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According to a recent class action lawsuit filed by several plaintiffs against Carrington Mortgage Services, the company may have illegally charged processing fees to customers who paid their monthly mortgage online or over the phone.
Carrington Lawsuit Filed Over Mortgage Payment Processing Fees
Carrington Mortgage Services is one of the largest servicers of residential mortgages in the United States. However, according to plaintiffs in a recent lawsuit, the mortgage company may be violating the Fair Debt Collection Practices Act (FDCPA), as well as state debt collection laws, and the terms of their own mortgages.
According to consumers, Carrington may be charging borrowers $5.00 each time they pay their mortgage online, and between $10.00 and $20.00 for each payment made over the phone. These mortgage payment processing fees may also be referred to as “Pay-to-Pay” fees.
Plaintiffs Amy T., Brenda B., Miguel P., and William G. filed their lawsuit against Carrington Mortgage Services on Dec. 16, 2019. Plaintiff Amy T. claims that she made several online mortgage payments in September and October 2017, as well as February 2019. Each time that she paid her mortgage online, Amy claims she was assessed a $5.00 fee. William G. claims that in addition to the $5.00 fees he was assessed for payments he made online, he was also charged $10.00 and $20.00 fees for payments he made over the phone. Brenda B. and Miguel P. have similar claims regarding illegal pay-to-pay fees.
Unlike hidden fees, these fees are known, but not legal. Although Carrington is permitted by law to pass on fees paid to third party servicers to borrowers, mortgage companies are not permitted to mark-up these fees in order to pocket a profit. Although the system that Carrington uses to process online fees charges about $0.50 for each transaction, Carrington charges consumers $5.00 in order to pay their mortgage online. The $4.50 difference is allegedly pocketed by the company as profit.
Several other financial institutions have been found to have charged consumers illegal mortgage payment processing fees, including Citibank and Green Tree Servicing. Payment processors at these companies may be pressuring customers into agreeing to pay these deceptive fees by calling them “processing charges,” or saying that the fee was necessary in order for the payment to be processed immediately.
About the Fair Debt Collection Practices Act
The Fair Debt Collection Practices Act governs the ways that debt collectors are allowed to attempt to collect a debt on behalf of another entity. Under the FDCPA terms, debt collectors are prohibited from using false, deceptive, or misleading means in order to collect a debt. This may include misrepresenting the character, amount, or legal status of the debt.
If Carrington is misrepresenting the fees associated with online and over the phone payments, the mortgage company may have violated the FDCPA. Companies who violate the FDCPA may be sued within one year of the violation and may be subject to fines or legal action.
Consumers who believe they have been harmed by FDCPA violations committed by Carrington or another mortgage lender may be able to file a class action lawsuit against the offending company.
The Carrington Illegal Mortgage Fees lawsuit is Case No: 1:19-cv-03567-DLB, filed in the United States District Court for the District of Maryland, Northern Division.
Join a Free Mortgage Payment Fee Class Action Lawsuit Investigation
If you were charged a payment fee for paying your mortgage online or over the phone, you may qualify to join a FREE online payment mortgage fee class action lawsuit investigation.
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for informational purposes only.
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33 thoughts onLawsuit Alleges Mortgage Payment Processing Fees are Illegal
How do we join this class action lawsuit? Carrington just purchased my mortgage from Chase and now I’m expected to pay a $5 “convenience fee” to pay my mortgage every month? I contacted them to ask about it and they said that since they aren’t a big commercial bank, they have to pass on the cost of the service to us. It can’t cost them $5/transaction.
Chase sold OUR mortgage to Carrington, without our knowledge. They didn’t notify us of the change until we were 6mos behind. They didn’t tell us, my bank account had more money in it, then it should’ve. That’s when I called Chase to ask why my mortgage payments weren’t being taken out! That’s when I learned Carrington bought our loan. If not for that we would’ve been foreclosed. Also btw they took out our mortgage payment last Friday,right in the middle of the Covid 19 PANDEMIC. If you’re hoping they will work with us during this crisis I’m letting everyone know. Don’t hold your breath. Also we had to pay for a home inspection after they bought our loan. Talk about some sneaky ass bullshit!
Please add me. I have been charged all kinds of fees including the $5.00 for making my payment online to the $20 for the drive-by to my house to see if it is still occupied when you don’t make your payment at the beginning of the month.
How do I join? I have been with Carrington 3 years since I bought my house I always pay online and I’m always charged $5.00. In fact there has never been a payment that has not included that fee! I didn’t think anything Of it until now.
This company is total sleaze. My daughter’s mortgage was sold by Chase to Carrington, and Carrington did everything it could to set things up so they would end up in default: refusing to accept partial payment—if they owed two months’ worth of payments, Carrington would not accept anything less than the full amount due; driving by the house to be sure it was well maintained and charging for the drive-by; out of nowhere, increasing their monthly payment by $400, claiming that there wasn’t enough in “escrow” to cover property taxes. It turns out Carrington was paying itself higher interest and shorting my daughter on her equity. It was a nightmare, and unfortuntely, there is nowhere to go for help.
I had Chase and they transferred me to Carrington mortgage this month. They charged me a $5 convenience fee to make my monthly mortgage payment. I thought this was odd.
I have the same company and I noticed an increase in my mortgage payment I didn’t know what was going on but apparently this is what it is that charging a fee make the payment I actually tried to make a payment today and I can’t make the payment the website is down and it’s saying the company is permit they close when I search the website
I pay hundreds in fees, Including a $15 one time payment fee every month. But I have to say, the convenience fee take the cake. I paid over $300 last year in fees to flagstar bank since they took over my mortgage.
They charge me 5.00 dollars every time I make an online payment.
Irma January 13, 2020
My mortgage servicer was just switched to a new provider, PHH Mortgage. A bad Mortgage Servicer, I will be charge a “convenience fees of $7.50” for paying my mortgage online. Now, I’m also told they will charge me $17.50 if I make a phone payment. This is a way of defrauding their customers, they want to make it difficult to the customer, so customer will default on their properties and the lender acquires the customers properties. PHH Mortgage Services is known for this type of practice. They charge their customers who paid their monthly mortgages online or over the phone they are charging huge amount of fees.
These mortgage payment processing fees are referred to as Western Union
Speedpay is another way of deceiving their customers, and padding the monthly mortgage payment.
Charging their customers for making their mortgage payments should be against the law, and should consider as illegal practice, specially when the customers have not authorize the servicer or lender to charge their accounts for processing their
payments. Mortgage companies are not permitted to mark-up these fees in order to make a profit. Something needs to be done in order to put a stop to illegal fees.
Please add me
My bank charges 3.50 for a bi-weekly payment per draw, I was also paying an additional 67.50 per draw to equal a additional payment that was to be applied to principal. They were holding additional payment in a suspense account not applying to my principal as I requested.