Homeowners across the country, including eastern Suffolk County, woke up to a shock this morning when they learned their mortgage servicing agency had withdrawn multiple payments from their checking accounts overnight.
Payments to the Texas-based mortgage servicing company known as Mr. Cooper left checking accounts overdrawn and people unexpectedly without access to their money.
Consumers whose mortgages are serviced by Mr. Cooper, a DBA of Nationstar Mortgage, took to Twitter and Facebook to complain and demand answers from the servicing company. They all had similar complaints: They’d been notified by their bank this morning of large overdrafts following the withdrawal overnight of multiple mortgage payments to Mr. Cooper that were neither due nor authorized. They were all customers of Chase Bank.
Calls to Mr. Cooper’s customer service line were not answered, they said, and Chase customer service and branch office employees could provide no explanation for what had happened.
One local woman, who asked to remain anonymous, said when she went to her branch office shortly after it opened, she was told numerous other customers had already called or come in to complain. Many were frantic.
“They hit my account for five mortgage payments — five — which totaled more than $10,000. When I looked at my email on my phone this morning, I thought I was seeing things. I had no funds and was overdrawn by several thousand dollars,” she said.
She said she doesn’t have automatic payments set up for her mortgage and, in fact, doesn’t even make her payments online.
Her Chase branch officer in Shirley said the bank couldn’t do anything about it until Monday. The bank could not reverse the charges because they were still “pending,” she was told.
“I was charged 6 unauthorized mortgage payments and over $7k in overdraft fees from @Chase! IT IS NOT ON AUTOPAY!!!! Its called stealing and that’s f*cking criminal,” tweeted Sean Fierst of Colorado.
“Amen my friend,” replied Twitter user Misthios87. “My sh*t isn’t on auto pay either. I’ve got no money to buy groceries. None of us do. Wtf @Chase????? How do you let this happen?”
By midday today there were many dozens of similar complaints on social media.
At about 12:30 p.m. EDT, Mr. Cooper posted to its own social media accounts: “We are aware that some customers are experiencing payment issues today. We understand how concerning this is to those impacted, and we are working with the banks involved to resolve the issue as quickly as possible.”
That statement sparked a new round of angry comments by people outraged by the company’s description of what had happened as “customers … experiencing payment issues.”
Michael Agruss, a consumer rights attorney in Chicago, said unauthorized deductions like those being reported today, are potential violations of federal and state consumer protection laws. The federal Electronic Fund Transfer Act prohibits unauthorized withdrawals, he said. It provides for statutory damages up to $1,000 plus actual damages.
“Every state in the country has an Unfair, Deceptive or Abusive Acts and Practices (UDAAP) law,” Agruss said.
A unauthorized withdrawal that depletes a consumer’s accounts can create a situation that “can easily spiral out of control” and negatively impact their credit, he said.
Even if the funds are returned to the consumer’s accounts Monday, “there’s still recourse,” Agruss said.
“Consumers have rights,” he said.
Anyone who has had this happen to them should file complaints with their bank and Mr. Cooper, Agruss said. “It’s important to follow up a phone call with a written complaint — and keep a copy. I can’t stress that enough,” he said. “You want to have proof in case a past-due payment shows up on your credit report in the future.”
Agruss said everyone should monitor their credit report, especially after something like this happens.
“Make sure it doesn’t affect your credit report,” he said. He noted consumers can get free credit reports from all three credit reporting agencies at annualcreditreport.com.
Mr. Cooper issued the following statement this evening:
“Mr. Cooper learned on April 24 that a payment processing issue at our electronic payments vendor resulted in a number of customers experiencing incorrect mortgage payment drafts from their bank account. All unauthorized charges are being corrected, and any impacted customers will not be responsible for any fees or other negative financial impact this may have caused.
“Mr. Cooper values the trust our customers place in us, and we sincerely apologize to those impacted. Since the incident, we have been working directly with the banks involved and the payments vendor to resolve this issue as quickly as possible. We expect this to be resolved no later than end of the day, Monday, April 26.”
Editor’s note: This article has been amended after its initial publication to include a response from the mortgage servicing company Mr. Cooper.
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