Greetings fellow GI's I rarely post and am usually happy to "lurk" as I have an aversion to being burned at the stake for voicing my opinion. However, I realize that my tender feelers are my own cross to bear and try to buck up sometimes. But, a situation has come up in my family and I would like to pick some of the fine brains that are here. Here's the scene: My brother and his wife having dared hope they would have a secure old age (they are 50), have been making double house payments for almost 2 years. Their payments are now up into June or July of 2000. For the past six months or so they have been having problems with their statements. He would call and get the runaround. He has had to do his own calculations to make sure they were applying the correct amounts to his interest. Last week he was given a number to call and when he did so the woman he talked to was very irrate that her number had been given to him. After a lengthy discussion she finally admitted that his account was FROZEN. She also admitted it is due to Y2K. All of the payments the last 6 mo. have been credited to the principal, nothing to the interest. They can't even access his account. They can repossess his house because of non-payment of the interest. "Of Course,no such action would ever be taken."("Trust Me", she said, reassuringly.) What do you all think of this? What should they do to protect their home and investment? I think he should get a lawyer yesterday. I am having him write all this down. Do you think this is something Mr. Yourden would be interested in hearing? This is the first real Y2K mess up I have seen. You alls input would be appreciated. Thanks

-- Juniper (need@input.com), March 01, 1999

Answers

Absolutly positivly get a lawyer last week. Document everything. Get all your papers and especially the cancelled checks together and lock them up safe. Tell the attourney that you want your rights protected and you want to start an offensive against the company to preempt any stupidity on their part.

The Lawyer will say no publicity. I will argue this is one thing you must digress from in his advice. You want to be a cause celeb so they don't dare do something stupid with you.

Look, people have lost house and home for far less than this. In most caes they have been stonewalled by mortgage companies and banks that have held all the cards. (and the house)

Who in your area is there that would enforce an eviction? The Sheriff? I suggest you copy everything and drop the bundle on his desk along with notice that there is a problem and you intend to be VERY public about any actions. Not as a threat, but just to make them aware there is a nest of snakes here they might want to back burner till it gets settled.

Look, this is simple. When someone at a bank or a large company tells you not to sweat the paperwork, you can just trust them, you should run screaming straight to your lawyer. Better yet, call your lawyer right from the companies office with their rep right in front of you. Do it on your cell phone. Even if you just get the lawyers secretary have her write everything down as you relate what the company says.

DON'T JUST TRUST THEM!!!!!

We Have BEEN THERE and DONE THAT!

-- Art Welling (artw@lancnews.infi.net), March 01, 1999.

Just wait until 100 million families are going through this situation next year. Laws are being passed as we speak to allow mortgage co./banks the right not to be responsible for any Y2K related disruptions. Laws are being blocked as we speak to keep your brother (or anyone else for that matter) from sueing for disruptions caused by Y2K related problems. It the classic case of "Screw the people" the corporations are always right.

This will trigger great panic, then anger. What do you think folks will do to Corporations and businesses when they find out that they are being foreclosed even though they have done the honest thing by paying the bills. What will happen when people realize that it was the corporate & Gov't executives that got us into this mess in the first place through sheer GREED.

I agree with Art - I would go public ASAP - People with mortgages who have been paying all along (should) become outraged and back you.

-- Matt (Butenam1@aol.com), March 01, 1999.

You didn't mention what form the mortgage holder is. Credit union, mortgage company, state chartered bank, federally chartered bank?

Have him contact whatever the state agency is that polices financial institutions in his state and report this. Contacting a state senator to find out the proper state office would be the place to start, they usually have an office in the district/ward to handle voter questions.

-- Ken Seger (kenseger@earthlink.net), March 01, 1999.

Attorney and reporter, in that order, 25 minutes apart. Then have the atty write a letter, TODAY to the lender, explaining that HE wants the asurance that your brr got and he wants it IN WRITING AND NOTARIZED, SIGNED BY THE CHIEF COUNSEL for the lender. Anything less and the lender will see a suit (and even then he might still get shafted)

Chuck

-- Chuck, night driver (rienzoo@en.com), March 01, 1999.

Juniper, many journalists are looking for juicy sensational Y2K bomb-tocks like this to give impetus to their Y2K articles.

Your brother will have success getting his story told and thus his investment protected.

Rob Michaels on this Forum has a List of snafus which is being circulated amongst the media; some more details may get this incident on his list :-)

Be sure to send this thread to: Steve Woodward, the Oregonian reporter who does his homework and cites bug-bite examples.
You can reach Steve Woodward at 503-294-5134 or by e-mail at
stevewoodward@news.oregonian.com.
The fax number is 503-294-4079. The regular mailing address is 1320 S.W. Broadway, Portland, OR 97201.

