In February of 2001, I sent in payments for two mortgages in one envelope to First Union. A few weeks later they started to call about one of the payments not being made. Since one was credited, they must have received the other. Constant calls led to nothing and they started calling me several times per day.

Not long after that, they raised my house payment by $200 per month and started adding in other charges. Many other calls wound up fruitless. In June, 2002, they foreclosed on my house to collect $2,800 that they said I owed them. I protested and asked (again) for a full accounting of the account.

The statement was extremely hard to read but I noticed some extra charges when I looked beyond February of 2001. It was only then that I found out that they had purchased an insurance policy on my house that I never knew I had. I was in the process of remortgaging and then found out they had been trashing my credit rating for a long time.

Adter a long time trying to figure it out I discovered what happened. My insurance payment was late to State Farm and they send me a cancellation notice followed by a reinstatement notice a few days later. To First Union, they sent a cancellation notice but intentionally did not send a reinstatement notice.

First Union (now HomEq) purchased a bare-bones polict and charged me $1186. Equivalent coverage would only cost $250 from an insyrance agent. They started an escrow account and took money out of my house payments and paid the insurance premiums. They never informed me of the escrow account (a misdemeanor under Michigan law) and never said that they were diverting payments.

Here is the scam. I found out that insurance companies no longer send reinstatement notices to mortgage comapnies. They do this because they know that the mortgage companies will buy another policy. Most states are probably like Michigan in that you can't insure for more than the value of the house. Once you have a second policy, with or without your knowledge, both insurance companies now are only providing half the coverage for the full premium as they must split any claim. First Union is pocketing over $1,000 per year out of a mortgage holders pocket for which there is no value.

This would happen even if you have the mortgage company pay your homeowners insurance. They simply send it in a few days late, wait for the cancellation notice and then buy the second policy. They claim that they don't know about any reinstatement of insurance but that begs the question: If there is a claim, does the insurance company call the mortgage company to ask about a second policy? If so, they the mortgage company has knowledge of insurance coverage and can not legally collect on the second policy. If they routinely split the cost of claims, does that not tell them that just about all of their policies have an original policy as well.

Recently, I was cleaning out junk mail and have been in the habit of shredding the address label. I came accross a letter from the Money Store postmarked two years ago. This caught my attention because I have since learned that First Union bought the Money Store (and promptly took a $2 billion writeoff againt income). It contained an insurance policy from the Fidelity and Deposit Company of Maryland. Then it became clear that they did send the policy but tried to coverup the letter by disguising it as junk mail.

I have figured out that many people who use an escrow to use their account have had their paymants raised like mine but never checked to see that they were paying beyond their property taxes. Anyone who sold their house or remortgaged, had the old loan paid off including these charges that they never knew they had. This could amount to hundreds of millions of dollars in free money to both mortgage and insurance companies.

I have sued them and will certainly take copies of all complaints on the ripoff wes site to court. I also urge anyone who may be a victim of the scam to contact me.

An attorney I talked to said the First Union can get away with this scam because they are big and no one can fight them. I say NOT and will fight them with everything I have got. I am talking to a state legislators office tomorrow 2/24. This has been long and thanks for your patience. They are trying to take away my house of 24 years to promote a scam. I will fight to my last breath to get justice from these %$#@#$%&&%$#.

Eugene .

East lansing, Michigan
U.S.A.

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Excuse the typos:

Sorry, my eyes are not very good and long letters are tiring. I am very literate and can't edit out the typos and lost thoughts. Your understanding is appreciated.