit rock bottom after missing a few mortgage payments! Your score goes down about 100 points per missed pmt.

[justbroke]

If you Bank (checking and savings) where you have other credit products, the Lender is allowed to use a "right of setoff" by draining your depository accounts.

Yes, it happened to me!

Don't let it happen to you!

Don't keep money in any demand deposit account (Checking / Savings) or other liquid accounts, where you have a credit card, car loan, installment loan, mortgage, HELOC or any other credit product!!!

[car67]

Urgent

change banks now do not delay

[beth_anne]

YES!!!! It happened to me. I was past due for my mortgage prior to BK and about $1,000 was taken from my checking account the day my direct deposit went through. Change banks!!

[PoorGrammyinBK7]

This is from another bankruptcy blog I was reading. To anyone who has a credit card /loan and other accounts (checking/savings) at the same bank - please heed:

"The bank’s setoff rights are usually expressed in the promissory note signed in conjunction with the mortgage loan. As an example, one of my bankruptcy clients gave me a copy of their mortgage note with SunTrust. The note included the following language:

"RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a right of setoff in all my accounts with Lender(whether checking, savings, or some other account. ) This includes all accounts I hold jointly with someone else and all accounts I may open in the future....I authorize Lender... to charge or setoff all sums owing on the indebtedness against any and all such accounts, or at al Lender’s option, to administratively freeze all such accounts to allow Lender to protect Lender’s charge and setoff rights provided in this paragraph. "

Note that this provisions applies to all joint accounts. Therefore, if a married couple has a joint account at a mortgage bank and one spouse is indebted under this type of note then the bank can setoff money from a joint account which otherwise is protected from the judgment creditors of either spouse as a tenants by entireties account.

Check your lending agreements to see if your lender has inserted setoff rights. In most cases, do not keep significant checking account balances at the same banks to whom you owe money for mortgage loans, credit cards, or other personal loans.

[purplegirl12]

what about after the Wachovia merger?

so now can Wells Fargo go after the money in my Wachovia account, or are those two banks still separate?

[AngelinaCatHub]

so now can Wells Fargo go after the money in my Wachovia account, or are those two banks still separate?

[crimson]

Forget Opening another account!

Close out your account with WF and keep your money in a safe place at HOME....like a fire-proof safe.

We are currently defaulting on our house as well.

If there is no documentation that you have money somewhere, the mortgage company can't take it!

[crimson]

Forget Opening another account!

Close out your account and keep your money in a safe place at HOME....like a fire-proof safe.

We are currently defaulting on our house as well.

If there is no documentation that you have money somewhere, the mortgage company can't take it!