Mortgage Lender Admitted to Losing our Payment

[mortgagemess]

What is the name of your state? Indiana

What is the name of your state? Indiana

I had previously attempted to get some advice on the situation below. Does anyone have any advice?

At the end of 2003, we got behind on our payments. We tried to contact our morgage company numerous times to see if we could get help as they state if you get behind on payments, they have options for help.

After several attempts, there was no response. Finally, in early 2004, we sent a payment as our finances were better. They returned the check stating that they could not accept it as we had not contacted them about a payment plan.

Once again, we tried to contact them. No response. Finally after contacting hud as this is an FHA loan the lender responded. This was now March 2004. They had already started the foreclosure proceedings. However, they stated if we paid 3 payments plus a ridiculous amount for their attorney fees, they would refinance, etc, to get our loan back on track. We followed through with the three payments as they requested. At that point, they stated do not send anymore money until they reviewed our account. We spoke to thier attorney and was informed the foreclosure had stopped because we followed through with our payment.

We waited and waited for the review, and it never happened. Upon reviewing our account online, we saw that the first payment we made(the largest of the three as it included attorney fees) had not been applied.

Finally after months of waiting, they contacted us stating that they lost our first check and we needed to get a new one reissued. We spoke to our bank and they stated that a cashiers check could not be cancelled automatically. We would need to contact the lender and have them sign a form that if the check was found, they would not try and deposit.

Well, that was July of 2004. We are now 14 months behind on our mortgage, and they keep tacking on late fees and reporting us as late on our credit report. It takes them at least a month or more to respond, and we have recieved zero correspondence in the mail from them for at least one year. We have only spoke to a load specialist(the same man) who stated to not send any money until the review was done.

We realize we are in the wrong for getting behind, but this is ridiculous! How in the world does a large financial instituation lose a large cashiers check. We have no idea what to do. We have involved HUD, but they do not seem to know what to do either.

We have all the documentation regarding admitting losing the cashiers check, agreement to work with us to get caught up, etc. Does it sound like our mortgage company is doing something illegal? Do they not have to follow HUD guidelines when servicing an FHA mortgage?