Signs That Your Mortgage Company is Making Errors

Mortgage companies are not perfect, especially Ocwen. Sometimes they make mistakes that can result in you paying more money than you are supposed to. If you feel that your mortgage company has made an error or that they are treating you unfairly – you may be right!

Signs to look for

If you believe that your mortgage lender has made an error, please do not dismiss it. You do not need to overpay. You will save more in the long run if you know what to look for.  Here are some signs that something is probably off:

#1 Being forced to pay GAP insurance.

In the case of GAP insurance, there are only a couple of cases in which you absolutely need it. The first is if you owe more on your mortgage if your home is worth. The second is if you opt for market value insurance that covers only the market value of your home’s structure. Many home insurance and mortgage companies do offer GAP compromises, but they are not supposed to force them. If they are, you can fight it.

#2 Your payment suddenly increases.

If your payment suddenly skyrockets, that could be due to adding the wrong margin or a simple human error. In the case of a mortgage, the margin is the profit that your lender adds on to the total profit. This one is often so subtle that it’s hard for either you or your lender to notice. The typical difference usually ranges at up to 5 percent. The difference between even 10 subtle points (for example, 3.75 vs. 3.65) can cost an unnecessary fortune over the life of the loan.

#3 Your interest rate suddenly increases.

If your mortgage is an ARM, the interest rate is tied to the federal funds rate. This means that the banks lend reserve balances (or excess balances from the Federal Reserve) to other banks overnight. As a result, it is very easy for lenders to calculate the wrong index value, thereby increasing your interest rate when they are not supposed to.

#4 Your adjustable mortgage rate (ARM) increases before its due time.

ARM’s work by giving clients a low interest for up to the first few years. It goes up after that. However, if it goes up too soon or too frequently that could be in violation of the mortgage terms you agreed to.

Errors are common and Ocwen is famous for making them.

If you have any reason to believe that your mortgage company is making errors when it comes to your monthly payment, please don’t dismiss it. David Ginsburg, the founder of Loantech – a mortgage auditing company, said that Loantech often finds numerous mistakes when they go over mortgages for clients. As a result, mortgage clients often end up overpaying on their monthly payments.  Ginsburg said that this has been going on since the late eighties. They were finding mistakes a third of the time up to about the late nineties. He says that up to 20 percent of the errors that they find are in prepayments, fixed-rate mortgages, and ARMs.

Simple human errors are also sometimes to blame. This can mean anything from calculating conversions incorrectly to inputting a wrong number. According to Ginsburg, this often results in systematic errors.

You have rights

If you believe that Ocwen or your mortgage lender is making serious errors, please call us or email us for help.