Comments on: When Customer Service Goes Awry

By: CW

CW — Mon, 04 Apr 2011 16:39:27 +0000

Excellent way or handling this… thanks for sharing.

By: Donna

Donna — Thu, 11 Nov 2010 00:05:55 +0000

I disagree that it was primarily the bank’s fault. The insurance company should have contacted the homeowner directly prior to canceling the insurance for non-payment, especially since the payment was late coming from an escrow account.

By: Dave

Dave — Wed, 10 Nov 2010 20:25:58 +0000

I had this happen to me too, my mortgage company was paying the insurance and didn’t then sent me a nasty letter saying if I didn’t get new insurance they would consitter that grounds to foreclose, or I could use their insurance at 5X what I was paying, new mortgage company and new insurance that I pay. With the first company, when I get the mortgage I was told I had to use an escrow, the second one asked if I wanted one.

By: Mule Skinner

Mule Skinner — Wed, 10 Nov 2010 14:41:33 +0000

I had a similar situation earlier this year. Instead of giving me a paper prescription, my clinic insisted on sending it to the pharmacy electronically.

Pharmacy said they didn’t get it; clinic said they sent it. Repeat. Both of them were talking to me and not to each other.

Finally got the pharmacist to phone the clinic, which said “Oh? Why, we’ll just send it again.”

(Pardon my “French”: %&#*@!)

By: Sam

Sam — Tue, 09 Nov 2010 21:21:30 +0000

One of the best things I did when I got my house was I was adamant about no escrow.
It’s been great – makes shopping around for insurance easier since it’s easier to switch… and I’m responsible for the payment not some bank computer.

By: Paula Kastelec

Paula Kastelec — Tue, 09 Nov 2010 19:19:09 +0000

Im a frugal person and wont pay someone to do something I can do myself.
I pay my own property tax and homeowners insurance myself.I estimate the yearly total for both plus a little extra.Each month I put this money in a safe place at home .I also do this for my dogs meds.,check ups etc.
I save stamps by paying them , when due, locally.
I budget everything, even an emergency fund for unexpected surprises.
My husband and I have made a game of this over the years and we constantly think of new ways to save money on things….

By: lmoot

lmoot — Tue, 09 Nov 2010 18:57:37 +0000

I just went an called my mortgager to begin the escrow terminating process. I’m over 20% equity and no late payments, which were the only requirements. I just have to wait until the taxes are paid this November and I’m FREE! Which is perfect timing as I just opened and ING orange savings account so I can start a sub-account for taxes and insurance and start earning interest immediately.

By: Sue

Sue — Tue, 09 Nov 2010 18:13:29 +0000

Trent, excellent post. Actually, I’ve heard this happen before too. Seems escrow accounts are becoming outdated w/new banking trends–downsizing of personnel at banks, as well as poss lack of detailed security training of those overseeing these many ‘automated’ tasks that are set-up to handle these accounts. Made me think in the IT/Cisco world–they would probably interpret the ‘missing link’ as a form of ‘route poisoning’ (LOL)As mentioned above,in ANY industry, due diligence will always remain extremely important.

By: Goody

Goody — Tue, 09 Nov 2010 17:35:51 +0000

Thanks for the alert. The last few years I’ve been checking to make sure my property taxes are paid but I never bothered with my homeowner’s insurance. Now, I’ve marked in my electronic calendar to make sure it’s paid when it comes due next year. Like someone else said, you can bet your a$$ I would have screamed bloody murder if that had happened to me, and heads would roll, I assure you. That’s what the Attorney General, the ABA (and as a last resort the BBB) are there for: to protect the consumer from incompetence and what should be a completely professional field. Due diligence also applies to credit unions and insurance companies!

By: AnnJo

AnnJo — Tue, 09 Nov 2010 16:24:05 +0000

Wherever possible, I have recurring payments set up for auto-pay from a credit card, and then auto-pay the credit card bill monthly from my bank account. This gives me an extra month to catch possible errors before my money is committed, fewer creditors with direct access to my bank account, and tons of frequent flyer miles. The bank account is linked to a line of credit for overdraft protection, just in case there’s an error in processing a bank deposit. This all minimizes the chances that a mistake by me or someone else will cost me money.

All that being said though, I’m grateful for the fact that mistakes by banks and creditors are, in fact, few and far between considering the volume of transactions handled. Yes, they are annoying when they happen, but keeping things in perspective means that minor annoyances shouldn’t ruin anyone’s day.

