Consumer complaint received 2023-03-03
Company: SELECT PORTFOLIO SERVICING, INC.
State: FL
Product: Mortgage
Sub-product: Other type of mortgage
Issue: Trouble during payment process

Complaint:
Customer Name ( s ) : XXXX XXXXXXXX XXXX XXXX XXXXXXXX XXXX XXXX Account Number : XXXX Property Address : XXXX XXXX XXXXXXXX XXXX XXXXXXXX, FL XXXX Phone XXXX Email XXXX What happened : In the month of XX/XX/XXXX, I closed XXXX purchase transactions with The Lender based out of XXXX. They are a NON -QM Portfolio mortgage company as their main niche. The loan program we used was the XXXX, which is an investor loan with no income. 
The first payment for those XXXX loans were in XX/XX/XXXX, with automatic ACH payments. 
In XXXX The Lender sold off my loans to their sister company XXXX XXXX ( the servicing branch for The Lender ). 

A very important note worth mentioning, is that if the ACH automatic payment was not set up in the beginning, the interest rate would have been 0.25 % higher, so it made financial sense to have this ACH set up for all loans, which I did. 

In the month of XX/XX/XXXX, all of the XXXX mortgage payments were paid around the dates of the XXXX to the XXXX of the month successfully though ACH Automatic payments.

This indicates, and sets the precedence that the ACH document work and is in effect, as well as the bank account information being accurate, as the mortgage payment were paid successfully without my direct involvement. 
So long as I have the required money in my bank account there would be no issues. 

This is where the problems start : In XX/XX/XXXX, the loans were transferred from XXXX XXXX to SPS for servicing. 
I as a customer have no control over the passing form XXXX servicing company to another. 
I have no control over the technical issues in internal to the transition. 
Again, so long as I have the required money in my bank account there would be no issues. 

XXXX of the XXXX loans transferred from XXXX XXXX to SPS for servicing were paid through ACH without any problem. 

However, this particular loan SPS Account number : XXXX, in this case, SPS never attempted to charge the mortgage payment for the mortgage in the month of XXXX and XXXX. 

I was never notified by email, or by phone call, or by text that there were problems with SPSs the automatic payments systems. 
It wasnt until l XXXX when we find out from a letter that was mailed to the rental property I purchased back in XXXX. 
I come to find out later in XXXX that allegedly a letter was mailed to me, that I never received. There is no signature confirmation that a letter was delivered to me directly. I remind you, this was an investment purchase, and my primary residence is at another location, where my mail is opened and addressed daily. 

The XXXX XXXX investor loan program has a pre-requisite of needing to own and reside at a primary residence in order to participate with the Investor no income XXXX  program. 

Why in the world would critical mortgage information be mailed to the rental property for a tenant to have direct access to the mail? 
Wouldnt it make much more sense to mail to the clients home address to be able to promptly respond? 
Is it possible and likely that some tenants disregard any mail that is not theirs and dismiss as junk mail? 
Of course its the right thing to do top return to sender or call the landlord out of respect, but sadly not all people use common sense and common courtesy. This is what happened to me in this case. In my opinion, this is also part of the lackluster process SPS has in place. And I will also add to them The XXXX  and XXXX XXXX for that matter. 
This is another mistake in communication inadvertently created in this process, and yet another wrinkle disconnecting, and disjointing the client form their own loan. 
CFPB, please make them fix this mess! 

Nevertheless, approximately XX/XX/XXXX was when I called SPS to inform them, that I had no idea that their systems were not working with the automatic ACH payment on XXXX of the XXXX loans. 
I can provide you proof to show you that the payments were paid out of the same Bank XXXX XXXX XXXX banking account XXXX XXXX XXXX. All XXXX mortgage were set up with the ACH automatic payment identically, and funds were available to pay the third loan. The SPS representative was on a XXXX phone conversation along with my loan officer XXXX XXXX and his loan partner XXXX XXXX XXXX XXXX work at Certified Mortgage Planners in XXXX XXXX Florida . 
Both very professional and very helpful, kind and protective of my needs. They are not part of any of these problems, just to be clear. 
We spoke at length with the SPS rep, possibly over XXXX hour. 

The SPS representative admitted on a voice recorded call that since there was an error with the automatic payment on their end, we had to send a new ACH documentation again, which the SPS rep email, and I completed that same day while on the phone call with SPS. 

