CASE STUDY

Could this be you? One woman's frustrating battle with Chase Manhattan Mortgage Corporation

In 1998, Jane Robinson purchased a new home under a mortgage agreement with Chase Manhattan Mortgage Corporation in Edison, NJ. A year or so later Jane had to declare bankruptcy and filed a "petition for relief" (required under the Bankruptcy Code) with Chase, which accepted her claim.

Six months later, in July 2000, Jane was ready to begin making payments again. She requested that her employer deduct a bi-monthly sum of $1172/month - her total mortgage payment - from her paycheck, and turn it directly over to Chase. Unfortunately, however, due to a computer error her company failed to begin the payments until three months later (though the payments have been consistent ever since).

By December 31, 2000, Jane was able to catch up on all the mortgage money she owed by making payments on her own, in addition to those her employer was handling. In April 2001, however, Chase made a court order, claiming she had failed to make her payments. Upon investigating the discrepancy, Jane found out that Chase had been failing to cash one of the two monthly payments sent by her employer since December 2000. Not only did they not cash the two payments, but the payments were never returned to the employer and had simply "disappeared!"

Eventually Chase cashed both the payments, but put them in a "suspense" account and failed to credit her account, which never showed a reduced balance resulting from the payments. This is a blatant violation of Chase's agreement, which stated that Jane's account would be credited upon receipt of the second bimonthly payment made by her employer.

These actions are a fundamental violation of the mortgage agreement and have been repeated in the same way with numerous mortgagors. Chase also returned some valid checks issued by Jane's employer. One reason for doing so, they claimed, was that the employer hadn't included the loan number on the payment. In fact, the loan number was clearly printed on the payment in the same place it had always appeared on checks that Chase had previously accepted and cashed.

Jane tried repeatedly to contact Chase but was never able to successfully straighten out this frustrating issue on her own. As recently as January 2002, Chase even refused to provide her with an up-to-date payment history. The company occasionally had provided payment data and account information, but the records were inconsistent, difficult to decipher, and never accurately reflected her employer's payments and credits to her account.

Chase also presented Jane with a Mortgage Interest Statement for 2001 showing an incorrect interest amount paid by her or on her behalf, a negative escrow balance, and also an incorrect statement of prepayment amount. Chase continues to conceal its failure to properly credit payments by providing confusing, inconsistent and incomplete payment data to Jane and numerous other members of the suit.

Chase has instituted improper methods of handling partial payments (i.e. suspense accounts; not recording payments) and claims that partial payments are violations of the obligations of the mortgagor.

Chase Manhattan Mortgage is being charged with Four Counts of Claims for Relief.