We got a letter from InterContinental Capital Group about a MIP reduction on our FHA mortgage, and it looked official, but I assumed my husband already took care of it so I let my daughter draw on the papers.
Then I took a closer look at it.
Because your loan was originated on ____/2013, you are eligible for a MIP [mortgage insurance premium] reduction...
There's no mention of a refinancing. Not one. Weird. How can they reduce my insurance premiums without a refinancing?
Short answer: They can't.
Out of curiosity, I followed the trail of inconsistencies down the rabbit hole.
The letter claimed to have sent us a notification of eligibility via FedEx on January 13th. We didn't get that. It's not like FedEx can misplace something like that--especially if they sent it like they did in this fancy UPS envelope. We would have opened it, too.
They included an official government memorandum detailing the interest rate reduction for FHA loans to make it look government approved--like yes, the rates can be reduced (conveniently not mentioning that it involves refinancing.)
Next, let's talk about that letterhead. That is just atrocious.
A) Why would you pick the Equal Housing Lender logo as your letterhead? Use your own business logo--you have one, for Pete's sake.. You can put the Equal Housing thing somewhere else. Like the last page or something, like most banks. Secondly, Google a higher-resolution version of your sad, pixelated one, and shrink it down to size. Thirdly, teach your people how to capitalize your logo properly.
This is making my scam spidey sense tingle.
They even had a pixelated QR barcode on the page where they request a lot of information from you in order to open a "case" with them. (Don't mind the bite marks--my cat likes to rip paper.)
So, I googled the company. The Better Business Bureau has lots of complaints about false advertisement; people expected the MIP to be reduced without a refinancing, and were upset when it turned out that it takes a refinancing, and that ICG runs a hard credit report that hits their score big time. Yelp reviews are likewise terrible. There's a smattering of other reports talking about their deceptive practices.
Also, I don't really trust banks that try to hide their finances. There was litigation (and a subsequent settlement) against ICG for trying to hide how bad their finances are.
The complaint alleges that, on eleven occasions, ICG and its principals also transferred funds to the Rainy Day Foundation in order to make payments for borrowers on the lender’s behalf. The indirect payments artificially suppressed ICG’s comparative delinquency and default rates, as compiled and computed by the FHA.
Overall, they get a big fat SCAM from me for deceptive practices.
If you have a FHA loan and get this in the mail--shred it.
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