The SPS representative told me that the payments that were not paid for XXXX and XXXX would be repaying by his suggestion what is owed for those XXXX months in XXXX installment payment amounting to {$4800.00} each, to make the payment corresponding to the monthly mortgage, plus the XXXX months divided into XXXX months, and that in XX/XX/XXXX, I would be back to paying the original installment of {$3600.00} again. 
We ended the call, and thankfully everything was great. So I thought, the recording was saved in your archive as a critical reference point, so please subpoena that call so that you can listen to essential information. This will remove the accusations and will be much more clear cut lies and abusive tactics by SPS. 
CFPB, please make them fix this mess! 


The BIG Con-JOB- The 20 % Rate jack up In XXXX, we come to find out that unfortunately, everything was not as we thought once we ended the 4-way phone call with the SPS rep. As it turns out, in XXXX without notice, SPS began to put an annual interest of 20 % that with that in XXXX I have a more than {$60000.00} of accrued interest based off of a 20 % rate. 
How can this be? 
Thats another major issue!! 
Probably the worst of all. 
In the original contract that I closed with The XXXX there was never ever mentioned a rate spike to 20 % if I had a late payment. I remember at the closing, I questioned the Notary who explained what documents I was signing, simply said the rate was maybe something to do with the adjustable rate mortgage market it might be based off of. 
He never warned me point blank, if you pay late, your rate will be 20 %, or else I would have NEVER SIGNED and I would have looked for a different lender with less drastic terms right there at the closing table. 
I was tricked into signing this document! 
This type of risk is too much for my taste, and on top of that, if the late payment was triggered by XXXX own faulty systems that never attempted to draft my ACH payment, and essentially trapping me as a client with a 20 % rate. 
How many others have suffered at the hand of this con??? 
CFPB, please make them fix this mess! 

As you can see here, it would take a XXXX from XXXX. to decode that this says, if you pay late the rate is 20 %. 

DEFAULT RATE : THE RATE OF TWENTY PERCENT ( 20.00 % ) PER ANNUM. HOWEVER, AT NO TIME WILL THE DEFAULT RATE EVER EXCEED THE MAXIMUM INTERST RATE. 
DETERMINATION DATE : MEANS WITH RESCPECT TO EACH RATE CHANGE DATE : ( XXXX ) IF THE INDEX IS COMPOUNDED XXXX, XXXX. ( XXXX XXXX  TIME ) IN THE U.S. GOVERNMENT SECURITIES BUSINESS DAY MOST RECENTLY RECEDING SUCH RATE CHANGE DATE ; ( XXXX ) IF THE COMPOUNDED XXXX  DOES NOT SO APPEAR ON SUCH DAY, XXXX. ( XXXX XXXX  TIME ) ON THE FIRST PRECEDING U.S. GOVERNMENT SECURITIES BUSINESS DAY FOR WHICH SUCH RATE Was published by the index source; ( XXXX ) IF THE INDEX IS TERM XXXX, THE DATE AND TIME DETERMINED BY LENDER IN ACCORDANCE WITH THE SOFR ADJUSTMENT CONFORMING CHANGES ; OR ( XXXX ) IF THE XXXX IS A BENCHMARK REPLACEMENT, THE DATE AND TIME DETERMINED BY LENDER IN ACCORDANCE WITH THE BENCHMARK REPLACEMENT CONFORMING CHANGES. 
DISBURSEMENT DATE : THE DATE OF THE INITIAL DISBURSEMENT OF LOAN PROCEEDS HEREUNDER. 

Are your eyes as crossed as mine are trying to understand that this in face says that if you pay the mortgage late whether by your error or the lenders error, your rate spikes to 20 %? 
I read this and re-read this over XXXX XXXX times, and it still makes no sense or connection to the mortgage rate increasing. 

Not even the Title closer who explains what the client is signing as a career, knew what this said and never brought up in plain XXXX the disclosure that the rate can ever change to my mortgage. 

This almost seems like a generic clause that talks of a market of what the adjustable-rate mortgage is based off of, but not a rate change if you pay late, so since there were no reg Flags raised by the notary and even he could decipher its true encrypted meaning, I went ahead and signed. 

This might be a Class Action Level violation. Im not an attorney, but who knows if it gets to that level. 

In the Promissory Note, on page XXXX, there is encrypted and non-specific language about a 20 % rate. There is no clear explanation that if you make a late payment, the rate automatically increases from 5.625 % to 20 %. This is another problem entirely. 

