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Unfair PMI-MGIC/Everhome/Fairway Mortgage
In May 2006 my wife and I wished to purchase a home. We had poor (not horrible) credit so instead of choosing a bank went to a mortgage broker Fairway Mortgage in Baraboo WI. Jeff Schlender, the mortgage broker at Fairway, developed a mortgage for us and informed us that we would have to pay a higher interest rate (7.45%) because of our poor credit scores. We accepted that as reasonable. At the closing we noticed a PMI had been attached to the escrow in our mortgage. Jeff said that was standard for people with poor credit. What did not seem standard to us was the amount of the PMI ($629 per month). When we questioned this he said not to worry that it was just temporary and would be removed in a matter of months. That did not happen. We continued to pay our mortgage plus the awful PMI until I was laid off. I am a crane operator and lay offs occur in my business. My wife's income and my unemployment made making the mortgage with the enormous PMI near impossible. When we realized we were not going to be able to make our payments my wife contacted an Organization called the Elect group that said they would assist us in getting a mortgage modification and get rid of the PMI. The Elect group said not to make a payment until they had time to pressure the lender into a restructure. We had paid the Elect group $1850 for their service. My wife called the Elect group repeatedly and they asked for more information letters explaining our hardship, copies of documents etc. About the third time they requested the same information we became suspicious and confronted them as to whether they were really doing anything. That is when we found out they had closed up shop and were wanted on fraud charges in several states. We caught our mortgage up and struggled to keep payments on time. We could make the mortgage amount on my wife's income but not with the PMI. We asked Everhome mortgage if we could make the mortgage minus the PMI temporarily and they said no that is not how it works. When we asked about the PMI they referred us to MGIC (the mortgage insurance company) and when we talked to MGIC they referred us to Everhome. My wife has made over 200 phone calls to Everhome, MGIC and anyone she could think of that might help us. My wife has been a Medical Technologist for 31 years with a B.S. from Michigan State and a Masters degree in Business from the University of Phoenix. She is the Laboratory Director at St. Clare Hospital in Baraboo I am an Operating Engineer local 139 crane operator with a B.S. from South Dakota State in Brookings, South Dakota. I have taught school at high school level on the Navajo reservation in Northern Arizona. We are intelligent people with a strong sense of moral and civic duty yet we are the victims of an obvious extortion scheme. MGIC (the PMI company) has taken over $27000 from us. This money does not go toward our mortgage or anything else it is simply cash to line their pockets with. We love our home and do not wish to lose it but we don't know how to get out of this mess. Finally they suggested we attempt to qualify for the "Obama program". Yes, that is what they called the forbearance program. We entered the forbearance program not realizing that though our payments were reduced Everhome was basically taking the money we sent and sitting on it until they had enough to make a payment and then making a payment all the while reporting our mortgage in default and preparing foreclosure papers. We were contacted by an attorney that had seen our house entering foreclosure. When we realized what a mess we were in we hired the attorney (paid $3000) to have him assist us in removing the PMI. Meanwhile, my wife had been investigating what a reasonable PMI should be for a mortgage of our size ($180,000) with poor credit (500 scores) most of the people she spoke to felt $150 to at most $200 would have been reasonable. Our credit has been ruined by the "Obama Program" so we can not go to another lender. Our attorney is getting no where. I heard on the radio the other day that Fairway was hosting a "open house" to discuss with first time home buyers and people looking to purchase homes how to get mortgages. All I could think of is there will be more victims. No one may be able to help us but some one needs to stop mortgage companies from lying to potential home buyers and stealing their hard earned money. Concealing information until you are at the table ready to sign the papers all excited about getting in to your new home is not right nor is charging ridiculous amounts of money to insure a mortgage. In fact when we have asked if the PMI money that MGIC had taken from us would be used to offset any loss to the mortgage company if we did indeed go into foreclosure we were told "not really we will sue you for that amount". Nice:( Some one also needs to reveal the scam that the "Obama program" represents which is a worse solution to an already awful situation. While you are allowed to pay less on your mortgage your credit is being trashed and you are going into default. Thank you for hearing our story. I hope we will be able to find a solution to our problem so we do not have to leave our home. We also hope that others do not become victims of immoral lenders and ineffective Federal programs.
New York, New York
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