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KimberlyLaw
KimberlyLaw, Attorney and Real Estate Broker
Category: Real Estate Law
Satisfied Customers: 4219
Experience:  13 years of experience in real estate law: Foreclosures, Landlord-Tenant, Condo/Coop, Property Law, Deeds, Purchases/Sales, Estates.
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PNC Mortgage Co. is sending back my mortgage payments

Customer Question

PNC Mortgage Co. is sending back my mortgage payments stating that there is shortage in my account. Also stating that because of this escrow shortage they my account is in default. I have written the an inquiry about the account but there has been no response at of September 5, 2005. My calculations are that they are overcharging me without relating this to property assessment. According to the Inquiry Written Response they have 5 days to respond. The other issue can a mortgage company use escrow shortage to cause your account to go into default by refusing to apply the monthly payment to the account. Also on what basis can they decide to increase your escrow account.
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  KimberlyLaw replied 1 year ago.

Hello, I am happy to assist you today.

I used to work for a lot of these large banks as their foreclosure attorney, and I can't even tell you how common it is for escrow accounts to mess up the accounting of a mortgage at no fault of the borrower. This is not your fault and can be worked out, but will take some patience and determination.

First, you should send another letter asking for a full accounting of your account. Under the Fair Debt Collection Practices Act the bank must respond to you in writing with that accounting within 30 days. I would try to get this letter to go to the bank's attorney, either their legal department nor their outside legal counsel. That is your best shot to get it treated seriously.

I agree with your suspicions, and expect that when you see the full accounting you will see something went wrong with the escrow account.

Unfortunately, the way most of these loans are written, they can consider your loan to be in default if the escrow is in default, and they can also reject your payments if they are not payments in full according to their calculation. I know, sounds crazy. There is much room for improvement here.

The basis that they use to increase the escrow is laid out in your mortgage document, so you will have to look at that specifically. That can differ.

Let me know if I thoroughly answered your questions.

Kim

Customer: replied 1 year ago.
I have already paid them $3,000.00 over last year that was suppose to be applied to the escrow shortage so you are telling me that without any legal proof they can continue to claim a shortage in the escrow account as a way to cause the property to go into default. What California Code are you referencing to make such an outrageous claim.
Expert:  KimberlyLaw replied 1 year ago.

Sorry if my answer was confusing. No I did not say that they can legally claim that you owe money that you don't owe to make your account go into default.

What I said was that this is a common accounting problem. I do not suspect that it was intentional, but it is definitely something that should not happen. I am on your side here.

Again, you must get a full accounting from them, including the escrow account, because that is the only way to sort this out. You have to actually point out to them where the mistake is. I totally understand that it shouldn't be your responsibility, however, if you don't do that, your account will continue to be in default and will go into foreclosure. It would eventually be resolved but would cause much more pain and suffering on your end if it had to go that far.

So, let's just get this resolved and get a copy of your full accounting so that you can take a look at it and call up their lawyer and explain the problem.

Please note, in your letter to them please state that you "dispute the debt" which is a key phrase that kicks in certain legal protections for you.

I hope this helps,

Kim

Expert:  KimberlyLaw replied 1 year ago.

Hello, just letting you know I am logged in today, if you would like to ask any follow up questions or close out the question so I get credit for my work with you.

Thanks!
Kim

Customer: replied 1 year ago.
PNC bought the loan from another company where the previous company did not make escrow shortages a basis for default.
Expert:  KimberlyLaw replied 1 year ago.

Ok. Well, the mortgage documents govern that, it wouldn't be up to the new company who bought the loan to make a new rule. They have to abide by whatever the documents say that they purchase.

So if the mortgage documents say they can't use escrow shortages as a basis for default, then they can't do it. This is further legal grounds for a law suit.

I hope this helps,

Kim

Expert:  KimberlyLaw replied 1 year ago.

Hi, just a reminder, please close out the question with a 4 or 5 rating so that I get credit for my work with you.

Best of luck,

Kim

Expert:  KimberlyLaw replied 1 year ago.

Good morning,

I see that your question is still open. Please don't forget to close out the question with a 4 or 5 rating. Otherwise, the system may keep your money and I won't get paid for my work with you.

Feel free to request me again in the future!

Thank you!

Kim

Expert:  KimberlyLaw replied 1 year ago.

Hello again,

I see that this question still needs to be closed. Please close out the question with a 4 or 5 rating. If you don't, the system may keep your money and I won't get paid for my work with you.

Take care,

Kim

Expert:  KimberlyLaw replied 1 year ago.

I need to close out this question. If you don't close the question (with a 4 or 5 rating), the system may keep your money and I won't get paid for my work with you.

This is my full time job, so I appreciate you taking care of this,

Kim

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