I had my most recent mortgage with GMAC. I recently refinanced with Citicorp. Upon paying off my loan, I noticed on my GMAC statement I had X amount of dollars in my escrow account with GMAC. When I received my escrow check from GMAC I was surprised to see it was $600.00 less than what was on my statement. When I called GMAC they said they take a portion of the escrow and pay part of the balance down and that is the payoff amount they give the new mortgage company.
The problem is I never authorized GMAC to do anything with my escrow other than pay my taxes and insurance and why would they put $600 on the principal of a mortgage when it is about to be paid off? Has anyone ever heard of this? When I called the lady at GMAC she said it is common practice for every mortgage company to take part of your escrow and pay your mortgage down before it is paid off.
It makes no sense to me and now I have to come up with the escrow that they have already spent. If anyone had ever had this happen or knows that it is a common and legal practice, please let me know.
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