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Yet Kachline said she won't breathe easily until she resolves all
tax bills that are still outstanding.
"I'm going to spend all of Christmas week calling people myself
unless this is straightened out soon," Kachline said Tuesday, less
than 24 hours after she alerted township supervisors of the problem.
"I don't want to lien taxpayers who shouldn't be liened Someone
dropped the ball on this somewhere down the line."
Although the details of the mix-up are still surfacing, it appears
as if at least part of the problem arose when the large residential
lender Wells Fargo Home Mortgage purchased billions of mortgages from
First Union Corp.
At least one other lender -- Washington Mutual Inc. -- also may be
involved, Kachline said, although that could not be confirmed with
Washington Mutual officials.
As she sorted through the unpaid property tax bills this week,
Kachline urged taxpayers in the township of 12,000 to call her office
and check whether their bills are paid.
Tax bills are due by the end of this week, although Kachline said
she would probably give a grace period of one to two days and extend
the deadline into early next week.
Sifting through Hilltown's property tax accounts, Kachline
discovered that some homeowners with escrow accounts who had been
religious about paying bills in the past had not paid this year.
Soon, she suspected that lenders -- which hold money in escrow to pay
property taxes and homeowner's insurance -- hadn't paid the tax
bills.
"I've been tax collector for eight years and I've never seen
anything like this before," Kachline said.
" I think it's just sloppiness at this point," she added. "It
certainly doesn't behoove any lender to do this, because it is the
one that has to pay the penalties."
Escrow accounts are usually created when homeowners close their
mortgage loans, according to information on Wells Fargo's Web site.
The lender holds the account to pay recurring bills such as property
taxes and homeowner's insurance. Many lenders and banks, Kachline
said, insist on escrow accounts to ensure that insurance and property
taxes are paid.
Kachline has spent a good share of her time working with Wells
Fargo officials to solve the problem, which was probably an oversight
on Wells Fargo's part, said Dan Frahm, a spokesman for Wells Fargo
Home Mortgage in Des Moines, Iowa.
In September 2000, Wells Fargo bought $35.7 billion in mortgages -
- in a deal that represented 400,000 homeowners -- from First Union
Corp., Frahm said.
Frahm said his company has been alerted to a similar problem in a
handful of counties in South Dakota, and is now researching the
Hilltown incidents. He could not say how many property tax bills have
not been paid in either Bucks County or South Dakota.
"It's not uncommon, unfortunately, for customers to learn that
their property taxes have not been paid from escrow," Frahm said.
"Unfortunately, there are periodic mistakes. We will correct any
errors to the complete satisfaction of our customers and we'll absorb
any penalties."
Bucks County homeowners can call a toll-free Wells Fargo hotline -
- 800-288-3212 -- if they have questions about unpaid property taxes,
Frahm said.
The potential for mistakes has increased in the last two decades
because more and more lenders are selling mortgages to other
financial institutions or contracting with outside companies to
service the accounts, the president of a national consumers group
said Tuesday. "Most lenders do pay [property tax bills] but a lot of them use outside service companies to service and monitor the tax bills," said
Richard Roll, president of the American Homeowners Association, a
consumer group that helps homeowners protect and maintain their
homes.
With the trend toward consolidation, there's always a chance that
a homeowner's mortgage will be sold to a lender or service company
that's less careful than the previous lender or service company, Roll
said.
With interest rates low, lenders scrambling to buy and sell
mortgages are "operating at capacity," added Bruce Watterson,
director in the financial advisory services practices group at
PricewaterhouseCoopers of New York, which helps corporations solve
business problems. "Service transfers are particularly difficult.
Both sides could be acting in good faith" and yet one or both could
make an innocent mistake, he added.
Wells Fargo and First Union are "two of the largest players in the
marketplace," Watterson said. "Both have been through mergers and
acquisitions. Both have to adapt to new equipment and systems."
As a precaution, homeowners should always check with their
township or borough at the time when property taxes are due, Roll
said.
"It's a good idea to do a spot check," he said.
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