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Guardian Savings Bank review: Rip off

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6:12 am EDT
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Ive had my mortgage with Guardian Savings Bank for a year and a half now and my payments have been 616.00 (including taxes and insurance). I opened mail from them the other day and seen that my escrow account was negative 1475.00 and that starting November 1 our payment would go up to 838.00.

I called the bank and spoke with a guy who informed me that once a year they do a so called audit to make sure everything is correct and they noticed that when they figured up our mortgage payment that instead of adding our correct taxes of 1900.00 a year into our payment they went off of my grandmas (used to own the house) senior freeze tax rate of around 600.00 or so a year to calculate our house payment and he said it was their mistake they should have checked into that before the loan was finalized, he also advised something about when my grandmother purchased the home some 30 years ago that the appraisal value jumped up from then until now and that our payment with everything included should have never been 616.00 it should have been 715.00.

The piece of mail stated we had 12 months to pay off and speaking with the bank guy he advised we were one of their larger mistakes so he would work with us and divide it up over 36 months raising our house payment to 755.00. I am still not satisfied and would like to know why they didn't catch this at the end of last year or sooner and how can I now be liable for their mistake, I never would've bought the home if I would have known the house payment would be that much. Is there any advise or can anyone help?


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May 24, 2012 1:02 am EDT
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This problem of calculating the escrow amount is quite common to all banks. It takes about three years to get the amount correct. I'm in this industry and we see it all of the time. The first year is low, the second is high, the third is evened out. I suspect you would have had the same problem with any bank.

Mar 23, 2009 8:05 am EDT

First, you might want to try to challenge your assessment. Contact your local assessor's office and ask them about the process. If you are successful, your payment will go down by the difference between your current amount and the new amount divided by twelve. (1900/12=$158 per mo. they have to collect now, ex. new assessment 1750/12=$145 per month they have to collect to pay the new bill, savings of $13 per mo.)

This will also change the amount of your escrow shortage. Once your mortgage co. has the new info, have them recalculate the shortage, and spread over three years if necessary.

You may also wish to look into your insurance, if this is also escrowed. Once again, the lower your bills are, the less escrow you have to have to pay them, and the less your shortage will be.

To be optimistic about this, they are giving you an interest free loan of the difference of what they collected (the $600) and what they paid (the $1900 you spoke of).
Once this "loan" is paid back, the amount of the escrow shortage will drop off your payment, and your new payment will better reflect what you have to pay for the bills associated with owning your home, and shouldn't adjust much again unless your taxes or insurance go up drastically again.

Also, if you want to bite the bullet and pay the shortage upfront, your payment will go down to $715 now, though I understand this might be difficult in these times.