My mortgage company can bite me...

My rage only burns with the luminosity of a 1 Watt LED, so I’ll keep this out of the Pit. But I’m mildly irritated at my new mortgate company. Citi recently bought out my mortgage and so far, things have been uneventful. Yesterday, I came home and found an overnight package from the mortgage company. “Well, crap,” thought I, “If they’re going to piss away money on overnight delivery, it’s going to be bad news.”

So I went through a minute or so of very unpleasant foreboding while I opened the package. And…it was an offer to drop my mortgage by a * whopping * 0.1 APR (from 5.85 to 5.75). Apparently, Citi thinks I’m an idiot who’s willing to go through the whole agonizing closing process again to save a very few dollars a month AND reset my financing back to the 30 year mark.

Let’s do the math, shall we? Citi claims that the 0.1 delta will save me $67.00+/month. According to a mortgage calculator I just played with, it’s more like $10.00/month or $5000.00 over the life of the loan. But let’s play their game and assume it’s $800/year. That would be a savings of no more than $24K over a 30 year loan. Well, I’m something like three years into this mortgage so I’ve already paid far more than that just in interest – interest that I would have to pay all over again if I refinanced. Not to mention the closing costs (of which they’d generously pay $500.00 towards).

I repeat, Citi Mortgage thinks I’m an idiot. Thanks, guys. Come back when you’re ready to lower the APR to 4.00. And pay all closing costs. And mow my lawn and paint the garage while you’re at it.

Well yeah - but then every mortgage company thinks (or hopes) that every client (or potential client) is an idiot.

Though that particular one is probably a screwup on their part unless they think the terms of the “new” loan would be somehow more “special” than the old loan. Um, no.

We’re regularly offered the chance to change our mortgage from a monthly payment to a biweekly payment, for a mere 300 bucks setup fee and monthly (or annual?) fee for the privilege. Lessee… pay them to do something we could mimic ourselves for free??? Er, no thanks. (This isn’t Citi, it’s another major mortgage financer that rhymes with Smells Cargo).

And then there are the “cold-call” letters we get from every little mortgage company in the country. Labelled prominently “Important Mortgage Document Enclosed” but with no return address. The contents proudly pointing out that we could drop our existing rate to 4%!!! and not-so-proudly admitting that that rate is variable and will soon be requiring us to turn around and bend over.

But funniest of all are the ones from our own mortage company, offering us a chance to get a home equity line of credit. No thanks - we tried that when we refinanced and were all set to do it, when we saw the closing paperwork that charged us additional closing costs (closing costs are routine with a HELOC but often can be waived, especially in this sort of situation). We wound up getting the HELOC through our credit union, which paid the costs themselves and as a result will make a nice profit over the years.

Ooh, can I join the pile-on?

I’ve become quite good at spotting these mortgage-refinancing idiots and weeding out their junk mail before it soils my eyes. I’m well aware that the only thing less important than the number of dust specks on my shoe is an envelope labeled “Very Important.” But yesterday, one got through which took the cake.

It came in a yellow envelope, addressed from the “AUDIT DIVISION”, with the year “2005” printed on the front in exactly the same font used on a 1040 form. Naturally, I was supposed to think that I’m on the verge of being audited by the IRS, and I was actually skeptical. But I figured I’d better see what it says just in case.

Sure enough, it’s just another one of those despicable solicitations. Where the hell do they get off doing this crap?

May I suggest that someone else’s mortgage company can bite me?

I decided this year that I was going to buy a house. Heck, I’m almost 30, it’s time to grab hold of some long-term capital.

So I found a house. It’s a very nice house (except for the yard, which I don’t mind working on), for a very nice price. It’s owned by some very nice people.

These very nice people are are apparently many months behind on payments and are upside down on their loan (they owe more than the house is worth, probably from no down payment and closing fees). (note: I probably shouldn’t know this, but I do).

The mortgage company has the option to forclose. They also have the option to nix a “short sell” (setting a sale price below the amount owed). They apparently have employees whose job it is to run numbers to decide which way to go.

It’s taken them a month and a half, and I still don’t have an answer.

Mortgage Company Employee #1 apparently ran the numbers and said last week that they’d be willing to sell the house for the amount I offered. Fantastic! Then I found out that the decision made by Employee #1 needs to be approved by Employee #2 higher up the food chain. We were supposed to hear from Employee #2 on Wednesday. Two days and still nothing from the mortgage company.

To make things even more fun, I went to month-to-month rent on my apartment at the beginning of June (my lease was up at the end of May). I’ve bumped my move out date three times because of this delay. And the capper is that I can only bump my move out date if they haven’t rented my apartment to someone starting after my “on record” move out date. Someone signed up for my apartment last week. Unless things move fast on this house, I’m going have to put all my stuff into storage and move in with my girlfriend (who has also gone to month-to-month since I had asked her to move in with me once I got the house).

I don’t blame my realtor, or the nice people who own the house. I put a lot of the blame on the mortgage company who can’t seem to give an ETA (or give one and take the absolute max time). I put a little blame on the seller’s agent who probably shouldn’t have listed the house until this was taken care of (or until there was a firm schedule on when it would be taken care of). I put a little blame on myself for not biting the bullet and start shopping around for another house a few weeks ago when things were at their most vague.

Nameless mortgage company: Bite me.

Jeez-o-flip!

Is this one of those situations in which the seller is expecting to bring cash to closing to get out of the loan? Guess not, or the mortgage company wouldn’t care at all (we had friends in that situation a few years ago, except in their case it was because the condo market had taken a bit hit).

Or is this basically an alternative to formal foreclosure, in which the mortgage company agrees to take a bit of a loss but winds up with most of it paid back when you purchase, by the proceeds of your new mortgage? If that’s the situation, I guess I can understand some approvals being required, but they’re being idiots by sitting on it this long. Either they think they can get more, in which case they should foreclose and sell, or they can’t, in which case they should approve your purchase and get their cash back soonest.

From my understanding (based on information that I should or should not be privy to), the current owners can’t cover the difference. So the mortgage company would be looking at a loss one way or another. The red tape is probably just to determine whether their loss would be greater by selling the house, or by going through formal forclosure (probably involving legal fees) or covering the loss some other way and putting it back up on the market later as an “owned by bank” property. With the variability on the housing market lately, maybe that was a tough call. And this is apparently a somewhat common thing (although apparently more often it’s handled before the property is even listed), so they had a lot of other properties to run through the same procedure. Rationally, I suppose I can understand it, but emotionally it was really ticking me off.

Of course, ten minutes ago I got a phone call: they’re letting me buy the house. Now I’ve just got to sign and approve the amended schedule (since many dates have slipped due to the bank delay). I doubt I’ll be able to get the same closing date (27th of this month as of the last extension), but unless anything else goes wrong, I’ll be able to move from my current place (move out date of July 20th) straight to the house without worrying about storage / homelessness.

Hehe, maybe someone at the company reads the Dope and came across my post. :slight_smile: