Excessive penalties and interest on mortgage

[WVBrady]

I am inquiring on behalf of a friend of mine. He and his wife have a 15 year loan on their house. The monthly payment is $1140. His wife has been paying $500 on the 15th of the month and the rest was taken out of her husband's retirement at the end of the month (He retired from this bank). What she was not aware of was that the payments were supposed to be made in two equal halves per month, so she was underpaying the first payment. Suddenly they got a registered letter stating that they had been delinquent in their payments for some extended time period (I don't know the exact number) and that unless they paid over $6000 dollars in penalties and interest, the bank was going to foreclose on their house. They had one month to do this. Fortunately, I heard of their plight and was able to loan them a few hundred dollars that, along with their savings, they were able to pay the amount demanded.

They contacted a local attorney and she said that the one month's notice was consistent with the bank's regulations, but admitted that she was new to this kind of problem.

It seems to me that it should not be permitted for a bank to let penalties and interest to pile up like this without any notice. I urged them to try to find an attorney that specializes in this sort of situation.

I have three questions:
Do you think that they have any chance of getting their money back?
Where could I find any applicable regulations or statutes?
How could we locate an attorney who could help us?

This is in the state of WVa
TIA, Brady

 

[seniorjudge]

Q: Do you think that they have any chance of getting their money back?

A: No; it has been applied to their loan.


Q: Where could I find any applicable regulations or statutes?

A: A law library or the internet. But the provisions of the loan govern.


Q: How could we locate an attorney who could help us?

A: To do what?

 

[WVBrady]

Q: Do you think that they have any chance of getting their money back?

A: No; it has been applied to their loan.

Do I understand correctly? The penalties and interest have been applied to the principal of the loan?

If I was not clear in my description, the total amount that they paid each month was correct. It was just that the part of the payment that was made at the middle of the month was too small. BUT, the amount paid at the end of the month MADE UP FOR IT, so the TOTAL FOR THE MONTH WAS CORRECT.

The main thrust of my question was: Is it legal for them to let penalties and interest accumuate to a large amount WITHOUT ANY NOTICE that they are delinquent. (Please forgive my shouting; it is the only way I can show emphasis.)

TIA, Brady

 

[seniorjudge]

Q: Is it legal for them to let penalties and interest accumuate to a large amount WITHOUT ANY NOTICE that they are delinquent.?

A: Yes; you are required to know what you sign. (I don't know where the dough was credited to; ask the lender.)