Back on XX/XX/XXXX, I called to speak to a SPS representative only to find out what happened and why the rate is at 20 %. 
The communication process has been horrific at best. 
XXXX department making a claim, is not in the file that the rep taking the phone call is referencing. 
And even worse, false records are being entered that do not corroborate with my verifiable bank records, as well as call made to my bank XXXX XXXX XXXXXXXX when I asked them if and when SPS attempted to draft the ACH payment for Account Number : XXXX for a payment in the amount of {$3600.00}. 
The XXXX XXXX XXXXXXXX rep told me that no such payment was ever attempted. I asked for them to put that in writing, and since XXXX XXXX XXXXXXXX is a BIG BOX lender, they only have system preselected letters that they can send me, none of which sadly have the specific verbiage to my unique circumstance. 
However, I invite you to be party to a XXXX call or feel free to subpoena their records to verify what I am stating to be accurate. 


We have been told a lot of contradictory information by SPS ; such as that false claim that they attempted to draft payment on XX/XX/XXXX, and that my bank rejected them. 
This is totally false. I have called and confirmed with XXXX XXXX XXXXXXXX on the phone call that SPS never sent a request for that amount in XXXX or XXXX. 
XXXX XXXXXXXX XXXX verified on the phone call that they only have the XXXX requests for the other XXXX SPS loans which where were paid accordingly from XXXX XXXX  XXXX business banking account XXXX XXXX XXXX. 
I have nothing in my bank statements to confirm or verify that SPS tried to process payment for the third loan. 

Furthermore, it was not possible as I had ample liquid funds in the balance to be able to pay that amount on the days that needed to be paid ; thus its technically impossible that a payment attempt was made by SPS. 

The SPS representative said that the notes indicated that a payment was attempted, and the payment didnt go through. 
This is a false claim and a fabricated internal note to cover their trials of negligence. 
That is a faulty note and is absolutely inaccurate. 
The bank records can prove this. 
There is also no record of an overdraft charge by XXXX XXXX XXXXXXXX, no bounced check fee, nothing. 

SPS rep referenced a note that reads that A payment was attempted and failed. 
It is a mistake, error, and moreover a lie. 

I have the bank statement in Transaction History format to prove that I had XXXX to XXXX times the available liquid funds needed to make the mortgage payment and was available on XX/XX/XXXX. 

I also have the full cycle bank statements for XXXX to show that there is no record of an overdraft fee for that payment, as it was never attempted. If an over-draft occurred, I would have had to pay for that service penalty. No such charge or fee on my statement. 

Approximately in XXXX, I was in the process of closing on another unrelated property refinance on another property, and during the verification of the mortgage process [ XXXX ], the lender needed to verify my mortgage payments being current for the last XXXX months. 
Everything was in order for that financing, and I closed on that deal in XX/XX/XXXX. 

There would have been a problem with that loan, and it would not have closed had there been record of XXXX mortgage lates inside of a twelve month period. This was literally 1 month after the 4 way phone call setting up the XXXX months repayment over the next 6 months to be caught up. 

The point why I am explaining this is because due to the SPS form failing to collect the ACH payment, the rate was automatically increased to 20 % and was imposed on me, the customer. 
I find this experience to be fraud, and Predatory. 
I waited for an internal review and more than 30 days later, a new and different SPS rep calls to inform me that the rate will not be reduced and I still owe over XXXX to get caught up. 
This is also mathematically impossible as by their claim, if a payment was late in XX/XX/XXXX and if the rate was raised to 20 % the interest would have only been in the XXXX range, not {$80000.00} range. 
So, to add on top of all that I have listed in this letter, they now are adding fictitious interest. 
More Fraud!!!!!!!!!! 
CFPB, please make them fix this mess! 

We ask that you review my bank statements to verify that what we are writing is true, authentic, and accurate. 
I also request to remove 20 % I never canceled the ACH payment function. 
Somehow, SPS did this without my consent and are penalizing me for it. 

Please check the SPS audio recordings and you will find no such verification. 
I would never ever remove an ACH automatic payment. That crazy to even think its something a sane customer would think would benefit them. 
We are very distressed with all these problems, and we want a solution since we understand that there are human errors and software system malfunctions, but not erros on my part. 
They should take responsibility for their system error and total and complete disarray and put my rate back to what it should be 5.625 % Those internal errors should never be imposed on the client who in my case, is totally innocent. 
Attached are the Bank statement information for XXXX, XXXX, XXXX, and XXXX for XXXX XXXX XXXXXXXX Account -- Thank you, XXXX XXXX XXXX XXXXXXXX XXXX XXXX Phone XXXX Email XXXX XXXX

Company public response: Company believes complaint is the result of an isolated error
Company response to consumer: Closed with explanation