One of the most frustrating experiences homeowners can have is dealing with a mortgage company who seems to make numerous mistakes.
Especially if the homeowners fall behind on the mortgage or start making partial payments, the mistakes may seem to increase in number and severity.
This may be due to the bureaucratic inefficiency of lenders, but they may also indicate a far more serious problem.
The first question homeowners should ask once they suspect foul play from a bank is if they are dealing with a mortgage servicing company, rather than a direct lending institution.
This may help explain why homeowners would be getting letters demanding payment from a different company than the one they originally thought was handling the mortgage.
Mortgage companies sell loans back and forth to each other all of the time, and they will transfer the rights to collect the payments to a servicing company.
Mortgage servicing companies are notorious for making mistakes, not having payments right, not crediting payments to accounts, and charging or forcing other expenses on homeowners to push them into foreclosure.
This is termed "mortgage servicing fraud," and is quite common in the mortgage industry.
These lenders may just wait for an opportunity to go after a particular loan, and homeowners in financial hardships may give them one by sending in a partial payment, which the company will now use as an excuse to begin moving towards foreclosure.
Homeowners in any situation need to be careful with any partial payments, though, as the amount not paid will continue to accrue interest until they pay it back.
The owners' monthly payments may not be enough to cover the entire amount that they owe once the bank adds in the interest from the partially-missed payment.
Over time, this will ensure that the homeowners fall behind on their mortgages even if they think they have made up all of the payments -- they never made up the interest on the missed portion, which continues to build up and pushes the owners further and further behind.
Alternatively, the bank may just put the homeowners' partial payment on hold completely.
They have it in their offices, they may even have cashed the check, but they are not crediting the account with the payment.
Mortgage companies do not like accepting partial payments, since it decreases their ability to foreclose on a house.
These lenders would rather consider a partial payment as having missed a payment entirely and not credit it to the account until the homeowners make up the missed part.
In the meantime, interest and late fees will begin to add up.
Of course, if the mortgage company is already threatening to foreclose on the house because of one partially missed payment, the homeowners may suspect foul play and a hasty move towards taking the home.
The fact that they are threatening foreclosure so quickly should indicate to homeowners that the bank is considering them to be behind on the loan.
The house probably is not in the actual legal foreclosure process yet, but the bank is having their collections agents call and threaten the clients to scare them into paying back all of the missed payments plus related junk fees, as if threats would help at all.
Sending in a partial payment is always a somewhat tricky situation for homeowners, whether they are experiencing a financial hardship or simply had trouble for one month.
Banks do not like partial payments, and unethical servicing companies may use them as an excuse to start adding in as many fees as they can and pushing the house towards a foreclosure lawsuit.
Probably the best idea for homeowners who can not make a complete payment is to call their lender and find out their policy on partials and whether the payment will be segregated until the rest comes in or whether it will be applied to the account, as well as what other fees need to be paid back.