Hi all, I have what I think is an issue around a mortgage. I originally purchased my house threw a bank that collapsed during the bubble bust. My mortgage went in limbo for a while until they put it in another bank. This bank claimed to be acting like a collection agency trying to recoup the loan money. I discussed my displeasure with them. I really didn’t want to put my family and everything in limbo so I continued to pay it. My question is can they legally charge interest or late payment fees acting as a collection agency? My loan was never delinquent except during my time out from work for my illness. Then it only fell behind a month and a half. They threatened to take it back then even. I also wonder how it was under a collection agency when the bank that went under broke our contract when it went bankrupt. So could another bank just be given a loan after the bank broke the contracted agreement? Anyway I will have it paid off completely on Friday and that was after arguing over extra money that was pumped in to cut the principal down. They tried to use it all as payments and extend the length of my loan. Like I first stated I never liked doing business with the bank it is in. But maybe someone has or is dealing with the same thing or something similar. Thank You everyone..

Exactly Oldtimr, my loan was sold twice but went under the same banking branches. But, in the situation I am referring to the bank went under. I understand that they may have been forced to sell its assets just like any company would end up doing. But I am not so sure that when a bank is acting like a collection agency if they can add the interest or late fees. My loan was never delinquent. When I put extra money on my payments or even make more than 1 payment in a month they turn and try to use it as extra monthly payments. That got me ticked off once I found out what they were doing. They were just adding on my loan like paying extra payments. Example: I pay $1,000 on a $600 payment and two weeks later pay another $1,000 only to find out that your June payment now is not due until August. This crap has me very upset with them. So anyway you call and ask them what are they trying to do. They give an answer like I had just stated. So you tell them it should be put on the principal not deferred payments. So this is what they are doing now instead. As another example: Because my loan had an escrow account for each $1,000 extra they will put $700 on the principal and $300 into the escrow.. But you will be getting a check sent to you for what’s in the escrow.. Now I have been paying extra so why didn’t all the extra go on the principal? Yes I am very glad to pay this off and getting rid of this damn bank that is for sure!!!