In 2006, Soto took out a $240,000 three-year fixed-rate mortgage from Eastern Financial Florida Credit Union for a home in Jupiter, Fla. Three years later, the home is in foreclosure and Soto recently filed for bankruptcy. She is now embroiled in a dispute with the Miramar, Fla.-based cooperative to find out why at least five of her mortgage payments were misapplied, she said. Oversights that may have pushed her into foreclosure, Soto believes.
With her husband at the time, they were able to qualify for another mortgage, which brought their total loans past the $500,000 mark, Soto said. Soto's annual salary was roughly $35,000 back then. Her monthly payments on the $240,000 loan started out at $1,500 and went up to roughly $1,800. She acknowledges now that her salary may have been too low to stand up to the monthly loan payments.
"Now, looking back, maybe I shouldn't have accepted it. My ex-husband co-signed it. I would not have qualified. Now, I'm upside down," Soto explained.
Soto's home loan problems started after the divorce. She said she took her ex-husband's name off the deed. While she continued to make the payments, she acknowledged that they would sometimes arrive past the due date. In 2008, Soto arranged to have the mortgage payments automatically deducted from her checking account each month. She said she didn't have a problem with the new payment system until Eastern Financial started taking the payments out of order with other transactions. As a result, she accumulated overdraft fees. Soto ended up having the payments deducted from her savings account.
"It was a nightmare," Soto recalled. "I fought them tooth and nail. The majority of the time they would put it back in."
In March 2009, Soto remarried. She and her husband, an attorney, agreed to have the Eastern Financial mortgage payments withdrawn from a Wachovia bank account. Soto said the credit union withdrew more money than it was supposed to. The first time she chalked it up to a just a mistake, Soto said. But when the same type of transaction occurred again, she was livid.
"After we got our money back, we immediately cut off [the withdrawals from the Wachovia account]," Soto said.
Soto provided Credit Union Times with a spreadsheet of her payment history that showed several payments were not applied toward her mortgage balance. A Sept. 21 e-mail from J. Melodie Munar, an employee at Eastern Financial, appears to back up Soto's case. Munar wrote, "I need someone to help her with her account because there are quite a few payments she has made, and I do not see it...She wants to work with us on getting her file out of foreclosure stage."
In the same e-mail exchange, Soto told Munar and another person identified as Juli Sori that she had a question about where and how much of the $1,846.12 received on May 8, 2009, was applied. The entire amount should have been applied to a February payment. Soto had the same query on the whereabouts of a $2,000 cash payment received on June 18, 2009, which should have been applied to March's payment and "any leftover amount should have been applied to April." According to the spreadsheet and Sept. 21 e-mail, Soto went to Eastern Financial's Boca Mission Bay branch to make a $1,806 cash payment, but it was refused because her account had a hold on it. A staffer told her that she would have to pay three payments minus a partial payment totaling $901 to keep her home from going into foreclosure. Soto said the money was applied to her June payment.
"We are attempting, in good faith, to get our account 'caught up,' but how can we if Eastern refuses cash payments," Soto wrote in the Sept 21 e-mail to Munar and Sori.
In a Sept. 22 e-mail, Sori wrote to Soto, Munar and several other Eastern Financial employees asking for confirmation of the mortgage payments and "is there anything we can do on the workout unit to help our members?" Soto said much of the confusion with the misapplied payments stemmed from several accounts shared by her and an ex-husband. The two had a mortgage together and Soto's ex had a separate mortgage. Eastern Financial's collection department was apparently incorrectly mixing payments between the two as well as with equity line and truck loan accounts.
"As you well know, [Eastern] misposting of payments has improperly put me into foreclosure, and the subsequent freezing of my mortgage account has made it impossible for me to make payments to bring the account current," Soto wrote to Munar, Sori and several other credit union employees in a Sept. 27 e-mail.
