Is Arvest Central Mortgage Charging Illegal Pay to Pay Fees?

Consumer advocates are concerned that Arvest Central Mortgage may be charging borrowers extra fees to pay mortgages over the phone, without making homeowners aware.

Do You Get Charged Additional Fees to Make an Arvest Central Mortgage Online Payment?

Consumers often do their banking online or over the phone to get their business done quickly and efficiently. Though banks tout the convenience of these services, they may come with hidden fees. If you are an Arvest customer and you pay your mortgage by phone, you may be hit with unexpected charges. 

Arvest Bank announced in early 2020 that it originated $2.8 billion in mortgage loans in 2019, a record number. The figure marked a 39 percent increase from the year before. This means that countless borrowers with Arvest Central Mortgage loans may have been charged unexpected pay-to-pay fees.

Some customers say Arvest is charging customers $10 to pay their mortgage over the phone with a customer service representative, and $5 to pay online or over the phone with an automated system.

Arvest may be among many banks that are charging customers to pay their mortgage by phone. Customers have filed lawsuits over the practice, saying it violates state finance codes. 

According to Arvest Bank’s website, these allegations may have substance. Arvest’s fee schedule shows that there are several fees that consumers may be charged when making a mortgage payment. To pay by phone, Arvest Bank customers reportedly have to pay up to $10 depending on the state. Similarly, to pay online, Arvest says that consumers may be charged up to $5 – as alleged by consumers.

Other Arvest Central Mortgage fees reportedly include $25 returned payment processing fees, up to $500 in collateral adjustment processing fees, and more.

Although some companies may legally be able to charge borrowers a servicing fee to cover the costs of processing a payment made online or over the phone, there are generally limits on how much can be charged.

Usually, companies are only allowed to pass on these costs of doing business to the consumer, rather than using the terms “servicing fee” or “processing fee” in order to turn a profit. It often costs only cents for companies to process these payments, however, many consumers have reported being charged between $5 and $15 for making a mortgage payment.

What Are Pay to Pay Fees?

Some companies may charge consumers an extra fee to pay their mortgage payment by phone. These fees can have a number of different names — processing fee, convenience fee, or others. These various names can conceal the purpose behind the fees, making them confusing for consumers. The fees typically range between $5 and $15.

CreditCards.com explains that the federal government largely considers these fees to be unnecessary, and is warning customers to be aware of them and banks to avoid abusing them.

Are Pay to Pay Fees Legal?

Consumer Financial Protection Bureau Director Richard Cordray released a statement saying that banks may be intentionally misleading customers about the costs of paying over the phone, or financial institutions may be shepherding customers toward expensive payment options while hiding lower payment options, says Credit Cards.com.

CreditCards.com goes on to say that Edgar Dworksy, founder of consumerworld.com and a former Massachusetts assistant attorney general in consumer protection, explains that banks pressuring customers into paying by phone usually occurs when a company is attempting to collect a mortgage debt.

Banks may try to capitalize on the stress and worry that a consumer may experience if they are late on their mortgage payment. These banks might say that the customer’s only option is to immediately pay by phone, or threaten foreclosure if they do not pay right away. 

Dworsky advises consumers to always ask what fees are associated with a payment option being offered and, if there are fees, to ask if there are other payment options that do not charge a fee. 

A spokesman for Consumer Action, Joseph Ridout, summarizes, saying “it may well be worth it to pay an expedited fee to pay by phone or other mechanism. But consumers should never be hoodwinked about the purpose of the extra fee.”

Consumers who have been pressured into paying additional fees for services they may not need, such as expedited posting of the payment, may be able to avoid incurring future fees by asking representatives about low or no-cost options for making payments. Although bank representatives may attempt to sway consumers toward paid options, they should not lie about lower-cost alternatives.

If a bank misleads consumers about what options are available or threatens them into making a payment, it may be a violation of the Fair Debt Collection Practices Act, other federal law, or state finance codes. In some cases, consumers have made legal claims that a mortgage lender is in violation of their own contract by charging these fees.

