Chase escrowed my taxes without notification now I cant pay anything! Help!

[spooky]

Chase escrowed my taxes into my mortgage in august WITHOUT NOTIFICATION!!! When I asked them, they said that this was within their rights. Well, I told them that they just made it impossible and I cant pay anything. The thing thats nuts about this is that I live in Michigan, where most of us have lost our jobs- we didn't, nor were we behind on payments, we.ve been current forever, the taxes were not escrowed in because we knew we could never pay it that way. Through out the year we pay it off, usually right before or shortly after the new ones come out in July ( as was the plan this year) In aug we still owed between 4-500.00$ thats all, I had been doing it tat way all these years, with now problems with them. A friend who works at as bank manager ( not at chase) said that this is starting to happen more often. WHY!!! Is this true- are we the only ones?? This cant be true. ANYONE. We are going onto our 3rd month of not paying, Yes- I have been talking to them and they take no ownerships, or care! Spooky

[Tom_Mi]

Sorry, not advice, but want you to know you have company. We're in Michigan. Our bank ("Chevy Chase", not Chase) did the same thing in Aug. We were shopping for a loan to get our '07 taxes stretched out, but the bank suddenly paid the '07, and escrowed 08, and jacked our payment from 800 to 1800.

When they call, we just explain how THEY won't rework our loan and try to string them along...but I know we're hosed, eventually.

I'd pay a local attorney to demand judicial foreclosure and muck up the works for a year or so, but no such attorneys exist in Michigan (that I know of). My BK attorney doesn't want to deal with it.

[calgirl67]

Wells Fargo did this to us too, in July. All was going just fine, we've had this mortgage since 2005. Never paid a single day late. Did not have our taxes escrowed, always paid them out of our annual tax return.

One day they just send us a letter saying they have escrowed our taxes and our payment went up $1200 a month!!! I nearly fainted. Of course we cannot pay this.

Interesting thing is I went through our original mortgage docs and there is NOTHING in there that says they can do this.

But what does it matter? California is a non-judicial foreclosure state, they can do whatever the hell they like, then sell our house out from under us in a trustee's sale.

This is so damn crooked it reeks. The government needs to rein in these corrupt banks.

We have applied for an are currently in month 2 of a trial loan mod. We have decided if they are stupid enough to not make our mod permanent in January, we will file Ch 7 BK and walk away. Currently our house is worth just under $390,000.

We owe $600,000.... great business decision by Wells Fargo.

Forgot to mention we are already in the process of filing Ch 7 - most of our CC debt is related to renovations on our "dream" house.... what a nightmare.

[spooky]

can a chap 7 cover a mortgage? I thought if we filed BK, that because we have a mortgage it has to be chap 13? Were at the point of needing a lawyer. Spooky

[Stilltheone]

I just received a letter threatening to set up escrow for us because we owe half of 09 taxes. Somehow my mortgage company found out and, I have until Dec. 19th to show them proof that we actually paid the other half.

If my mortgage company sets up escrow, there's not much I can do about it. I plan on taking my tax return from Jan. and put it in a savings to cover my escrow, if need be.

It stinks that mortgage companies can do this!

[justbroke]

This is why everyone needs to actually read their Mortgage and Note. There are specific provisions which allows the lender to preserve their interest in the property. This includes paying HOA fees, assessments, taxes and anything else to preserve their security interest.

If you don't pay your property taxes, expect that your Lender will be notified and they will pay them before any tax certificate is issued.

[spooky]

Also chase said they wont do a mod unless I am current- well thats silly, They jacked me up from 1400. to 2500.!!!! well Duh! apparently they live in the universe of fantasy and deciet, I live in the universe of reality and truth, none of this adds up and theyr'e bankers! should I loose my house, it's ALL their fault, not mine. We nver agreed with this payment, there was areason why we didn't ecsrowed our taxes in to begin with, and we have a good history, well we wont now. Spooky

[spooky]

Hay I am NOT saying they didn't have a right to do this, I am saying at least notify me so I can avert this, Also, whether they can legally do thi is not my complaint, my complaint is that this was STUPID! A very STUPID financial move on their part. What prompted the bank to sqeeze a GOOD paying customer? If I did that to my customers, I wouldn't have customer long. I have been current on my payments- what? Did they not even look at our history? Stupid. Spooky

[spooky]

Hey STILLTHEONE, beware, thats what we did, we always used our returns . At least you got a letter, I told the poeple at Chase that due to the importance of this, they really ought to send the letter registered mai, so we're both covered, but again that would be SMART and logical. Something thy don;t believe in. I did read my contract, it did say they can do this, I knew they could, but I thought that if they ever chose to do this that I would be at least notified, but no-nada- zippo. Spooky

[justbroke]

Hay I am NOT saying they didn't have a right to do this, I am saying at least notify me so I can avert this, Also, whether they can legally do thi is not my complaint, my complaint is that this was STUPID! A very STUPID financial move on their part. What prompted the bank to sqeeze a GOOD paying customer? If I did that to my customers, I wouldn't have customer long. I have been current on my payments- what? Did they not even look at our history? Stupid. Spooky

I don't see how it's stupid.

