QUESTION
My mortgage was sold to another lender, can they change the terms of the contract?
Asked on Oct 17th, 2016 on Breach of Contract - Ohio
More details to this question:
My original mortgage contract or note states that I may make advanced payments without penalty. There is no limit to how far in advance I may pay. A new lender bought my note and are now insisting that their policy provides that I may pay no more than six months in advance (but I may still make additional payments towards principle). They admit there is no such six month limitation in the contract, but insist it is their policy. I believe my contract overrides their policy. They insist not. I believe if they did not wish to abide by the contract they should not have purchased my loan. Are they in breach of contract, and if so, what can I do about it? I am tired of fighting them and would like to prove I am right. This company has literally (yes literally) thousands of complaints against the with the Consumer Financial Protection Agency and the Better Business Bureau. I don't know how they are still in business.
1 ANSWER
Your dealings with the new lender are governed by the contract they assumed, not their policy, to which you never agreed to be bound. If the lender wll not allow you to exercisse your contractual rights, you can sue it for a declaratory judgment that it must allow you to prepay as far in advance as you wish, and for any monetary damages you may have sustained due to the lender's brech. The practical problem is thet the expense of such a suit will mean little to the lender, and may be prohibiitive to you. You should take a careful look at your loan agreement to see if it has any provision about the prevailing party being able to collect attorneys fees from the loser if there is any litigation over the loan. Also, check that there is no provision requiring arbitration of any disputes.
Answered on Oct 18th, 2016 at 2:54 PM