Additionally, some consumers claim they were not informed about these fees and did not realize they would be assessed additional charges for paying their mortgage online or over the phone. These fees are supposed to be properly disclosed to consumers by their lenders.

The Consumer Financial Protection Bureau and also mortgage customers have taken action to challenge allegedly misleading and unfair fee structures.

In 2015, the Consumer Financial Protection Bureau and the Federal Trade Commission (FTC) issued a complaint against Green Tree Servicing LLC, saying that the mortgage company made a practice of pressuring customers into paying immediately over the phone and incurring a fee to do so. 

According to the government’s complaint, in some cases, the bank would go so far as to tell homeowners that they would face immediate foreclosure if they did immediately not pay by phone and incur a fee along the way. The government also claimed that the bank falsely told consumers that their only option was to use a service that came with a $12 fee.

Unfortunately, pay-to-pay fees may not be the only cost customers encounter. Investopedia notes that mortgage lenders may try to sneak a range of fees into an agreement.

What Lawsuits Have Been Filed for Arvest Central Mortgage Pay to Pay Fees?

In March 2020, Arvest Central was named as a defendant in a class action lawsuit filed by a customer who claims the lender charged customers $10 to make mortgage payments by phone with the help of a customer service representative, and $5 to pay online or by phone with an automated system.

According to Robert L., who filed the Arvest Central Mortgage class action, the mortgage lender should have covered the costs of various payment methods with the cost of the interest paid on a borrower’s monthly payment. 

Robert argues that Arvest violated Texas law by charging fees that do not reflect the cost incurred by the bank to provide the payment method services. Texas law, the suit states, prohibits the business from marking up the amounts it pays to third parties to provide payment method services in order to itself profit off of these payment methods itself. 

Robert claims that Texas law also prohibits banks from charging fees that are not expressly laid out in the mortgage contract. He seeks damages on behalf of himself and other customers who were misled or financially injured by Arvest’s practice of charging fees to make a mortgage payment over the phone.

Should You File a Pay to Pay Fee Lawsuit?

The Federal Trade Commission (FTC) encourages consumers to carefully review their monthly billing statements to look for any fees. Some of these fees may be legitimate, but the FTC notes that reviewing statements can help consumers find unfair or suspicious fees. If consumers are unsure about a fee they were charged, the FTC says that they can ask their mortgage servicer for an itemization and explanation through a written inquiry. 

Under federal law, mortgage servicers are legally required to respond to qualified written requests within 20 business days of receiving the inquiry. Within 60 days of receiving the inquiry, the service provider must correct the fee or find that it is accurate.

The regulator also notes that consumers can avoid unexpected fees by asking about these charges up front. For example, if consumers ask their mortgage servicers to pay over the phone, fax documents, or provide other services, asking about fees can prevent any misunderstandings or unexpected charges.

However, consumers who feel that they are being unlawfully charged mortgage fees may be able to take legal action.

If you are an Arvest Central Mortgage borrower and paid your mortgage over the phone, you may have been charged a fee. Some customers may not have been aware they would be charged a fee for paying by phone. 

If you found yourself in this situation, you may have a legal claim. An experienced lawyer can help you determine if you have a legal claim and help you build the strongest case possible to get compensated for fees you incurred. This may involve collecting documentation of the fees you paid, the contracts you entered into with your mortgage lender and information about what laws may have been violated. 

The Arvest Central Mortgage Pay By Phone Fee Class Action Lawsuit is Robert Lange v. Arvest Central Mortgage Co., Case No. 4:20-cv-00293-LPR, in the U.S. District Court for the Eastern District of Arkansas. 

Join a Free Mortgage Payment Fee Class Action Lawsuit Investigation

If you were charged a convenience fee for paying your mortgage online or over the phone, you may qualify to join this mortgage payment fee class action lawsuit investigation.

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This article is not legal advice. It is presented
for informational purposes only.