Countrywide Says "Our Investors Require" Us To Rip You Off

Matt writes:

I hate Countrywide. What is my beef? I have several beefs.
1. When you call customer service, woe is thee who needs to be transferred. About 50% of the time, my call gets dropped.
2. When they aren’t busy dropping your call, they spend the rest of the time trying to pitch you into another Countrywide loan or product.
3. PMI [Ed. A type of insurance a borrower pays to the lender to protect the lender in case the borrower defaults. It is typically required when putting down less than 20%]. Because this was our first home loan, and it was considered a “jumbo” (I hate that term), they required us to have PMI (despite having put down 20%). During the summer of 2005, we were nearing the magic 80/20 Loan-to-Value ratio, which I believed to be sufficient to have them remove our PMI…

So I paid a whopping $300 to have an appraisal done. Based on the outcome of that appraisal, and our principal balance at the time, we were right at the 80% mark. When the appraiser was done, he asked what our balance was, and he said that we should be OK getting the PMI dropped. Not so fast. After Countrywide got the appraisal report, they told me that their investors (they use that term all the time) required LTV of 75% in order to drop PMI. So, after spending $300, I was not able to have the PMI Dropped. Never mind that that all my research on PMI said 80% was the standard ratio.

After that — I had become gun shy to spend any more money to get my PMI dropped, despite the fact that our LTV ratio would continue to drop south of 80% (even if our home’s valued remained the same).

Fast forward to January 2008, and I get a nice little form letter from Countrywide stating that our LTV is 80% or lower (sound familiar?), and that I can request to have my PMI removed. Hmmm. It was at 80% in 2005, they must have a really cool time machine or something. Oh wait, they told me in 2005 that they needed LTV to be at 75% because of their investor requirements. So which is it, Coutrywide???? 75% or 80%?

Not being one to look a gift horse in the mouth, I called them back and told them I was quite interested in having our PMI dropped. And yes, my called got dropped as it was transferred from the main call center to the PMI department. So, after finally getting to through to the mystical Wizard of PMI, I formally requested to remove PMI. Their rep looked up some quick figures, our spotless payment history, and said our LTV was looking good. “FINALLY!” I thought to myself.

Wrong again — I just got yet another letter indicating they want me to fork over $130 for a “COV” or Certificate of Value. If I use the two and a half year old figure of our home’s appraisal and divide it into our current principal value, I’m actually below 75%. I’ll go out on a limb and say an appraisal today will be somewhat more than it was in 2005 (despite the down market).

So yes, I have a beef or two or three with Countrywide. I know in the grand scheme, I’m talking chump change, but the contradicted themselves, and hide behind the “our investors require” line way too much.

Sounds about par for the course for Countrywide. Let’s find all the fees and insurances that exist for home mortgages, and then charge them to customers who they shouldn’t apply to. Result? More money! Oh, it’s legit and official though, because “our investors require” it. What do you say to that?

(Photo: Meghann Marco)