December 6, 2019
There may be circumstances where you find your mortgage payment has increased. There are several reasons why a mortgage payment might increase; regardless of which issue may be affecting your loan it’s crucial to address it right away.
Mortgage Payment Increases Due To Interest Rate Adjustment
If you have an FHA Adjustable Rate Mortgage, your mortgage payment increases when there is a scheduled interest rate adjustment on the mortgage.
The government watchdog agency known as CFPB, the Consumer Financial Protection Bureau, advises, “Some homeowners believe that they have a fixed-rate mortgage loan when their loan actually includes an adjustable-rate or some other feature that can cause their interest rate and payment to change.”
Changes To Your Property Taxes
If you notice an increase in your mortgage payment, check your monthly statement to see if there’s been an increase in property taxes.
If you have a mortgage that includes monthly escrow payments, higher property taxes could be a reason for the higher monthly payment. In some cases, a payment may actually go down if property taxes were lowered (unlikely, we know) or you were able to claim certain exemptions in a given zip code.
Changed Lender Fees, New Lender Fees
Did your lender introduce a new fee or adjust an old fee structure that resulted in a higher mortgage payment? You may need to call your loan servicer to learn how the new fees work, or why they were applied.
In some cases, you may find federal regulations are to blame for changing bank procedures. In others, it may be a matter of adjustment to the lender’s requirements.
Sometimes The Lender Makes An Error
Sometimes a mortgage payment goes up because of simple human error. If you suspect your lender has made a mistake, contact your loan officer immediately, but be sure to take the name and reference number (where applicable) for anyone you speak with regarding the problem.
That information will be helpful if you are unable to get a resolution immediately and can help your lender sort out any miscommunication or related problems.
The Consumer Financial Protection Bureau advises borrowers to send something called a notice of error to the financial institution, “explaining why you think it made a mistake in calculating your loan payment”.
You will need to send this notice to the proper address–the one your lender advertises as being available to make disputes or request further information and note that this address may be different from the address where you send your payments.
Bruce Reichstein has spent over three decades as an experienced FHA and VA home loan mortgage banker and underwriter where he was responsible for funding “Billions” in government backed mortgage loans. He is the Managing Editor for FHANewsblog.com where he educates homeowners on the specific guidelines for obtaining FHA guaranteed home loans.
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