Pay to Pay

Have you heard the term yet? It’s a new term going around the Internet called Pay to Pay. It’s a way for credit cards, municipalities and other places to collect a fee if you choose to pay in ways other than mailing your check to them.

For instance, perhaps you want to pay a bill (your mortgage or your phone bill) by phone, authorizing the payment from your bank account or by using a credit card. Some companies are now seeing that as an opportunity for an extra charge. The irony is that many of those systems are automated. So you’re now phoning the place where you owe the money, pushing buttons, paying them, and for that convenience you get to pay a bit more. Maybe it makes sense if you’ve put off paying that bill and it is overdue, but to pay on time and still be charged an extra fee is hard to understand.

Charges and what I call ‘junk fees’ are common in the mortgage industry. During the first refinance boom in 2003-2004, when you called a lender for a payoff request (the exact balance of the mortgage you’re going to be refinancing at the day of closing) you could only fax that request. There was a ‘fax fee’ of approximately $10 or $15 that was added to the balance. But nowadays you should start taking a hard look at some of the fees that are added. We did a refinance the other day with Bank of America and discovered that there was over $135 in miscellaneous fees attached to paying off the mortgage.  

Although I cannot guarantee that you will get that money back, I most certainly would call my lender after the loan has closed and tell them that this is unacceptable and that you question whether or not they can charge you that much money to pay off the loan. (It is possible that the fees in question were actually included in the terms and conditions of your loan.)

So what I’m learning is that we have to pay attention and look at every bill carefully. It does not matter how much money you make; you have to keep your eye on them and make sure that you are not being over-charged.

Thanks for reading. 

Geoffrey Davis

214-975-1266- fax

214-529-9622- cell

Honored as one of the 2010 Best Mortgage Brokers in Dallas! for D Magazine.  Ranked 25th in 2009 production in the category Largest North Texas Residential Mortgage Lenders, according to the Dallas Business Journal!

Geoffrey is the “Frisco Mortgage Guy”!

P.S. I use DropBox as a more secure way to move papers back and forth – FREE!  If you sign up from this link – we BOTH get an extra amount of storage space, still FREE!!!

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