I've had my mortgage since November of last year. My original mortgage company sold it to US Bank home mortgage. I used a down payment assistance program that is to be pay off when the mortgage is satisfied or refinanced. The problem is US Bank is reporting the assistance with my mortgage to the credit bureaus and the result always shows me owning more. I've argued with them and they said that this is a requirement from the credit bureaus as January 2017. They didn't lend me the money the government program did.. Is this legitimate?
If you review the "terms' of your down payment assistance you might find out that it's a "silent second" mortgage lien that is subject to a Recapture Tax which if you sell the property or refinance the loan there is a "pre-payment penalty" that could be due until a certain time period where it's likely to be recaptured or repaid to the provider. If you received a "grant" then that money wouldn't need to be repaid but often times these DPAs come with some of these strings attached.