Can our mortgage holder add rears to our loan balance?

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Can our mortgage holder add rears to our loan balance?

We live in Ohio and have fallen behind on our
mortgage. We finally got approved for a loan
modification and our lender has added over
17,000 to our original balance. We owe
around 169,000 now its approximately
190,000. They called it rears. The unpaid
payments. I dont understand this.

Asked on February 28, 2019 under Real Estate Law, Ohio

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

Yes, it can be added. First, the mortgage agreement itself (which is a contract) almost certainly states explicitly that they can do this--check the mortgage paperwork to be sure, but I would be surprised if it does not say this. Assuming it does say this, that answer the question: the agreement plainly allows them to do this.
Second, this is money you owe them but failed to pay. If they did not add it to the balance, you will have gotten a free benefit: living in your home for time without paying the amount you were obligated to pay for that period. Without adding to the balance so they can recover it, you will in essence have lived "rent free." And by adding it, you don't really lose anything: you should have paid that amount at the time it was due; now you will pay it, just in the future. Thus, the equities (fairness) of the situation dictate that it be added to balance rather than forgotten about.


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