returned/rejected mortgage loan payments

This is a discussion on returned/rejected mortgage loan payments within the Mortgages, Refinancing, Foreclosure forum, part of the Buying & Selling Property category; We fell a month behind almost immediately after we bought our house due to unexpected health problems which occurred while ...

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Old Feb 19th, 2010, 07:46 PM   #1
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Default returned/rejected mortgage loan payments

We fell a month behind almost immediately after we bought our house due to unexpected health problems which occurred while we we waiting for loan approval. The lender would only accept full payments, no partials - say, if it's the beginning of July and I have the previous (June) payment and half of the next month (July), the lender would not take what I sent them - they wanted us to wait until we could send in two complete payments. I actually had funds returned by them (one was a personal check and another time it was cash I'd wired to them) because the payments were not quite the full amount due. I'd sent them anyway, thinking that something was better than nothing and certainly more attractive than falling further behind. This has been happening for quite some time, and now we're facing foreclosure. We've spoken with friends & associates, none of whom have ever heard of any lending/payment practices such as this - not accepting less than the full amount due.

Has anyone here ever encountered this ? At this point, it sounds like because we were first-time homebuyers and apparently quite naive, we should have questioned this a while ago. We'd thought that this was how all mortgage lenders worked - but now we find that maybe it's not us but them ? Are there lenders that would rather wait, for example, for two complete payments instead of taking the one and a half we sent ?
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Old Feb 19th, 2010, 10:27 PM   #2
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Default Re: returned/rejected mortgage loan payments

I wish to inform you that your loan agreement governs your contract. Now generally the debtor can pay a partial amount also and can specify that the payment is to be applied towards debt. However, in case your agreement specifically mentions that payment will be of whole amount and not less then the agreement provisions will be followed. For this agreement should have specifically mentioned this fact that part payment cannot be done. Further, in case you send part payment then also you will remain liable for the unpaid portion of the installment.

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Old Feb 22nd, 2010, 03:43 AM   #3
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Default Re: returned/rejected mortgage loan payments

It's highly unusual for any lender to refuse to accept ANY payment over NONE. Consult an attorney and report your lender to the Fair Trade Commission.

You must consult an attorney in your area, and do it quickly. Something is not right there.
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Old Jun 20th, 2012, 02:20 AM   #4
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Default Re: returned/rejected mortgage loan payments

While it may be unusual for a mortgage company to reject a payment that is less than the total amount due, they have absolutely no obligation to accept it either. Mortgage companies are now less likely to accept partial payment if there is a history of outstanding payments or payments of less than the full amount when due.

In these days of economic troubles, it is more important than ever to keep in contact with the lender and actively communicate with them if there is an issue. They will let you know what their policy is regarding partial payment, and will advise whether or not it is a good idea to even try making one.
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Old Jun 20th, 2012, 12:01 PM   #5
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Default Re: returned/rejected mortgage loan payments

When a lender rejects payments, they intend to foreclose. Once a mortgage becomes more than 30 days in default, as many mortgages are written, the lender may refuse to accept payments.

The custom has been "30 days" they report it. "60 days" they send it to their legal department in anticipation of foreclosure. "90 days", the mortgage is officially in default and they do not accept any more payments.
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