For an example of Steve's reporting, see

Portland isn't afraid of telling the facts - article on front page of the Oregonian

All the best to you & yours in the sticky battle.

xxxxxxx xxxxxxx xxxxxxx xxxxxxx

-- Ashton & Leska in Cascadia (allaha@earthlink.net), March 01, 1999.

They should get an attorney right now. Any further phone calls to the company should be taped (let them know you are taping first thing) They should demand a complete accounting of their account from day one.

I have warned everyone that automatic insurance payments taken from your escrow accounts have been screwed up this year. The insurance companies may charge you for 2,5,10 years worth of coverage and your mortgage company will pay it and bill you. This kind of mess is a pain in the butt to deal with, and it can take months to straighten out. Be sure to watch those escrow payments this year.

-- Bill (y2khippo@yahoo.com), March 01, 1999.

List of Y2K failures - Here is proof

xxxxxxx xxxxxxx xxxxxxx

-- Leska (allaha@earthlink.net), March 01, 1999.

If they come and take my house, I will hook up my truck to all the plumbing inside the house, cut every electrical wire in the house, punch holes in the walls, stuff frozen sardines in between the walls, pour paint on the carpets, break every window in the house, remove every door in the house, that's my sweet revenge!

-- PO'd (Po'd@Poed.com), March 01, 1999.

They've worked too hard to risk the bank's snafu taking months to correct. Agree, lawyer, media (local consumer advocates) and would also copy complain to the State Banking Commission. Once resolved, don't forget to watch credit report - get a copy after a couple months to be sure they haven't sent any bad info that requires retraction.

Good Luck jh

-- john hebert (jt_hebert@hotmail.com), March 01, 1999.

I've started a new thread that relates to this. While I agree with the lawyer/media advice, we all know that lawyers can be expensive, and the media can be wrong? My question is: will we see more of this? If you think the answer is yes, then I'd appreciate reading your comments on the thread entitled "Citizens Lobby for Y2K Consumer Protection."

Here's the original post to that thread: ____ Ever since I learned that Illinois Democratic Representative Constance Howard is sponsoring a bill in Illinois to protect consumers from Y2k (losing their houses, etc.), I've been wondering who--among our 100 U.S. Senators--would be willing to step up to the plate and do the same for the rest of us?

After all, if companies are allowed to escape Y2K related lawsuits, shouldn't we--the people--also be protected from their potential Y2K mistakes?

I wonder what sort of protection would be needed and which senator would be most willing to introduce legislation? Anyone in your state? Not much time left, which is why I think the Senate would be best because it's more powerful. Contact would need to be made soon. I've thought about approaching a senator from my state but don't know exactly how to word the letter.

FYI: Constance Howard's email address is choward@housedem.state.il.us

Suggestions?

-- FM (vidprof@aol.com), March 01, 1999.

Is there any reason you can't give us the name of the mortgage company involved here?

-- Puddintame (dit@dot.com), March 01, 1999.

Hmmm. Do y'all always fall for these stories around here?

-- Skeptic (Skeptic@storytime.com), March 01, 1999.

Regardless of cause (Y2K - related ? - doesn't make specific sense here based on the symptoms, but it doesn't matter, the mortgage company brought it up, not the homeowner) - this is an extremely serious matter because of the length of the delay - "the missed payments" and the apparent misappropriation between principle and interest.

I agree - get a real estate lawyer on this "last week" - get one recommended by a trusted real estate agent - don't just use a regular attorney because it is a speciality case that 'smells bad". Don't look for publicity just yet (in my opinion) because nothing has happened yet. Also, don't go tripping over the sheriff's desk - because it's not his job to tell a mortgage company who has paid and who has not.

However, get a definitive statement from your county about taxes and the exact status of your escrow account for taxes: the sheriff (if investigating) may find you have not paid the right amount of taxes either - regardless of mortgage fees or apparent withholding.

I am not one to like lawyers - but you need one here to be sure you are protected.

Second, go over your payments with someone (your bank ?) to find out what should be credited, what is the predicted principle, the predicted interest, your actual interest, your home mortgage deductions for tax year 95, 96, 97, and 98; and what should have been claimed - if they actually failed to apply this money to interest, you should not have gotten a 1099 (right form number ?) showing interest paid -> you will need to file a revised 1040 and schedule A for those years. This change in a 1040 will affect state taxes too. (Probably want to use a tax program to help make forms and recalculate payments. It would take a while by hand.)

On the other hand - if they sent a 1099 for the right amounts for those four years, then they did apply it to interest according to the IRS, and so they cannot claim money due.

-- Robert A. Cook, P.E. (Kennesaw, GA) (cook.R@csaatl.com), March 01, 1999.

