Mortgage Co underpaid my county taxes

C

Captain Murphy

250+ Posts
Does anyone know the rules regarding mortgage companies and county taxes? I have a fixed mortgage payment and my mortgage company is supposed to pay my county taxes. Toward this end, part of my monthly payment goes into an escrow account so that they can pay my property tax when it comes due.

Only they (CitiMortgage) screwed up and did not pay the full amount due. As a result, I now owe late payment penalty money and late payment interest money.

Freakin' idiots. Aren't they required by law to pay my county taxes in full and on time?

I'm in the process of mailing them documentation to make my case. This is something I want to get straightened out, not something I want to wage a lawsuit over. Still, I'm curious: when mortgage companies screw up like this, are they in violation of the law in some way?
 
is your house new construction?

If so the taxable value has more than likely increased dramatically and taxes have increased accordingly.

Also, if this is correct, your mortgage company should have made you aware of this pending increase.


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yeah but mortgage companies will pay what is owed regardless of what is in the escrow account, and then send you a ****** letter about how your payment is going up by $xxx per month until you make up the difference.

they ****** up, call them on it. but be ready for your payment to go up permanently to make sure you're not underfunded again, and even more for a few months to catch you up for the shortage.

good luck getting them to pay the late fees, though.
 
I'm gonna say that it depends.

If they escrowed enough to pay it, but didn't pay the full amount, then I'd ***** like crazy. That's an accounting oversight.

If they just didn't escrow enough, I would still complain that they screwed up because they got the bill, but only paid what they had without any notice to you. (But your case is less firm.)

In either case, they should have informed you before the county did.






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Thanks for the replies. No, it isn't a new house, but they did just reassess the value of my property. Funny thing is, the mortgage company paid an amount that is in-between the old amount and the new amount. And yes, they did have enough in escrow to cover the shortfall.

I sent them a letter today.
 
yeah there's supposed to be a 2 month cushion built in from when you close as a buffer to value and assessment increases. again, good luck getting them to admit fault and paying the 2 months worth of penalties (so far) that have accrued.
 
Well, if you escrowed enough money with them to cover it, and they got the bill and paid less than that, then you should be raising holy hell.

That ain't right. They should pay the penalties and interest.

Your position should be that you DID pay it. It's your mortgage company that DIDN'T. Stick to that.

It's reasonable.




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Several years ago my Morgage company was supposed to pay my taxes in October in order to receive a 2% discount that the county offered for paying early. They paid the October amount in December. When I received the deliquent bill from the county I paid it . I called the mortgage co. daily until I they agreed to pay me back for their mistake.
 
I had the same thing happen 3-4 years ago with ABN Amro, I sent them a letter and within a month or so they had paid the difference plus the interest and penalty, no problem...I was stressed about it at the time, but the person at the county tax office told me it happens quite a bit...
 
The answer really depends on who was at fault. If the mortgage company paid the tax invoice they received then the county might have messed up by not responding to their request for your taxes properly. The way it works is that the mortgage company sends a list of the borrowers who have properties within that county to the tax collector asking them to forward tax bills. Then, they pay from those tax bills. If one was left off, etc. they can't pay it. Does your property have more than one county tax account? Perhaps one got paid and the other didn't. If it was all on one account and they just paid the wrong amount due to a typo of some such, they are responsible for penalties and interest but not the tax itself. I have been in the mortgage business for over 30 years and, generally, most companies will cover penalties and interest if the error is on their part. The biggest problem is getting a human on the phone who knows their *** from a hole in the ground. It does not have anything to do with whether you had sufficient funds in your escrow account or not (you did, anyway). They will pay even if it makes your account go negative, but at escrow analysis time, they will adjust your payment and/or ask for a lump sum to replenish your account.
 
Citi appears to be having problems. They took over my mortgage from ABN/AMRO. I got a nice little letter from my insurance company saying that my policy is being cancelled due to non-payment. Long story short - they have our money and out insuranc company submitted for payment as usual, Citi decided not to pay for some odd reason. It is sorted out for now, but you can be sure that I am going to end escrow and pay everything myself from now on.
 
I don't think there is a law that holds them accountable for paying the correct amount. I'm pretty sure you have to pay the difference and then as a customer you would have to unfortunately go to the mortgage co to and beg/complain for them to reimburse the penalties. Usually they overestimate the taxes so you get a refund at the end of the year. Good luck!!
 
My brother was the mortgage broker on my first mortgage and explained that escrow is a scam. I have never done one nor will I do one. If you trust me enough to give me a loan for several hundreds of thousands of dollars, I can pay my own damn taxes and insurance.
 
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