Thursday, February 12, 2009

Local Business Offers Assurance in National Economic Uncertainty

(From the February 12, 2009 Grand Haven Tribune)

The worst part of the current economic situation is the uncertainty. People who have been laid off wonder if and when they’ll get a new job, what kind of job, how much it will pay. People who have jobs wonder and worry if they’ll still have a job in a few months. Homeowners and businesses wonder if they’ll be able to get loans for homes, buildings and new ventures. College students wonder about getting student loans for next year’s tuition. Everyone wonders if the stimulus will work or not, and when.

Add to that the uncertainty that comes with working with large, national businesses and mortgage companies in this climate. I feel fortunate that I have a job and am able to pay my mortgage and insurance premium. I am pretty confident that at least my personal accounts are in order.

But, unfortunately, nearly all of us have to do business with large, national companies that have been mentioned as part of the national economic meltdown. Last month, an experience I had with Countrywide, the giant mortgage company, added to my uncertainty about the competence and integrity of some of our nation’s largest financial institutions.

It started with an innocent looking piece of mail from Countrywide. I almost threw it away, figuring it was junk mail. Don’t get me started on that—many blame ‘predatory’ lending practices through relentless marketing for getting lots of consumers in over their heads in the first place. But that’s a subject for another column. I opened the letter just to be sure what it was and was shocked to read that I didn’t have adequate homeowner’s insurance and that Countrywide would be forcing “lender-supplied” insurance on me.

This is where the uncertainty was created. I knew for a fact that my insurance policy was adequate and that premiums were paid up. So was Countrywide incompetent for not keeping accurate records? Or was there something more sinister at play—an attempt to force one of their other products on me? I was uncertain.

Of course, these sorts of letters always come on the weekend. When I tried to contact customer service all I could get was an automated message telling me the status of my account and so forth. I would have to wait til Monday to talk to someone and sort out this mess. Ironically, I received an email from Countrywide that weekend saying they had a special on home equity loans and that customer service agents were available all weekend long! But that was for new (i.e. unsuspecting customers). No help for poor saps like me who are long-time customers who are being wronged.

A quick side note on that. Am I really a customer? I never had a say in whether or not I would do business with Countrywide. And I can’t take my business elsewhere. As many of you know, when you apply for a home loan even at a local bank, that loan is sold to a large mortgage company for servicing, often before you even make your first payment. We have no consent. Given the negative news I’ve seen of Countrywide for excessive executive compensation and special favors to heads of Senate committees, I would take my business elsewhere. But I can’t. I’m not a customer—I’m a hostage.

So on a Saturday at home, while Countrywide focused on reeling in new customers, I was left on my own. I did note the letter said something about updating information on their web site. So I logged in to my account, entered the details about my insurance policy, and clicked submit. I hoped that was the end of it. But I was still uncertain. So I contacted my local insurance agent, Ron Knoll of the Oakes Agency. It was still the weekend and I expected I might hear back from him Monday. But he responded within the hour, assuring me he would contact the mortgage company first thing Monday and straighten things out.

He did. He called me Monday before noon and said he had confirmed that both his agency and my insurance company had sent the latest policy information to Countrywide. I thanked him and felt reasonable sure that with my update of the web site and his call of confirmation the situation was over.
But no. I got another message from Countrywide saying it wasn’t settled. I checked the web site and noticed the data I had updated had been changed back to what they had before. I was furious. It was the weekend again, so no help available from a real person at Countrywide. So I emailed Ron again.

That Monday he was on the phone again and insisted on a letter from Countrywide confirming my account was in good standing. I received that later in the week. And then, hilariously, the next day I received a letter dated a week earlier saying I still had inadequate insurance. No doubt the nasty letter was automated. At this point, I just laughed.

“Caveat emptor” is an old expression in business. From Latin, it essentially means “buyer beware.” In other words, it is up to buyers to ensure that they are getting good quality for what they buy. But that’s hard to impossible for us to do in all cases these days when dealing with large businesses that automate so much of their relationships with people.

In these uncertain times, I am glad for local business people like Ron Knoll. He makes it his business to look out for me. Others seem to overlook us to look out for their business. I’ve never met anyone from Countrywide, yet they control my largest financial investment. My local insurance guy I know. I see him in coffee shops and riding bikes along Lakeshore Drive. It’s a small thing, but I appreciate the certainty that comes from working with local businesses.