Can I recoup funds for foreclosure costs ifmy lendermade a mistake causing these costs to be incurred?
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Can I recoup funds for foreclosure costs ifmy lendermade a mistake causing these costs to be incurred?
In 09/10, my lender misapplied funds to my account. I asked for an amount to get caught up, including October’s payment, which I paid. In January. I received a summons about foreclosure. They did not apply funds to October; they applied the payment to principal. This caused me to be further behind then what I thought. Granted I did fall behind again, but was able to take care of missed payments in January. Now I am expected to pay $1717 in fees. I begged and pleaded multiple times for a “break” (not removal) of fees. Since they made an error. Is this possible?
Asked on February 9, 2011 under Real Estate Law, Ohio
Answers:
MD, Member, California Bar / FreeAdvice Contributing Attorney
Answered 13 years ago | Contributor
If you were already behind, the way payments are applied are first to outstanding interest owed and then to principal. If the amount you originally paid was less than the amount owed, that goes into a suspense account until the remaining amount owed is paid and then the month's payment is made/applied. If your lender or servicer (sometimes it is one and the same company) misapplied your payments, you need to file a consumer complaint with the entity who regulates your lender or servicer. Contact your state's department of financial institution to find who regulates that company and then file a complaint. Make sure you include as much relevant paperwork as possible and keep on top of the complaint process.
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