By Admin on Nov 13, 2009 in Renting & Real Estate
babehmonkeh asked:
Recently the bank that my mortgage loan is through went bankrupt. My mortgage loan was transferred to Bank of America. Initially, i had a 30 year fixed mortgage rate and now B.O.A is saying that my payments are almost 500$ more than they initially were. Is this illegal for the bank to do this?
Recently the bank that my mortgage loan is through went bankrupt. My mortgage loan was transferred to Bank of America. Initially, i had a 30 year fixed mortgage rate and now B.O.A is saying that my payments are almost 500$ more than they initially were. Is this illegal for the bank to do this?
No they can’t change your rate if it truly is a fixed rate loan. I would make sure of that first. Then if you are sure, I’d file a formal complaint with the Federal Trade Commission.
Realtoratheart | Nov 13, 2009 | Reply
cmon ask the right question. your interest did not change. escrow amounts can change. so a payment under a fixed rate loan can change because of escrow. $500 is a lot so I would ask some questions.
David Z | Nov 15, 2009 | Reply
You need to check back with your own paperwork and be sure it was a fixed rate. Sometimes the small print will say something about increasing the interest rates. Go to the new bank and explain the situation.
~*Mama-of-Two*~ | Nov 17, 2009 | Reply
Call the bank and ask them why the payment changed. As another person mentioned, it may be an escrow issue. The mortgage company on one of my homes was also absorbed by BofA, but nothing changed. I do not escrow as I choose to make my own insurance and tax payments. I DID, however, get a notice from BofA tht I needed to update my insurance information with them or they would supply insurance and include that in an increased monthly payment.
Unless you defaulted on payments, the purchasing bank cannot change your interest rate. Again, call the bank and find out what’s going on.
Read this:
Simpson G | Nov 19, 2009 | Reply
Sounds like you didn’t have enough funds in escrow or you taxes and/or homeowners insurance went up. If so…perfectly legal.
reenzz | Nov 21, 2009 | Reply
sounds like your payment went up due to taxes etc, doesnt sound like your payment went up.
Your payment will always stay the same with the exception of your last one. the things that fluctuate are your taxes and maybe PMI if ou have it
live.here | Nov 22, 2009 | Reply
The terms of your loan remain unchanged. What may have changed is the monthly payment into your escrow account.
jlf | Nov 24, 2009 | Reply
Your interest rate hasn’t changed, but your insurance and/or property taxes could have. Do you know what your insurance is yearly? Do you know if your property taxes went up this year? My mortgage rose $55/month due to an increase in both my homeowner’s insurance and property taxes this year. $500/month is outrageous though, so you need to do some investigating.
To answer your question… a bank cannot change a fixed interest rate.
spalmer | Nov 27, 2009 | Reply
You were probably low in funds in your escrow account, for this reason yes they can raise your rate. It is explained in detail at
Jessica | Nov 29, 2009 | Reply