Years ago - back in the dark ages of the 1970s - the federal government, via the US Dept of Agriculture, offered an "interest credit loan," for rural housing. It seemed like a great idea to a young couple who hated living in a "mobile home." We bought our house with such a loan.
At the time, our payment was set at $357 a month, but the government would "credit" our interest based on our income. Our first payments were $197. Every year we were re-evaluated, and, as our income grew, so did our payments.
Along the way, our payments were adjusted so that the most we would ever pay was $306 a month. I'm not sure what reasoning was behind that, but there it is. Oh, and didn't mention that our loan was for a period of 33 years. And that, of the $32,000 we borrowed, we'd pay back over $112k. They breezed past that in the loan discussions, saying that in the distant future, we'd have made so many improvements to our home it'd be worth that. Until last year, that wasn't even close to being true. It might be true now - we haven't had the house fully appraised since we've done all the remodeling.
Fast forward to 2010. February of 2010. Each month, about the 5th through the 8th, we get a payment coupon for this loan. The payment is due on the 13th, so there isn't any wiggle room. Almost always, we put the payment in the next mail, knowing, from past history, that the Rural Housing Service (RHS, used to be Farmers Home Administration, FmHA) is very cranky if the payment is not in its office on or before the 13th.
The coupon arrived here on February 9th. We mailed it out the next day, the 10th.
On the 20th, Saturday, we got a letter from the RHS, saying "You have previously been notified that your account is in default for the aount stated above [one payment] and that if not rectified immediately, any government funds you receive, such as Income Tax Refunds or Social Security Benefits, will be offset until this balance is cleared."
Past history (and we won't go into all of that here - suffice it to say that the USDA RHS has done its level best to steal our home!) has made us very leery of such letters. Our attorney can testify to that! We both went into high blood pressure mode and after we calmed down, we decided I'd call, knowing we'd sent the check in plenty of time and that no previous unpaid balance exists.
I called Monday morning. After giving both our Social Security numbers to be sure, I was told that our account is in good standing. There is no unpaid balance, and the letter must have been generated in error. The customer service rep checked twice to be sure we had no other accounts which might be referenced by said letter. There was no notation of such a letter having been sent in our record. Our check posted in their office on the due date, February 13. Ok. Fine. Ignore the letter.
Faron came home from work Monday evening, bringing the mail with him as he came. A letter from the US Department of the Treasury was among the junk mail. "This letter is to notify you that your Social Security benefits will be offset by no more than 15% of the total to bring your account with the USDA RHS into current status."
Two blood pressures soared to dangerous levels!
It was only 5:30 our time. The USDA RHS is in St Louis, MO, so would still be open. I called immediately. I waited for 15 minutes while the woman with whom I'd spoken that morning spoke with her supervisor and investigated our account, trying to figure out why such letters had been generated. Finally she came back and said that they were both in error, and we could ignore them. Yeah. We have learned to our cost that one does not "ignore" letters such as these!
She did suggest we wait until Thursday to call the Treasury Offset office, to see if they actually do receive an account for collection. She said that their system resets every Saturday, and that it would take until Thursday for that office to get an updated list of accounts. So I did as suggested and sure enough, there are no liens against our Social Security numbers.
Just typing this up has my heart pounding! And this is the federal government, people, that wants to run our health services? They can't even tell if someone has made a payment on time on a simple in and out account - how will they be able to track the health records of billions of people? It's terrifying, that's what it is!
I do plan to call the USDA RHS again this coming Monday, to ask that a letter be issued declaring those two previous letters to have been sent in error. I want to be able to attach them to the letters for our records. I don't trust those bozos one bit!
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