Munar sent Soto a loan modification package, which Soto confirmed she received on Oct. 1. According to an Oct. 2 e-mail between Munar and Soto, the credit union requested a signed copy of IRS Form 4506-T, which is a request for transcripts of tax returns, income verification and recent pay stubs. Soto asked if Eastern Financial needed information from her and her ex-husband or her current husband. Her ex-husband's name had been removed the property deed on Feb. 23, 2007, through a quit-claim deed, Soto wrote.
It appears Munar answered Soto's questions but according to an Oct. 6 e-mail, Soto wanted her "issues addressed by higher authority for this is delaying my modification." Munar provided her with the name of a manager. By Oct. 7, Soto had not heard back from the manager. Her misapplied payments had also not been resolved, she wrote in an e-mail to the manager. Not knowing where to turn, that same day, Soto wrote to Robert Hayes, bureau chief of the Florida Bureau of Credit Union Regulation with the state's Office of Financial Regulation about her issues with Eastern Financial.
"As you can see by the e-mails below, I have fruitlessly attempted to seek resolution. I have attached a spreadsheet, indicating my misapplied payments," Soto wrote to Hayes on Oct. 7.
Hayes promptly responded the same day with the following: "Ms. Soto, your e-mail is being forwarded to Mrs. Cindy Ray [an Office of Financial Regulation staffer] to process as a complaint against Eastern Financial Florida Credit Union (A division of Space Coast Credit Union)." Hayes provided his direct extension to discuss how the complaint process works. He ended his letter with "Mrs. Ray-please handle as a complaint against Space Coast."
At press time, Soto said she received a letter from Eastern Financial stating that the credit union will conduct an audit of her accounts to get to the bottom of the issue of the misapplied mortgage payments. Hayes confirmed receipt of Soto's complaint. His office sent a letter to Space Coast on Oct.9 about the matter and is waiting to hear back. When the audit is completed, his office will respond accordingly. While there is no set time frame for the credit union to respond because of the time it may take to gather research, Hayes said his office will follow up if a reasonable amount of time has passed.
"The way we normally handle these complaints is we hear the side of the complainant and we send their complaint to the credit union with our cover letter," Hayes said. "We've had situations in the past where people were able to resolve the matter over the phone."
In an Oct. 21 e-mail statement to Credit Union Times, Space Coast Senior Vice President of Marketing Meredith Gibson said, "It would be inappropriate for the credit union to comment on a member interaction." After soured commercial loan and bad investments depleted its net worth, Eastern Financial was placed in conservatorship in April and taken over by Space Coast. In July the troubled credit union merged into Space Coast and became a division of the Melbourne, Fla.-based credit union.
"In general, Space Coast Credit Union, the parent company for Eastern Financial, has maintained a consistent focus on addressing the financial pressures of members who are negatively impacted by current economic conditions," Gibson said.
The credit union has a team of four specialists "dedicated to working with members who are experiencing financial difficulties associated with their credit union mortgage loans," Gibson pointed out. To date, the credit union has processed modifications for over $80 million of mortgage balances, she added.
Soto said she hired Sherry Cooper, a Florida attorney to help rectify the situation with Eastern Financial. Cooper did not respond to messages from Credit Union Times. Soto's ex-husband, Roger, also did not respond to messages.
The fight to keep her home has at times been a lonely one, Soto lamented.
"Physically, I'm drained. I get more migraines because of the stress. I'm on medicine for anxiety. It doesn't seem like there's an end in sight. If I do have to surrender the house-unless they can reduce the principal..." Soto's voice trailed off. "I'm at my wits end."
Soto said while she's frustrated with Eastern Financial, one of the credit union's employees offered some hope that someone had empathy for her situation.
"On a personal note, I would like to compliment Melodie Munar, who has responded to e-mails and phone calls in a timely manner. She has provided as much customer service as she could provide (given her limited authority) and has been quite helpful in directing me to authority figures in hopes of resolution."