A while back, I got a letter from my mortgage lender (Chase). The letter indicated that my homeowner's insurance was about to lapse, and that if it did lapse, the lender would require me to buy a short-term policy to ensure that there was coverage in place until my policy was reinstated.
This caught me by surprise, seeing as how I pay a big chunk of change into escrow every month, from which my lender is supposed to pay my property taxes and insurance premiums. So, I called my lender and said, "Did you guys pay my premium? Because if you did, then my insurance won't lapse." They said, "We tried, but the payment was rejected." I said, "What? Why would the insurer reject a premium payment?" They said, "We don't know. If you want to call USAA and talk to them..." I said, "My insurance isn't with USAA. It's with Farmer's. That's why USAA rejected the payment--I don't have a policy with them." They said, "Huh... Was your insurance ever with USAA?" I said, "No." They said, "Okay, well, it says here that your policy is with USAA. So, let's get the right information in here, and we'll get the payment made." (Did it occur to anyone at Chase to call me when the payment was rejected and say, "Hey, can you help us figure this out?" Guess not--as you'll see below, lapsed coverage means easy money for them.)
Well, a bunch of phone calls later, I confirmed that the payment had been made, no lapse in coverage, etc.
Then, a month later, I find that a $6,300 debit has been attached to my mortgage account--basically, added to the amount that I owe on the house. The charge was for the short-term insurance policy Chase had threatened to issue and force me to buy in the event of a lapse in coverage.
Of course, there WAS no lapse in coverage (and the only reason there was a risk of coverage lapse in the first place is that Chase had attempted to make a premium payment to the wrong insurance company). Not wanting to let that stand in the way of a quick buck, Chase charged me $6,300.
Well, another whole round of phone calls later--literally, starting from scratch, from the very beginning of the whole saga--and I get this resolved. In the course of that round of phone calls, though, I talk to one particularly dull call center worker who tells me this: "We fixed this a while back. We issued a $6,300 refund to your insurance company. So, if you want that money put back in your escrow account, you'll need to get it from your insurer." In addition to making zero sense--the insurer wasn't out $6,300, I was--this turned out to be completely false.
I also asked dull call center guy to explain to me another seeming anomaly on my escrow statement. After two rambling, incoherent attempts on his part--answering questions that I didn't ask--I say, "I'm not sure you understood my question. Let me try again..." He pauses for a moment and then says, and I quote, "That information is not available at this time. Is there anything else I can help you with?"
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So, the main point of this little exercise was for me to vent. But the secondary point is to encourage YOU, my cherished readers, to stay on top of your mortgage lenders, your tax guy, your insurance agent, etc. These people can be far less competent than you might think, or hope, or want...and they're playing with your money. So please, just keep a close eye on them. Trust if it's warranted, but always verify.