Mortgage Impound Problems

Dear Phyllis,
I love the variety of questions
in your column. I don’t believe
you have touched on mortgage
impound problems before. My
daughter purchased her condo
nearly ten years ago, refi nanced
several years ago, and has a
2.75% mortgage. About eighteen
months ago, her lender started
impounding her loan. She pays
her insurance and property taxes
on her own, so this escrow account
just keeps collecting money. She
has spent hours on the phone with
customer service and escalating
to speaking with supervisors but
nothing gets done. Obviously, she
can’t refi nance and lose that low
interest rate. She fears letting
the lender pay the property
taxes because she feels they are
incompetent. This is not a local
bank with a branch that she can
just visit. What do you suggest?
Jenny

Dear Jenny,
Your daughter’s situation with
her mortgage lender’s improper
impound account is frustrating,
especially given her low 2.75%
interest rate and her preference
to manage her own insurance and
property taxes. Here are some
steps to consider:
Document All Communications:
She should compile a detailed
record of all interactions with the
lender, including dates, times,
representatives’ names, and what
was discussed. She should save
emails and letters and take notes
during calls. This documentation
is critical if escalation is needed.
Send a Formal Written
Complaint: Write a concise,
professional letter stating the
issue: The impound account was
imposed without her consent.
She has always paid taxes and
insurance herself and wants
the account removed and funds
refunded. Demand a written
explanation and escrow statement
(per RESPA, a federal law that
regulates mortgage loans and
real estate settlement services.
It requires lenders and brokers
to provide disclosures, limits
escrow accounts etc.) to check for
overfunding and request a refund.
Please send it via certifi ed mail.
“CC” (send copies of the letter
to): Dept. of Financial Protection,
Consumer Services, 2101 Arena
Blvd. Sacramento, CA 95834
Consumer Financial Protection,
PO Box 2900, Clinton, IA 95814
Senator Sash Renee Perez,
1021 O Street #7630, Sacramento,
CA, 95814

Best of luck in getting this
resolved without having to hire
an attorney.
Warm regards.

Phyllis