Mortgage holder won't tell us payoff amount on loan

[Carol Talbott]

6 years ago we got a $150k mortgage on a house. The loan was sold to a mega bank. Things were good until last year when a life threatening medical condition caused us to lose 1/2 our income. We fell behind on our mortgage. We applied for mortgage assistance and the bank has been dragging their feet, losing our application, claiming the application expired, then losing the new one. Then asking for more proof of income, different tax documents, new, redacted documents, etc. 

In the meantime we put the house up for sale and we have a contract to sell the house for about $90k more than we owe on it. The closing on the sale will be about a week before foreclosure. 

We are in the week that closure on the house is supposed to occur (forclosure next week), everything is in line to close. Except the bank will not tell the title company what the payoff is. Just flat refuse. They refuse to tell us (as the people on the loan) also. They say we have to fax written authorization and give them 72 hours before they will tell us/title company. The title company faxed over this authorization and they say they never received it. (Same thing they did with the assistance application, repeatedly). 

We are getting to the point where we are going to lose the sale, and the house simply because they won't tell us how much we owe them. 

Is this even legal? Can they take my house when they won't tell me how much I owe so I can pay it??

[Marc Yu]

I would walk to the bank and demand the amount.  I would wait in the lobby and get progressively louder as the time passed.

[Mike Cumbie]

@Marc Yu,

Has the right idea. Walking into the bank and standing in front of someone sort of forces their hand. Follow it up with "Oh, I understand can I speak to a supervisor" all the way up the chain in the bank, then the district, then you get the idea.

It's harder to say no in person. 

[Russell Brazil]

Do you have an online account with the bank? There is usually a button for request payoff amount

[Chris Mason]

Originally posted by @Mike Cumbie:

@Marc Yu,

Has the right idea. Walking into the bank and standing in front of someone sort of forces their hand. Follow it up with "Oh, I understand can I speak to a supervisor" all the way up the chain in the bank, then the district, then you get the idea.

It's harder to say no in person. 

 This, and you literally don't let them off the phone until it comes through. 

Assuming of course there is no payoff demand button on the online account per @Russell Brazil.

[John Thedford]

This unfortunately makes no sense. It would benefit them to provide the payoff. I know banks can be AWFULLY slow. We waited over a month for two different payoff amounts. Unfortunately, calculating payoff is a bit more than the current mortgage balance. They need to prorate interest, any fees, etc to give an accurate payoff. You cannot afford to be given the wrong amount thinking the problem is resolved. I am sorry but I don't know of any solution better than walking in the door and demanding they get the figures. If you can't get quick action you might threaten to go to your state banking commission.

[Carol Talbott]

Thank you. The bank is Chase, and they do not have a physical location in the Nashville area. 

I realize that a payoff is not an immediate figure, but they are actually arguing with the title, saying that they will not disclose the figure to them. The title company has called twice now, with us on conference call and still can not get anywhere. They've had more than 24 hours to arrive at a figure. 

I believe that Chase stands to make a decent profit off foreclosing on my home, and are dragging their feel to force us to foreclose. I have believed that since they started claiming to have not gotten our applications. And when the first application "expired", they never notified us, they just closed our mortgage assistance file. Had we not been diligent about it, as I'm sure many are not, they would have just taken our house. They also refused a large payment on the account since filing for mortgage assistance. Actually that's how we found out it was scheduled for forclosue, I called to see why several months payments in a lump sum had been refused. Until that point they had not notified me in any way that they had begun the foreclosure process. We thought we were in the assistance program. 

I have decided to begin recording further calls, as I'm fairly certain that refusing to tell us how much we owe, but still charging us interest is illegal.

I might be contacting the Tennessee banking commission. If I do, I'll post an update.  

[Russell Brazil]

Originally posted by @Carol Talbott:

I believe that Chase stands to make a decent profit off foreclosing on my home, and are dragging their feel to force us to foreclose.

I can tell you with utter certainty this is false. JPM has a market cap of $305 billion. They have about $9 billion in income per quarter. The amount of money to be made on your property is like pennies to them, it doesnt even register.

Also they probably dont even own the debt, they probably just service the debt. The debt is likely in a Fannie Mae mortgage bond.

[Joseph O.]

If there is that much equity it might behoove you to tell the title company to send all sales proceeds to the bank as payment. The bank will then have to forward you a check once it clears. Usually within 30 days.

[Colleen F.]

