If you have ever paid a mortgage payment fee when paying for your mortgage over the phone or through an online website, then you should know that this may have been a violation on the part of your mortgage lender. Although these types of fees are common, they may be unlawful. Here’s what you need to know about these potentially unlawful fees and what you should do if you have paid them.
What Is A Mortgage Payment Fee?
A mortgage payment fee, sometimes referred to as a convenience fee, processing fee or phone/online fee, is a fee tacked on by mortgage lenders when borrowers pay through certain platforms (over the phone, online, etc). The most common type of mortgage payment fee that borrowers encounter occurs when paying via phone or online.
A mortgage payment fee may range in price depending on the lender in question. Most lenders charge between $5 and $15 per transaction, depending upon the borrower’s monthly mortgage payments. Some lenders may also charge more or less for paying on the phone versus paying online.
Why Do Mortgage Companies Charge Payment Fees?
Companies primarily charge these fees to defer the cost incurred when allowing borrowers to pay via credit card or phone. Some types of transactions will charge the mortgage lender a fee when processing the transaction. However, the cost incurred by the consumer is generally much higher than that which the lender paid for the transaction.
In most cases, a mortgage payment fee is unlawful. Most mortgage contracts have a stipulation against charging fees based on the payment method. Further, these types of fees typically violate laws which forbid unethical and deceptive business practices. The primary agreements that most mortgage companies use will only allow lenders to add fees that cover the exact, actual cost of processing a payment.
Your Rights as a Borrower
It is important that you understand your rights as a borrower making mortgage payments. Review your monthly statements and check for added transaction fees. If you are being charged unexplained fees or fees for paying online or through the phone, then you should first contact your mortgage company asking for clarification about the fees. This will help you obtain written evidence of the company acknowledging the fee, which can help you if you are entitled to compensation.
If you or someone you know has been charged a convenience fee on your mortgage payment, or you believe that you have been in the past, we want to hear from you and discuss your individual situation. You may reach us at (919) 526-0450 or through our contact page. Keep all documents and receipts regarding your mortgage and past mortgage payments to help assist us in evaluating your case.
We offer free consultations for most of our consumer rights cases, so contact us today for more information.