Help save our credit!

February 3, 2007 11:01 AM

Help us save our credit! We're not sure why, but our mortgage company started returning our automatic bank payments a few months ago.

We were abroad for some of that time, and didn't realize this was happening. All of a sudden, we're in foreclosure. We have the money (since they sent it all back) and are trying to get the company to reinstate the loan. But our biggest concern is our credit.

So far our credit report only reflects past due payments, not the foreclosure. How can we protect our credit and remedy whatever damage has already been done?

posted by anonymous to work & money (6 comments total)

Talk to a lawyer.

(I am not a lawyer, by the way)

Depending on your circumstances, you may have legitimate cause for action against one or more entities.

Be aware, however, that your sustained ignorance of the situation *could* mitigate whatever recompense you may be owed.
posted by The Confessor at 11:49 AM on February 3, 2007

Don't worry about your credit - first protect your property.

First rule of engagement in situations like this - document EVERYTHING - and that means write letters.

I'd send a letter detailing the entire situation with as much supporting evidence as possible - for example, any bank statements that clearly show the funds were indeed sent however were returned by your counterparty.

Note that this is taking up your valuable time to resolve. Demand an explanation.

Do all of this in writing and, perhaps most improtant of all, send these letters in such a way that the recipient must sign (in the UK it's Recorded Delivery, get the same wherever you are).

Every time you have a conversation, take names then followup each phone call with a letter detailing who you spoke with, when, what was discussed and next actions on either side. Then follow through, especially if you were asked to provide information.

Whenever you write a letter note how much of your time this situation is taking.

Hopefull this will clear things up but if not, and if you've got to get legal representation, at least you've got formal documentation of your good faith efforts to resolve this situation - that was NOT of your own creation.
posted by Mutant at 11:57 AM on February 3, 2007 [1 favorite has favorites]

Once you get the foreclosure situation worked out, you should be able to get the bank to remove the lates on your credit report, since they are the bank's fault, or at the very least, agree not to respond to any requests for verification from the CRAs.

creditboards.com is a good resource for this sort of information.
posted by wierdo at 1:26 PM on February 3, 2007

First you need to find out why the mortgage company started returning your checks! This is the crux of the issue. It makes no sense. Was your loan sold to another bank or something? If this is their mistake then it is their responsibility to correct it.
posted by bkeene12 at 2:00 PM on February 3, 2007

I used to work at a bank and saw this happen many times. While we were unable to get the payments paid for them, usually the mortgage companies were good at fixing this stuff with moderate prodding and proof that you attempted to make the payment via automated means (which we the bank could often provide if not for free, for next to free.)

If you haven't been told what went wrong by either your bank or your mortgage company, check and make sure your payment didn't change, even by the littlest amount. We'd often have mortgage payments rejected back to us when we attempted to pay them through our bill pay system because the amount we were paying didn't match the amount due - any variation was enough to send the payment back to us, even as little as a penny. It's worth checking into if you need figure out what happened going on.

Once you've established what's going on, and have proof of your attempts to pay the bill, you shouldn't have too much trouble getting them to fix things to make it all right - but like everyone says, that's secondary; avoid the foreclosure RIGHT NOW at any cost.
posted by plaidrabbit at 2:01 PM on February 3, 2007

do all of the above, but also make sure to get documentation on bank stationery that you were making the payments. not sure how helpful this will be ultimately, but it can't hurt (i'm not a lawyer).
posted by thinkingwoman at 8:36 PM on February 3, 2007