Product: Mortgage

XX/XX/XXXX Notified by XXXX that my credit score was decreased due to past due situation with XXXX XXXX. 

XX/XX/XXXX Called XXXX XXXX  to find out why the account ( which I am a co-borrower with my daughter ) was showing past due. They told me that in XX/XX/XXXX they sent a letter informing us that the payment would be increasing {$53.00} ( {$1800.00} vs {$1800.00} ) effective XX/XX/XXXX due to increase escrow impounds. 
My daughter was in the process of moving overseas temporarily in XXXX. She put my address for all her mail to be forwarded. I looked for any correspondence from XXXX and did not find any. 

A payment of {$1800.00} has been made every month by her bank 's ( XXXX XXXX ) bill payment system. The person I spoke with told me since it was not the full amount they put the money in suspense until enough funds have been paid to process a full payment. She also verified that a payment was received every month on or before the due date of the loan. 

She said if I paid {$1900.00} it would bring the account current. I asked about the money in suspense and they said it will take a while to clear. 
I assumed that since this amount plus the amount in suspense would cover the payments for XXXX and XXXX. I paid them through my checking account. 

XX/XX/XXXX I called to see if the money had been credited and was told that the account was still due for the XXXX payment so I asked when the money will be cleared from suspense and they said there is no money in suspense. I then asked where did it go and they then said that the company applied it to principal reduction on XX/XX/XXXX. I said we did not ask for principal reduction why would they do so? 
They said that is their policy. I then told them I would complain to CFPB and then the person referred me to the 'escalation dept '. 

I asked escalation person why am I being assessed a {$69.00} late charge for a {$53.00} shortfall. I find out there has been XXXX late charges assessed I also asked the escalation person why the money was credited to principal reduction when we did not direct them to do so. No explanation was provided. 
She told me that {$1600.00} was applied to principal which I did not understand because it did not match the amount we paid. 
It was explained that the amount was the monthly payment that we sent in less XXXX monthly shortfalls plus {$69.00} in late charges. 
I told her to reapply the money toward the monthly payment and to refund the money taken from my payment and paid to their late charges. 
She agreed to do so. 

I then asked about removing the negative credit bureau report that said we were XXXX  days late. She stated that this request must be sent to their 'credit dispute department '. 

XX/XX/XXXX Called XXXX to see if the money has been taken out of principal reduction and back to the suspense account. XXXX informed me that on XX/XX/XXXX the money was put in suspense and then on XX/XX/XXXX was place back to principal reduction. I asked why was this done and was transferred to the XXXX XXXX ' again. The person I spoke to did not know why this happened and also said that the reimbursement for the paid late charge was not processed properly. She said she would correct it. I asked her if this was the first time she had this type of complaint and she said no it is not. 


Summary I believe that XXXX 's policy of applying monies sent in for monthly payments to principal reduction enables them to charge late charges when a payment is not paid in full. In our case after XXXX months we were short {$210.00} and they had assessed XXXX late charges totaling {$270.00}. To me this is a blatant attempt to increase late charge income at the expense of the consumer, especially unsophisticated people who do not understand the finance business. 

Please remember the shortage was for a impound account not the loan and the amount past due was less than 10 % of a single payment. 
Is misapplying money to principal reduction a way for XXXX to cheat the consumer? 

I HOPE THAT XXXX IS WRONG IN THEIR ASSUMPTION THAT THE CFPB WILL NOT DO ANYTHING.