Call Kurtis: Why Am I Being Charged Home Inspection Fee When No One Inspected my House?
FAIRFIELD (CBS13) - Chris Ryan has owned his house for a quarter-century. After his home loan was taken over by a new company, he says an odd charge popped up on his statement.
The new company, BSI Financial, charged Ryan a $35 fee on his mortgage statement for inspecting the interior of his house, but he says no one knocked on his door.
"Somebody should be asking us to come in the house and look around," said Ryan. "Certainly no one came in the house," he said.
He says BSI could not explain the strange charge to him.
"They just charged me $35 for nothing," said Ryan.
When he called BSI, they agreed to drop the charge. On his next three statements, the home inspection fee line was gone, but under total fees and charges it showed, he still owed $34.72 with no further explanation. We have since found out he rounded up a mortgage payment, and they deducted the extra 28 cents he paid from the fee.
"Let's move it around, maybe they won't catch it," he said.
Gary Almond with the Better Business Bureau says, "Certainly the borrower would know if someone had been in their house or not. If they weren't there, why would you want to pay it?"
Almond says banks sell home loans or hire other companies to service the loans all the time. And when someone buys or takes over servicing your loan you do not have much of a choice.
"The only thing you can do is refinance," said Almond.
We reached out to BSI Financial, and here's how they responded, in part:
"We do not charge borrowers' property inspection fees and the charge to Mr. Ryan's account was a mistake that has been corrected...unfortunately, it was not resolved until you inquired about this."
"These stupid little fees are an insult," Ryan said. "I think they're trying to take advantage of the little guy."
Experts tell us some mortgage companies do inspect the inside and outside of homes; however, that information and related cost must be outlined in your original loan agreement.
Here is the full statement from BSI Financial:
"It is BSI policy NOT to charge borrowers for this fee although it is standard in the industry to charge borrowers for a property inspection, under certain circumstances and with respect to loans secured by properties in many states, when the loan is delinquent and contact has not been made with the borrower. A property inspection is used to determine the condition of the property and whether the property is still occupied. But, although typically legally permissible to charge borrowers, BSI charges its loan investors for this fee because there are legal nuances regarding when the fee can be charged and under what circumstances and the law varies by state. It is simpler and advantageous to the borrower not to charge the fee to the borrower.
In this instance, the fee was charged due to a processing error. The fee should have been assessed to the account as a "non-recoverable expense" (this code means that the fee is not recoverable from the borrower and our servicing system would then not pull the amount and add it to the monthly statement), but due to human error it was not processed that way. This has since been corrected. When the borrower, Christopher Ryan, inquired about this fee and requested us to remove it from the account, it should have taken place immediately. This would have required a manual task to delete the fee from the account. Unfortunately, it was not resolved until you inquired about this... This is an isolated incident, the employee has been counseled, and we do not expect these to be coded incorrectly again."