This thread is unerving, and I noticed that Juniper hasn't had a chance to respond yet. I too am very interested in knowing the name of your mortgage company Juniper, it might alert some of us here to the same problem we might unknowingly have.

-- Chris (catsy@pond.com), March 01, 1999.

hehe..methinks you'll be waiting awhile for Juniper to respond

-- Skeptic (Skeptic@storytime.com), March 01, 1999.

Juniper,

Your post is not clear as to what the situation is. Something here doesn't make any sense. Did your brother pay additional principal (common) or additional future payments (much less common)?

If he paid additional principal, then his loan balance will have declined commensureately, the principal amount of each payment will have risen, and the interest portion of each payment will have declined, though the payment will remain the same.

If he made future payments, then his loan balance will amortize according to its schedule, though he would have the option of not having to make any payments until all future payments have been allocated.

When you say, "their payments are now up into June or July of 2000", it sounds like they've made future payments and not paid down principal. In this case, I don't think they'd see any changes in their scheduled amortization.

If they did pay down principal, then that's eaxactly how the money would be allocated -- to principal only. Does your brother know the difeerence? Or did he do a combination of the above?

-- Nathan (nospam@all.com), March 01, 1999.

Skeptic, being gullible and researching a subject is nowhere near the same. Unless YOU are Juniper and wrote this as a troll post, how can you and me be sure there's not some truth to that? That's why we need the name of the company. If Juniper doesn't return, then this thread will go into oblivion. But I still got valuable advice from Art, Chuck , Robert et al should anything like this happen to me.

-- Chris (catsy@pond.com), March 01, 1999.

Much as I hate them, as they represent the absolute biological and evolutionary equivalent of waste...Get a lawyer!

We have our entire legal staff, at the corporation I work at, on standby, ready to file against all companies that we currently are doing business with (which include 15 F500 superpowers). The reason? We feel that all of them will breech the contracts that we have with them in Jan-June of 2000. Why should our company be put out of business because of their incompetence?

On an individual level, we are already holding the papers, awaiting our signature, to sue the company which holds our mortage depending on the outcome of legislation that the U.S. Senate is considering. If the company is "shielded" from lawsuits due to Y2K, we have another option ready: Bankruptcy. We will default to our creditors in December of 1999, causing mass confusion on top of the confusion created by Y2K. It may sound like a cold, cheap way out, but think about one thing: WHAT THE HELL WOULD ALL THE BANKERS DO? REPOSSESS THE WORLD? It's funny as our attorney laughed as we discussed this option. Yes, we are paying our bills down, but if the Senate passes this bill, we are going to heavily leverage ourselves (to purchase gold and silver of course with cash) then default. They won't be able to evict us. The courts will be in dissarray for at least five years. And they will be left holding nothing. It's a destructive option, but viable if the banks decide to play hard ball in court, which I imagine they will.

MY POLICY FOR Y2K:

SOCIETY IS BANKRUPT. SO LET'S BANKRUPT THOSE THAT CREATED THIS MESS.

Live long and prosper. And for God's sake, whoever your God may be, hide your assets!

-- John Galt (jgaltfla@hotmail.com), March 01, 1999.

Sorry it has taken me so long to respond to your great comments. I had to leave town for a seminar. I assure you that this is on the level. I don't know the name or kind of lending instution he is going through. I didn't realize that it would help you answer. I am going to have to get the facts from him and respond tomorrow. You are wonderful with all your advice. I really appreciate it. Talk to you tomorrow.

-- Juniper (need@input.com), March 01, 1999.

I respectfully disagree John - you, me, and these companies have a moral responsibility to pay our just debts, regardless of whether we "like" paying them or not. The case here appears to be a (potentially trajgic) case of incompetence on the part of the company, inattention (?) on the part of the payees, and a possible computer program error compounding things.

-- Robert A. Cook, P.E. (Kennesaw, GA) (cook.r@csaatl.com), March 01, 1999.

Hi, Juniper. I think the regulator would want to know about this. FDIC, OTS, OCC, the Fed, the state, et al are looking at Y2K and have been "assured" that the lenders will be compliant. ;) Something like this will interest them, you bet. A home loan is "consumer" and thus falls under some VERY persnickety lending regulations, and your brother has the right to complain to the regulator. Get a lawyer, yes, and also complain to whomever is examining that lender.

Sounds to me as if they treated all of those early payments as special principal payments and will be expecting another monthly payment come January. Your brother probably still has negotiating room to get some of the funds re-allocated to regular instalments. The lender can re-open the books if they have the right "persuasion". All is not yet lost. It's a good thing you told your brother to keep a paper trail; lawyers like that and so do the regulators.

-- Marge (I@is.one), March 01, 1999.