I'm from the US and I've recently applied for HELOC refinancing at a much lower rate (-2.00%), but underwriter has decided to deny the application due to a single late mortgage payment made in Jan 2017, which is explained as follows:

In December of year 2016 we received the escrow assessment statement, which stated that from 2017 onward, the mortgage payment would be increased by $14.00. The bank I'm paying the mortgage is within the reasonable distance, so I always go there and personally handout the check to the clerk, who then gives me the receipt and I sleep in piece knowing that the payment was made on-time, but because of one government regulation put in place in recent years, partial payments cannot be posted to the mortgage account, so the bank reported it as a late payment and like a clockwork all three of the credit reporting agencies reporting it as such.

I understand that it is my responsibility to keep track of changes in personal finance, but I'm also a human, who forgets things every once in while; Now because of this single mistake, I'm being punished for the rest of my life.

My question is: what can I do do fix this?

To further expand on the story, after I had made a partial payment (short of $14.00), someone from the bank reached out to me after 15 days over the phone asking for an additional $14.00, which I made immediately, but I do not remember anyone informing me that I was going to be reported for the late payment. Also, the clerk at the bank whom I personally handed out the check didn't inform about the shortage either.

I understand neither the rep. who called me nor clerk at the bank may not be responsible for informing me on anything I've said above.

Update 1: I called the mortgage bank on 4/5/19 and the rep. told me there's nothing they can do. However, I asked for escalation and waiting for next steps...

  • 2
    I'm going to assume this is the same bank that holds your mortgage? Have you talked to other lenders?
    – quid
    Apr 5, 2019 at 16:58
  • Nope, it's a different bank. I'll be talking to other lenders for sure, but at the moment, I've chosen the lender among many based their current rate. I'm also going to ask for the detailed letter from the mortgage bank explaining the issue in more than just "late payment" that it was in fact no more than $14.00.
    – Ostati
    Apr 5, 2019 at 17:03
  • Different banks have different underwriting criteria. The banks offering the strongest rates are looking for the lowest risk borrowers. If I were in your shoes I wouldn't waste too much time on this lender; on to the next one.
    – quid
    Apr 5, 2019 at 17:05
  • 4
    "Now because of this single mistake, I'm being punished for the rest of my life." Actually, it will drop off your credit report after 7 years, and since its 2019 now, less than 5 to go.
    – Glen Yates
    Apr 5, 2019 at 17:47
  • 5
    In general, late payments don't get reported unless they are 30 days late; according to your statement, you corrected the issue after roughly 15 days. What does your credit report actually say about this? I see from your question that "all three of the credit reporting agencies reporting it as such", but that would mean it would be 30 days late, not 15 as you've indicated.
    – Istanari
    Apr 5, 2019 at 17:53


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