Part of the problem is you are dealing with a corporation and not people right now. Sign the release paper again and follow up by phone afterward. Get names, full names and ask them to spell them. Take it to the next level by asking for a supervisor. Let them know you sent the authorization previously on x date and ask for an expedited response as they lost it.   They say they need three days, get a commitment from a person to get back to you. while you can often request payoff on line as suggested you always need to follow up. if they ask for paperwork you have to supply it and sometimes it needs to be in writing. sometimes you need to fax and call to verify they receive it. No it shouldn't be this hard but be persistent and keep a good record of who you spoke with. it sounds like the stakes are high enough that making an appointment at their Kentucky office may make sense if you don't get anywhere by phone.  Keep your cool but be forceful ,persistent, and repetitive.

[Jay Hinrichs]

Banks will not make any money they lose money on OREO... plane and simple.

@Joseph O.  has the right idea.. get your last bank statement ot the title company show you have massive equity... close the deal LEAVE 100% of your proceeds in escrow until you get the payoff demand... its common for satisfaction of mortgages to follow closings.   a good title company should be albe to work this out for you

[Carol Talbott]

I'm not talking about the bank, I'm talking about incentives for the employees to turn a profit in foreclosures. They get a bonus and the year is ending. (I don't know this for a fact, but I'm telling you, these people are intentionally obstructing the process). I'm not dumb enough to think Chase as a corporation gives a crap. 

I will follow Colleen's advice. Thank you!

[JD Martin]

Forget about the banking commission. If you can't get the deal closed because of the bank you need to have an attorney file an emergency stay on your behalf to prevent foreclosure.

[Jay Hinrichs]

there is a huge misnomer that banks make money on foreclosures nothing and I mean NOTHING can be further from the truth.. I know in your little slice of the world and deal it would appear this way.

but the fact is with that kind of equity someone would buy it at the court house steps.

and I forgot about this.. If you are in foreclosure you have a payoff demand.. its in the foreclosure documents.. just pull those up.. it will give the amount owed.. the per diem and expenses ..

they have to know what is owed to have a starting bid..

[Jessica Zolotorofe]

Check your loan agreement. Is there a clause that requires you to provide notice in a certain manner to the bank? Try sending in a signed written request to their payoff department with your account number and see if that helps. Send it certified so they can't claim they didn't receive it. Otherwise, the escrow of proceeds is a good idea, except not sure the title company will do it. A loan payoff can actually be substantially higher than face value of the mortgage so they probably won't be ok with insuring, even with the full amount in escrow, especially if any other liens or costs need to be paid out of proceeds. IMPORTANT though, in most states you are entitled to adjournments of the foreclosure sale. At least one. Definitely try to exercise those asap. Last thought (other than going to court to request a stay and asking the court to require the bank to produce a payoff, as mentioned above), is you can find the bank's attorney info in the foreclosure papers and see if they will cooperate in getting you one. Good luck!

[David Dachtera]

@Carol Talbott,

I just discovered this in selling my own house.

In the past, yes - the title company requested this.

Apparently, some privacy legislation changed all that. Now, you must personally request the payoff letter yourself, probably in person.

So, if you can, walk in like you've never inquired before, and let the person know you're selling your home and need a payoff letter for your mortgage. If they don't inquire about all the history, don't volunteer it. Just ask for the payoff letter.

Hope this helps.

[Jacob Ghena]

You loan is so far past due it's probably moved from the normal "payoff department" to the "foreclosure department." I've run into this before on a listing...took the escrow officer two weeks to get payoff amount because they were talking to the wrong branch of the bank. The "normal payoff" people wouldn't respond to any request because the loan was no longer in there department.

The key for getting the correct payoff amount was talking to the "foreclosure department" at the servicing bank. The lawyer or escrow officer who is requesting the payoff on your behalf needs to know this and be a little relentless in talking to the foreclosure people. That combination should solve the problem.

[Carol Talbott]

Thanks everyone. I'm not sure exactly what the title company said to them, I do know they were doggedly diligent in demanding a figure...but they finally gave us a payoff amount. 

And they agreed, very reluctantly, to suspend the foreclosure while they reviewed our application for mortgage assistance. So, between finally getting the payoff, and getting a temporary stay on the foreclosure, we ended up closing on the original foreclosure date. 

The house is sold, and I'm out from under ther pressure of trying to keep it. 

Yay!

Thanks everyone for your help!!