Legal Question in Banking Law in Wisconsin

It is indeed true that mortgage lenders can refuse to accept anything less that the full amount due in a lump sum under the terms of a standard WI mortgage contract. The reason for this is that they might legally waive their right to foreclose due to this default if they accept the partial payments. The typical point when this may occur is when you are 60 days past due, at which point they may send a required notice known as a right to cure your default. If you fail to do that within the notice period offered to you (possibly 20 days), they can declare the entire amount of the loan due in a lump sum. This effectively triggers a foreclosure unless you can either sell or refinance or timely pay the past due amount. All this being said, I would urge you to make whatever payment you can afford, even if they are telling you that they will not accept it. At worst, they will either return it to you or place it into a "suspense account" which they will hold but not apply to your loan unless they decide to either waive the default of reinstate the loan. Having these suspense funds on deposit with them will only help you in future negotiations, giving you the cash to back up any promises which you might make with regard to catching up on your payments. Calling them before you make a partial payment is probably a waste of time, since you will only end up talking with a person who is reading from a script and who has no discretion to allow anything other than the full amount due. That is not to say that the bank's computer system (or other bank staff) may not accept the partial payment regardless of what the phone operator said. In the current real estate market, your odds of getting the bank to make exceptions to the normal rules are better than average. However, any proposals are far more likely to receive serious consideration if they are backed by cash payments which the bank has already collected. Finally, as a last resort, a chapter 13 bankruptcy can force the bank to accept payments again and catch up on the past due amounts over a five year period. You should therefore have a discussion with a bankruptcy attorney so that you know all of your options. My comments here are not intended as specific legal advice for you, unless you subsequently retain me a revisit this issue with me. Good luck!