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Good evening, fellow members!

Today I received this letter from Mortgage Auditing Program in my mail:


[Member Name]

This notice is to inform you that you may be owed a refund of several thousand dollars from your mortgage lender. Records show that you signed for a home loan on [date] and that your loan amount was $[amount].

Government studies by the FDIC as well as financial audits of lenders have shown that thousands of mortgages contain mistakes or overcharges. Your monthly mortgage payment may have been miscalculated and you may be due a refund from either your current or previous mortgage lender.

The average refund is $1,497.32 and one third of the refunds equal $3,000 to $7,500.00.

You are eligible for a mortgage analysis and refund review.

Please call 888-xxx-xxxx and reference case # [case number] to begin your refund review.


(I have replaced names, dates and other potential personal identifying information with [tags].)

I have come across a few news articles about the company:

Some things that aren't mention in the letter are:

1. There is a fee associated with a mortgage audit, the articles quoting somewhere between $249 and $299.

2. For most people, the mortgage is calculated right and an audit is thus not worth the money and won't indicate any refund. Notice the letter said "thousands of mortgages contain mistakes or overcharges" but didn't mention that there are 48,394,000 mortgage in the United states. Even if "thousands" means 4,000, that's still only 1 in 10,000 mortgages with a mistake or overcharge. (The odds of errors get better with an adjustable rate mortgage: 20% to 25% of adjustable rate mortgages have errors, as per the Government Accountability Office in a 1991 study. The FSLIC in 1995 concluded that 50% to 60% of all ARMs have errors in the rates charged to home owners.)

3. Even if the audit indicates you are due a refund, you still have to use your own means to get that refund, which means contacting the mortgage lender and, in extreme cases, suing the mortgage lender.

My letter is going into the shredder. I did indeed take out a fixed-rate mortgage on [date] for $[amount], but I had checked with a couple on-line mortgage calculators and saw that interest was accurately calculated and principal was going down by the correct amount.

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