Home Point Financial Escrow Account Shortage Loophole Ann Arbor MI Michigan

We purchased our home in 2014 with a fixed rate FHA mortgage. Escrow was established to pay real estate taxes and home hazard insurance. Each year, the company has increased our monthly payment by 18%-24% based on projected escrow shortage. The way they do this is by ignoring the preferred practice of paying real estate taxes in quarterly disbursements, and instead paying the entire annual tax bill in full in the same month they pay the entire home hazard insurance. They time these in-full disbursement’s immediately before they calculate the projected escrow balance for the following year, ensuring that the balance remaining at the time of calculating this projection is low enough to justify a monthly payment hike sufficient to cause hardship and late payment as we scramble to find third and fourth sourcesof income to make up the difference. Then, if we fall short, being that the time commitment required to contact anyone who can assist us is hours or days, we incur a late payment, hurt our credit, and receive threats of default. Home Point knows our property value is going up and they want a quick profit from selling our home if we face foreclosure. They found a loophole in the fixed rate mortgage contract, by exploiting escrow.

They do this every year and every year, in spite of countless hours and sleepless nights spent trying to rectify this, they act as if they are shocked at our request to follow recommended best practice and just pay taxes from escrow in installments. This is predatory. But, they’re rich and we are working four to five jobs just to stay middle class. So, they know they can bully us.