Complaint Review: National City Mortgage

I have a conventional 30 year fixed price mortgage. The Loan to Value ratio was scheduled to reach 78% on January 1, 2009. With my January payment it actually dropped down to 77.9%. I am current with my payment and have never been late. However, my PMI did not automatically terminate.

I called and spoke to a customer service representative and she told me she would put a request through for me. She acknowledged the LTV was less than 78% now. I called back a few days later to check the status and was told that their insurance department had sent me out a letter saying since I have requested termination of my PMI I had to provide a new appraisal of my home to prove it that the value has upheld. I did not request the termination, I pointed out to them it should have auto terminated. I pointed out to the rep that I was under the 78% but she was unfamiliar with the regulations. She said all she new was what their insurance people are saying. I asked to speak to them and she said the insurance group will not take calls from customers. I asked for a manager and was told that one was not available for me to speak with. I was told there was nothing I could do about it and I had to get the house reappraised.

I called the manager of my loan officer's office and told him that they were required to drop my PMI automatically in accordance with the Homeowners Protection Act of 1998. I am at 77.9% and I am current as a matter of fact I have never missed a payment. I said to him your corporate rules do not supersede the law. He responded, "Yes, they do."

I filed a complaint with the US Treasury Deparment but I also felt obligated to post this message. Keep an eye on your LTV because this company will not automatically terminate your PMI. It is their policy to strong arm you into getting an appraisal of you house. According to the Homeowners Protection Act of 1998, lenders are required to automatically terminate PMI when you reach 78% LTV of the ORIGINAL property value. National City refuses to follow this law and furthermore refuses to discuss it with you.

Since they will not automatically terminate it, be careful and watch your PMI and make sure you are not getting charged for what you shouldn't be.

Tim
Jersey Shore, New Jersey
U.S.A.