By: Stephanie

Stephanie — Tue, 09 Nov 2010 16:17:32 +0000

Can you decline having an escrow account and pay the bill directly yourself? My bank didn’t give me a choice in the matter…

By: Michele

Michele — Tue, 09 Nov 2010 16:05:06 +0000

I’ve always paid my Homeowner’s Insurance monthly, either a check by mail or more recently, online…the only time I have had a problem is when the stupid mortgage is sold and I have to go through the rigamarole of having my insurance agent fax a copy of our policy and stating we’ve had insurance continually throughout the mortgage.
I’ve never had an escrow account so maybe that’s why I haven’t had this painful situation. Oh and having an Insurance Agent who has an office close by and plays hockey with my husband doesn’t hurt, either. Our rates are very low, we are with a national company with top-notch service (State Farm)and the rates are even better than USAA, Geico, Progressive and Allstate for our situation. (Home, Life, 3 vehicles, boat and student renter in college)

By: Rachael

Rachael — Tue, 09 Nov 2010 15:13:36 +0000

This has happened to me several times. The best is when the bank pays the insurance then sends me a letter that the home equity loan with the same bank is not insured and I have x amount of days to find homeowners insurance. Both times it took several phone calls to make the bank understand that the house with the escrow is the same house as the equity loan. As soon as possible I dropped the escrow and haven’t had a problem since.

By: Randy

Randy — Tue, 09 Nov 2010 13:20:58 +0000

Thanks for the article and thanks for your attitude. I see a lot of commenters who wanted you to get upset, but I hope I would follow the same path you did. Getting upset and yelling doesn’t solve the problem, getting rid of escrow did (in this case). Now it’s your responsibility.

I encourage escrow for most people as they frequently come up surprised at Christmas, how much worse would it be for insurance or taxes. Not everyone can have the self control it takes.

One request for future blogs – similar to this one – how would you handle other mistakes? A company that overbills? A statement of debt owed that is incorrect? (I’ve had both of these). Just getting mad and walking away from the company or threatening lawsuit doesn’t really solve the problem and probably elevates your blood pressure (increasing medical bills).

Thanks

By: David/moneycrashers

David/moneycrashers — Tue, 09 Nov 2010 11:59:08 +0000

And, I might add, don’t give up, don’t ever give up.

Fight and fight and fight until you’re satisfied that you’ve been penalized not at all for all of these mistakes which weren’t your fault.

By: RLS

RLS — Tue, 09 Nov 2010 11:52:56 +0000

The only automated payment I currently have is my car payment, and that’s because I had no choice in the matter. I don’t like automated payments, primarily because I don’t like allowing direct access to my chequing account. I want to control who, and how much, I pay. Now, to be fair, I’m organized and never miss payments — I know other people like the freedom of not worrying about it. YMMV.

I don’t know of any Canadian banks that will handle your house insurance. Many people I know do handle their property taxes through the bank, and a similar situation happened to both my partner and my father at one time or another. The bank didn’t receive the proper documentation from the province and therefore didn’t pay any property taxes. Not as serious as allowing home insurance to lapse, certainly, but frustrating. When I buy a house (very, very soon!), I plan to handle it all myself. Good reminder, Trent!

By: sandycheeks

sandycheeks — Tue, 09 Nov 2010 11:45:37 +0000

Due diligence as a property owner means making sure that your taxes and insurance are paid.

Escrow acounts are marketed as a convenience to the “homeowner” but are really designed to protect the bank.

By: marta

marta — Tue, 09 Nov 2010 09:54:15 +0000

Sorry, I meant “homemade laundry *detergent*”.

By: marta

marta — Tue, 09 Nov 2010 09:13:50 +0000

Back to the topic: I don’t get the point of an escrow account. It seems to be a convoluted system.

My insurance company is affiliated with my bank, and whenever it’s time to renew, I get a couple of notices in my mail beforehand and then an automatic debit from my regular account (same where my mortgage payments are debited). No muss, no fuss.

Of course, as with any other automatic debit, I always check my statements to see if the money was actually taken out from my account. *All* my payments are automated, but as I’ve said before, it doesn’t mean I’ll ignore bills or bank statements.

By: marta

marta — Tue, 09 Nov 2010 09:03:19 +0000

Steven, but what if that’s how he really feels? Trent may think that *any* food he makes in his kitchen is “sublime” or “mind-blowing”, or that any annoying situation such as the one described above is “disturbing” or that a regular inconvenience is “disastrous”. And he may very well be “passionate” about anything from honing a knife to making homemade laundry.

Not that I agree with these descriptions at all, but some people are just big drama queens.

The main issue I see with the over-use of hyperboles is that words lose their impact at some point.