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Mortgage refinance / ileagal practice

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In. Feb, 2008 we refinanced our home through Castle Point Mortgage. At the closing we signed a document that indicated a flood determination was completed prior to the closing, and it indicated that we were NOT IN a special flood hazard zone. In April of 2008 we received a letter dated 3-29-08 indicating that CitiMortgage was now servicing our loan, beginning 5-1-08. It stated that the terms of our loan were not changed, just the terms related to the servicing of it (collecting the payments). Then in May 2008 we received a letter dated 5-5-08 from CitiMortgage Insurance Center telling us they determined we were in an AE flood zone and had to have flood insurance.

We reviewed our closing records and did not see a copy of the determination completed in February, 2008 prior to the closing. Our papers only had a document stating one was completed and it determined we were NOT IN a flood zone. We already knew we were not in a flood zone because we had a flood determination from our previous mortgage company completed in March, 2006 indicating that we were not in a flood zone. We faxed the 3-14-06 determination from our previous lender to the CitiMortgage Insurance Department on 5-28-08 requesting a re-determination. They replied back with a letter dated 6-10-08 stating they completed their re-determination and based on THEIR determination, our property was in the AE zone. They included a copy of their determination and a mapping exhibit completed by First American Flood Data Service, completed for them on 4-3-08. Upon receipt of these items we compared it with the 2006 determination we had from our previous lender. The determination done by First American Flood Data Service on 4-3-08 used the exact same FEMA map as the determination we had in our file dated 3-14-06. It referenced the same NFIP Community Number 170357, Panel No 17097C 0019F, and revision date 9/3/97.

We responded back to them 6-18-08. We drafted another letter with additional documentation including elevation charts from the county, and FEMA, and a copy of our plat of survey. We were disputing their mapping exhibit, which was an aerial picture of our property with the FEMA Firm map overlaid on it. We state that we were certain that their determination company did not accurately place the FIRM map over the aerial picture, therefore incorrectly showing a small portion of our structure in the AE zone. We never received a response from them after that. They forced placed, and purchased the flood insurance. We received an escrow notice dated 8-20-08 showing they took the $2250 premium from our escrow account for flood insurance, and our monthly payments into escrow were now going to increase by more than $600 in order to make up the shortage. This alarmed us because we can not afford another $600 a monthly obligation. We now sent copies again of everything they never responded to in June 2008 directly to CitiMortgage Flood Services on Sept. 11, 2008. We obtained this contact information by doing a little more research. I contacted CitiMortgage Flood Services and told them the information was coming and to PLEASE get this re-determined properly, as we were now in jeopardy of loosing our home because this additional $600.00 monthly cost was not in our budget. They assured me they would take a look at the information we would be sending. For additional reference we included in this package a LOMA issued in 1999 that our neighbor gave us, showing indicating his structure was removed from the zone. It so happens that his structure sits even closer to the actual zone than our house does, evident in any aerial photo.
We asked them to review this information they claim was never received back in June, and reconsider their determination as incorrect, and accept the one from 2006 as correct. We called to followup with them on 9-17-08 spoke with Marlena and were told they received the overnighted package of information and were working on it. We have made several calls to CitiMortgage Flood Services and left messages but nobody returns our calls. They refuse to respond to our requests. They clearly feel that they have the upper hand, and do not want to admit that their flood determination is wrong, regardless of what information we send them for review.
Based on research we have done, a mortgage company has to make a flood zone determination prior to the loan closing, and that the flood insurance must be in place before the closing. Had we been told that within 2 months of closing our new loan the new servicing company could arbitrarily force us to purchase unnecessary insurance, we would not have gone through with the refinance.

The previous owners of this property were never required to have flood insurance, and when we bought the home we did our home work, knowing that we were close to water, we made certain the proper steps were taken so we were fully aware of all insurance expenses before we purchased the home. We knew it wasn't in a flood zone based on the determination done in 2006.

If the FEMA maps used in both determinations (3-14-06 and 4-3-08) are identical, and our neighbor has a LOMA removing his structure from the flood zone dated 1999, and out structure has NEVER BEFORE needed flood insurance, WHY does this company have the right to force place insurance just because their determination company "First American Flood Services" refuses to admit their determination is incorrect. We feel that they First American Flood Services relied solely upon their aerial overlay map in making their determination. We have read about these aerial overlay maps, and it is noted that they can be off by 500 feet or so. In our case an inaccuracy of 500 feet is costing us $2250 a year, or $600 a month, which is way out our budget. We are seeking the assistance of the States Attorney’s office, asking that you contact CitiMortgage Flood Service to get this forced flood insurance decision reversed, and to request the money taken from our escrow account be returned. They are not responding to our calls to get this resolved. They are playing with our ability to afford our home, and that is not right, especially when they have not followed the guidelines to begin with.

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