PNC lied to us about mortgage loan recast

[Maestro]

Originally Posted by mbanks21

Thanks guys. We have many emails from multiple PNC employees saying this can be done, not one of them said "may be done". I feel like they only said this to get our business from the start. As mentioned above, PNC does not keep these loans, they sell them to the highest bidder which was some place called Blue Foundry Banking or some shit like that. I'm waiting for a call back still but we're super pissed. Yes we could easily take our loan elsewhere but it's still a major hassle and more paperwork to fill out.


And yes I'm sure we could easily take the $200k and invest it and pay the mortgage that way but I'd have to convince the Mrs.

When I read your post I thought they probably sold your loan and the new bank is who will not recast the loan. I am not sure if the new bank has to honor the recast request, the question is who is servicing the loan.

This is something everyone should know about loans and something I learned many years go and ever since I always ask if the load will be sold. I personally will not do a mortgage with a broker/bank if they immediately sells the loan. For the last 20+ yrs my mortgages and refi have been with Wells Fargo, (yes they do sell their loans, however, in my case, I am a long term customer and low loan risk they made it clear they would hang on to my loan. Even if they did they would always service the loan.

I only had one loan sold that I was made aware of, and did not have any issues, however, I read a number of horror stories. If you get a loan through a bank and they sell it, they can agree to keep servicing the loan, ie you keep sending the check to them and they pay the bank that owns the loan. To the borrower, they may never know the loan was sold.

The other situation is when they sell the loan and transfer the servicing of the loan to the new bank and thus you are notified and have to then make your payments to a new bank. This is the situation which causes people lots of problem and people got foreclosed on. This happen in 2008. There were stories of people making payment to the original bank for months and had no idea the loan was sold and they were suppose to make the payment to a new bank, or they were told and tried to pay the new bank and the new bank did not know they owned the loan.

This is not the only game they play today. I use to be able to make extra payment and have it automatically apply to the principle, can not do that today, it must be agreed upon up front for extra payments, you have to call and tell them to apply it to the principle, otherwise, they will just hang onto the extra and apply it when the next payment is due. I have be told banks do not allow all these things to make the loans more portable, ie more easily sold, it had to sell loans with all kinds of special arrangement on payment and repayment.

[mbanks21]

So got an update yesterday. PNC "bought" the loan back from company X that refused to recast and they will honor the recast request on Monday. Props to them for doing the right thing eventually but it still took a complaint to the BBB to light their asses

[stevenc]

Just a warning to others out there in a similar situation. These mortgages change hands often and quickly. Just because you took out a mortgage with PNC doesn't mean that's who owns it and when someone else owns it, the only thing that can be enforced is the actual terms of the contract, nothing verbal.

[Reborn_]

Originally Posted by stevenc

Just a warning to others out there in a similar situation. These mortgages change hands often and quickly. Just because you took out a mortgage with PNC doesn't mean that's who owns it and when someone else owns it, the only thing that can be enforced is the actual terms of the contract, nothing verbal.

Even if the loan stays put, verbal promises aren't worth much - if whoever owns the loan doesn't care about the customer or bad PR, they don't have to honor squat (although in OP's case, the extent to which he was misled is arguably illegal).

And a previous post called it out, but damn people, spend the hour and read every document. It sucks, but how often are you making such a huge financial move? I read every word of contracts related to my employment (income) or loan activities (expense). Only you are looking out for your own financial interest - "due" your diligence!

[Alfisti]

You guys down there, incredible at confusing the simple. The fact your lender can just tell you to go suck a bag of dicks and sell your loan to someone else is absolutely insane.

[dradernh]

Originally Posted by Alfisti

The fact your lender can just...sell your loan to someone else is absolutely insane.

I don't know. The mortgage fixed at 2.625% for 30 years that we took out at the end of 2020 and was bought by Fannie Mae doesn't seem especially insane to us.

I'm only a bit familiar with the differences between the Canadian system of regulating mortgages and the way we do it down here in the States. I suspect there would be a political earthquake if we didn't have access to 30-year fixed mortgages with no prepayment penalties –AND– we had to refinance every 5 years. I'm assuming the latter is still the convention in Canada. IIRC, the differences in the rights of borrowers and lenders are quite a bit different, too. An an in-depth analysis of the strengths and weaknesses of each system would be interesting to see.

I worked at a very conservative financial management firm in the late 80s, and it always had a small amount of CMOs in each client's portfolio. Choosing tranches of high-quality notes was the job of professionals. It wasn't rocket science, and the CMOs they chose yielded decent income. Lower quality CMOs were available to firms willing to take on greater risk in the hopes of realizing potentially higher returns for their clients.

[Alfisti]

I don't think one issue needs to be confused with the other though. The fact i can spend untold hours sorting my shit out with one bank then wake up the next to find it's been sold to another I never even herd of, is proper crazy and needless shit. Why confuse the simple?

[BMWCCA1]

Originally Posted by Alfisti

I don't think one issue needs to be confused with the other though. The fact i can spend untold hours sorting my shit out with one bank then wake up the next to find it's been sold to another I never even herd of, is proper crazy and needless shit. Why confuse the simple?

Back when we had a mortgage, I would regularly toss the monthly statement in the trash since it looked like an offer from a bank I did not do business with. In fact, my mortgage company had sold the paper—or the next holder would have sold the paper. So, when I'm living in VA and get a piece of mail from some USBank in MO, in the trash it went. No warning to me of having sold my mortgage. Seems quite normal, but not very well executed. Truth-in-Lending regulations should at least cover notification of your mortgage being sold to another lender.

[RickFLM4]

Originally Posted by BMWCCA1

Back when we had a mortgage, I would regularly toss the monthly statement in the trash since it looked like an offer from a bank I did not do business with. In fact, my mortgage company had sold the paper—or the next holder would have sold the paper. So, when I'm living in VA and get a piece of mail from some USBank in MO, in the trash it went. No warning to me of having sold my mortgage. Seems quite normal, but not very well executed. Truth-in-Lending regulations should at least cover notification of your mortgage being sold to another lender.

They do notify you in writing. Perhaps you threw it in the trash?

[G35POPPEDMYCHERRY]

Originally Posted by tdott

You need to read the terms and conditions of any mortgage or contract you sign carefully. Don't rely on what some person trying to get their commission told you.

just to add on to this, regardless of if they are getting paid or not 99% of people selling things are clueless to the nitty gritty terms and conditions

[dradernh]

We don't necessarily care who presently holds the note. As a practical matter, it's never been relevant.

Generally, what matters for those of us with mortgages is paying attention to communications from the entity servicing the mortgage. This is especially the case when they tell us they're handing that duty off to another servicing agency – from which you should soon hear that they're taking over.

It's not uncommon that the note holder and the servicing entity are the same. That is, the financial institution that issued your mortgage has kept it and is also servicing it.

Remember to notify the insurance company that issued your homeowners policy when there's a change in the servicing entity.