Regulation of mortgage lenders / Non Escrowed Accounts
Regulation of mortgage lenders / Non Escrowed Accounts
The Issue
When I initiated my home loan, I was charged a fee of over $200, in order to have my account be 'non escrowed', meaning my insurance and property tax bills are sent to me and not escrowed into my mortgage payment. That is how I prefer to be billed.
One day I received notice from my insurance company that my home insurance bill payment is late. I had never received a bill from them. The insurance company checked and said it had been sent to my mortgage lender (US BANK) in error. They said they would correct where it goes in the future. However, this puts the homeowner of fees or legal trouble when the insurer contacts the lender to say that the insurance was not paid. I contacted the lender, and asked why I wasn't informed that they received my insurance bill. They said they don't do that, they simply log the fact that mail was received, and that’s it. End of story.
It is irrelevant whose mistake it was that the insurance bill was sent to the wrong place. The issue is that the lender, who charges a large fee for this arrangement, does not take the responsibility to notify the homeowner (nor the insurance company), when they receive a bill in error, they just do nothing. There no OVERSIGHT to ensure they do the responsible thing. What is the purpose of the fee, then, other than just extra profit for doing nothing?
It would cost the lender little to nothing to add in an automated email to the account holder when a bill is received in error. They know very well which accounts are non -escrowed. They also know that the homeowner didn't get the bill, since it went to them, and hence won’t know that it is now overdue.
There needs to be a regulation in place, for any lender who charges a FEE for setting up non escrowed accounts, REQUIRING them to notify in writing the homeowner when they receive an insurance or tax bill on that account.
The home homeowner should not be charged late fees and /or have the burden of spending their time trying to straighten out a mess that the lender could have easily prevented by simply DOING THEIR JOB.
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The Issue
When I initiated my home loan, I was charged a fee of over $200, in order to have my account be 'non escrowed', meaning my insurance and property tax bills are sent to me and not escrowed into my mortgage payment. That is how I prefer to be billed.
One day I received notice from my insurance company that my home insurance bill payment is late. I had never received a bill from them. The insurance company checked and said it had been sent to my mortgage lender (US BANK) in error. They said they would correct where it goes in the future. However, this puts the homeowner of fees or legal trouble when the insurer contacts the lender to say that the insurance was not paid. I contacted the lender, and asked why I wasn't informed that they received my insurance bill. They said they don't do that, they simply log the fact that mail was received, and that’s it. End of story.
It is irrelevant whose mistake it was that the insurance bill was sent to the wrong place. The issue is that the lender, who charges a large fee for this arrangement, does not take the responsibility to notify the homeowner (nor the insurance company), when they receive a bill in error, they just do nothing. There no OVERSIGHT to ensure they do the responsible thing. What is the purpose of the fee, then, other than just extra profit for doing nothing?
It would cost the lender little to nothing to add in an automated email to the account holder when a bill is received in error. They know very well which accounts are non -escrowed. They also know that the homeowner didn't get the bill, since it went to them, and hence won’t know that it is now overdue.
There needs to be a regulation in place, for any lender who charges a FEE for setting up non escrowed accounts, REQUIRING them to notify in writing the homeowner when they receive an insurance or tax bill on that account.
The home homeowner should not be charged late fees and /or have the burden of spending their time trying to straighten out a mess that the lender could have easily prevented by simply DOING THEIR JOB.
60
The Decision Makers
Petition created on May 5, 2023