CitiMortage Scam

We have a couple of rental properties and we've been prepaying the mortgages on them so hopefully we outlive the mortgages. We got a letter this week from CitiMortage, who holds the mortgages, offering to give us a "great" deal on refinancing.

One offer they made was to refinance at a lower interest rate for 18 years. Our payment would go up by 60 bucks, but we would pay off the mortgage about five years earlier--they said. My wife was all ready to jump on it, but I sat down and ran through the numbers with her. It turns out that CitiMortgage had made a little fib. We don't have 23 years left to pay on the mortgage; actually it's 17 and a half!. (Although we had 23 years left on the ORIGINAL term, we've pre-paid five years worth of principal.) By refinancing, our payment would go up AND it would take an extra six months to pay off the mortgage!

I wonder how many people fall for CitiMortgage's little scam? I'll bet they have a program that cranks through their loans looking for folks who've made substantial prepayments.

Always crunch the numbers! One of the best tools you can have is a book of amortization tables. I can easily crunch the numbers using a spreadsheet, but there's nothing like having the numbers laid out in the tables of the book.

My daughter wants to sell her car. Blue Book is $7000 on the car and she owes $8000 to the bank.

She has a guy who will buy it for $7000 and wanted to know if I could loan her the $1000 to get the title for the guy.

I said that can't be. She said yes the bank says she owes $8000.

I said ask the bank what the pay off is? She did and that is only $6800 when you take off the future interest. She was ready to pay $8000 to get the title and the bank would have taken $8000.

Know your money matters.

Gary

and your refinancing costs probably would run $5,000-6,000.

That's just one of their ploys, and not even a new one. They are just working it a little harder to collect another set of processing charges.

Yep, These same banks are down to 7/10% interest on Money Markets... Tempting to just put cash in a safe deposit box..

Had considerable dealings with Citimortgage. I reccomend you take your business elsewhere

Hey Mark. I have gotten a few of those scam letter too. I received one a few months ago that says........Pay your mortgage twice per month and save....Bull$hit! I only get the check book out once per month to pay usually only 3 bills at the most, the wife pays the smaller crap, like garbage collection, electric bill, credit card bill, etc.

I will have my home paid off in April 2018, my son will be 2 months from finishing the 11th grade at that time. The best way to take out a mortgage on a home you own/live in for yourself and most other cases is to have a 15 yr. fixed rate. The Amortization tables are your friend.
Any bank is not your friend.
I also have citimortgage, they bought my mortgage from another bank.

A year ago I was walking out of my bank after depostiting my paycheck and this broad at a desk steps in front of me and says "would you like to take out a home equity loan" I looked her straight in eye and said, I loan money to YOU, through my CD's, I dont take out loans because I have my own money..........SEE YA.....I was a dick about it but I dont care.

Total refinancing costs would have been about $2300 on a $52K loan principal; a whopping four percent.

The biggest banks are the worst offenders.

A small bank or a credit union is much better.

We have to stop being willing victims.

Big banks make a trilion dollars a year in unfair
policies. The Govt will not help you. We all must act to defend ourselves.

I'm spending mine on antique tractors,I think it's a better investment.

Does your principal balance reflect the extra principal payments? Many banks don't know how to handle extra principal payments, so you need to make sure that they are doing it right. They should be deducting the extra principal from your balance every month- I'm troubled by your saying you've prepaid 5 years of principal, as they may still be charging you interest on that extra principal if they're not actually deducting it from the balance every month.

The above sounds confusing- let me know if I need to explain it better.

The balance is correct. But CitiMortgage is comparing the original payment schedule to the proposed refinancing, which makes it appear that the number of payments would be reduced when in fact they are increased. Oversight on their part? I think it's deliberate deception.