Did you know, you can pay down your ESCROW account. Just call and ask. They will allow you to send in a payment specifically for the escrow account, and also ask them to re-analyze your escrow payment after that. Of course, this only works if you really were prepared to pay the taxes in a lump sum.

They are not squeezing a customer. They are preserving their rights. They do not want a tax certificate to be sold against the property that has superior lien rights to theirs!

[StartingOver08]

As to how the bank finds out about it: if you remember the closing when you purchased (or last refinanced) you might remember a fee called "Tax Service Fee" for about $80, more or less. That one time fee is to have someone monitor the tax payments made by you on your property for the life of the loan. If the payment is not made on time, the monitoring company notifies your lender electronically right away. This way the lender can pay the taxes and pass the cost back to you in the form of a mandatory escrow account. BTW, the provision is written in the note and mortgage to do this....we just don't normally run into it until we have difficulty paying our taxes on time.

[Stilltheone]

Hey STILLTHEONE, beware, thats what we did, we always used our returns . At least you got a letter, I told the poeple at Chase that due to the importance of this, they really ought to send the letter registered mai, so we're both covered, but again that would be SMART and logical. Something thy don;t believe in. I did read my contract, it did say they can do this, I knew they could, but I thought that if they ever chose to do this that I would be at least notified, but no-nada- zippo. Spooky

We have always used our returns and last year we came up short. That's why I'm thinking that if my mortgage company (Aurora) DOES set up escrow, it wouldn't be the end of the world, KWIM? I wouldn't have to worry about it in the future.

I don't see how it's stupid.

Did you know, you can pay down your ESCROW account. Just call and ask. They will allow you to send in a payment specifically for the escrow account, and also ask them to re-analyze your escrow payment after that. Of course, this only works if you really were prepared to pay the taxes in a lump sum.

They are not squeezing a customer. They are preserving their rights. They do not want a tax certificate to be sold against the property that has superior lien rights to theirs!

I also don't see how it's stupid, frustrating as a mortgage payer, YES, but of course it's in the mortgage company's best interest to preserve their property.

We were also told this by our mortgage company. If they pay our back taxes, all we have to do is call them up when we get our tax return and pay them back.

As to how the bank finds out about it: if you remember the closing when you purchased (or last refinanced) you might remember a fee called "Tax Service Fee" for about $80, more or less. That one time fee is to have someone monitor the tax payments made by you on your property for the life of the loan. If the payment is not made on time, the monitoring company notifies your lender electronically right away. This way the lender can pay the taxes and pass the cost back to you in the form of a mandatory escrow account. BTW, the provision is written in the note and mortgage to do this....we just don't normally run into it until we have difficulty paying our taxes on time.

You say "notifies your mortgage company right away"....We were issued a tax certificate on Sept 1. When my mortgage company sent me a letter, it had the original balance that was issued on the certificate, not the new balance with interest and fees.

So obviously, they "caught us" during the month of September, but didn't notify us until 2-3 months later?

[spooky]

Okay, Again, I am not saying that they are wrong for escrowing the taxes, I said that we were NEVER notified !!!! Being blindsided with the surprise is what I am saying is wrong, Also, the amount was HUGE, previous amount due ( 450.00) + ahead by a year, it rounded up over 6000$ I would love to pay that and be done with it, but would they do it again? We always paid up our taxes by around tax time, we either pay all, or 3/4 of it., the last 1/4 was still due in Aug, when they sent us the new payment. AT Least warn a person.! 450.$ is not a large enough amount ( in my opinion ) to jeopardize the customers ability to pay. spooky

[justbroke]

If you were never notified, how did you find out? Generally, the lender tells you AFTER the fact that they paid the taxes on your home and adjusted your escrow account. Tax certificates are serious business when it comes to your lender's rights. So are HOA issues!

[spooky]

They sent a letter telling us the new mortgage payment AFTER they already paid the taxes.It was our monthly bill statement that they then let us know what they did. I was about to pay that small remaining 450. still owed. IF they had first sent a letter warning me that they were concerned about the remaining balance, I would have ran and paid right then and there sending them the proof as asap. i get that they need to be paid, but a letter sent registered mail so there is no Q on either side, would have easily cleared this up. But no, they just paid the taxes, THEN told us after the fact. It is upsetting. thats all I am saying.