Consumer complaint received 2019-06-17
Company: Rocket Mortgage, LLC
State: AZ
Product: Mortgage
Sub-product: VA mortgage
Issue: Trouble during payment process

Complaint:
I recently refinanced for a lower interest rate and now have a VA Loan with Quicken ( Rocket Mortgage ). The interest rate is 3.75 % APR. I have signed up for bi-weekly payments. After a few months of making bi-weekly payments I noticed the first payment each month was being held and not applied until the second payment was made. I contacted Quicken and asked them to start applying the payments as they were made. Quicken responded by saying they hold my first payment each month and don't give me credit until the second payment is made, but that my only advantage to making bi-weekly payments was the ability to make one extra payment per year. Quicken is reaping the benefits of early fund payments throughout the year, which should result in a reduced principal to me and less overall interest paid. Instead they are pocketing these extra funds. I am a XXXX-veteran and this is a VA loan. Are there any protections for me here and can this be forwarded to the VA for review of how Quicken handles all VA loans? 

I am pasting the conversation thread below with personal information removed. 


... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... ... 


Thank you for contacting us. I do apologize for any concern with the bi-weekly autopay! Whenever a partial payment is made on a monthly mortgage payment, it is placed in a suspense account until the remaining balance is received for that month. In this case, when the second half of the XXXX payment drafts on XX/XX/XXXX it will combine with the funds currently in suspense and be applied towards the month of XXXX. 



The bi-weekly auto pay saves you interest on the life of your loan because you pay more on the principal every year. Although we hold the first half of the payment and post the funds once the full amount is received, there is an additional half payment twice a year. These two extra half payments per year are directly applied towards the principal balance. 



In other words, the bi-weekly auto pay allows you to pay 13 payments per year rather than 12 payments, and the 13th payment is all applied towards your principal balance. Extra principal payments reduce the length of your loan, thus saves you interest overall. 



If in the future you have any questions or concerns about your loan, please feel free to contact the Client Relations Team as we are always happy to assist. I hope you enjoy the rest of your day! 



Remember, you can chat with us, view your account information, set up paperless billing, and schedule one-time and automatic payments on your Rocket Mortgage account. 





Sincerely, <Name Removed> Quicken Loans Client Relations Monday -Friday XXXX - XXXX EST Saturday XXXX - XXXX EST Chat with a Client Advocate : Click here Every client. Every time. No Exceptions. No Excuses. 





1 ) I contacted customer service in XXXX and asked for this loan to be put on biweekly payments. I see my payments are scheduled biweekly but they are still being applied monthly. I specifically asked for this to take advantage of the early payment benefits from biweekly payments. Please adjust immediately. 

<Name Removed> <Name Removed> XXXX XXXX ( 19 minutes ago ) to Quicken <Name Removed>, So you're telling me that Quicken holds XXXX half payments and has the use of those funds all year long without giving me credit for the reduced days of principal each month? That adds up to quite a large amount over the life of the loan and does not offer the full benefits most institutions give for bi-weekly payments. I'm going to check with the VA on their stance for this practice and ask them to review how Quicken treats VA loans across the board. However, I will give you a high rating on your performance as your response was prompt and you seem knowledgeable and presented the information concisely. 

Regards, <Name Removed> On Mon, XX/XX/2019 at XXXX XXXX   Quicken Loans XXXX wrote : Good morning, Mr. <Name Removed> Thank you for contacting us. I do apologize for any concern with the bi-weekly autopay! Whenever a partial payment is made on a monthly mortgage payment, it is placed in a suspense account until the remaining balance is received for that month. In this case, when the second half of the XXXX payment drafts on XX/XX/XXXX it will combine with the funds currently in suspense and be applied towards the month of XXXX. 



The bi-weekly auto pay saves you interest on the life of your loan because you pay more on the principal every year. Although we hold the first half of the payment and post the funds once the full amount is received, there is an additional half payment twice a year. These two extra half payments per year are directly applied towards the principal balance. 



In other words, the bi-weekly auto pay allows you to pay 13 payments per year rather than 12 payments, and the 13th payment is all applied towards your principal balance. Extra principal payments reduce the length of your loan, thus saves you interest overall. 



If in the future you have any questions or concerns about your loan, please feel free to contact the Client Relations Team as we are always happy to assist. I hope you enjoy the rest of your day! 



Remember, you can chat with us, view your account information, set up paperless billing, and schedule one-time and automatic payments on your Rocket Mortgage account. 





Sincerely, <Name Removed> Quicken Loans Client Relations Monday -Friday XXXX - XXXX EST Saturday XXXX - XXXX EST Chat with a Client Advocate : Click here Every client. Every time. No Exceptions. No Excuses. 


************************************************************************* 1 ) I contacted customer service in XXXX and asked for this loan to be put on biweekly payments. I see my payments are scheduled biweekly but they are still being applied monthly. I specifically asked for this to take advantage of the early payment benefits from biweekly payments. Please adjust immediately.

Company response to consumer: Closed with explanation