Consumer complaint received 2019-02-21
Company: Mr. Cooper Group Inc.
State: CA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Struggling to pay mortgage

Complaint:
Hello, we have big problem again, there is a foreclosure sale scheduled for our home on XX/XX/XXXX and we are out of options and we have exhausted ourselves with this horrible company. We have had many attempts to receive an affordable monthly payment but no resolution and no affordable monthly payment offer has been given. We have sent in a request for mortgage assistance form along with bank statements taxes paystubs and other documents necessary for a loan modification review. Mr. Cooper has received all the documents but the sale is still scheduled. 
As part of this bailout, on XX/XX/XXXX, the United States Government took over XXXX XXXX   and pumped billions, which in XX/XX/XXXX, then Treasury Secretary XXXX XXXX said as much as {$200.00} billion would be pumped into XXXX XXXX and XXXX XXXX, each, which was separate from the {$700.00} in TARP funds given out to other lenders. 

1. The guidelines issued by the United States Treasury set forth a detailed process whereby a participating servicer, either action or not acting through its subsidiary, must : a. identify loans that are subject to modification under the HAMP program, both through its own review and in response to requests for modification from individual homeowners ; b. collect financial and other personal information from the homeowners to evaluate whether the homeowner is eligible for a loan modification under HAMP ; c. institute a modified loan with a reduced payment amount as per a mandated formula, that is effective for a three-month trial period for borrowers that are eligible for a modification ; and d. provide a permanently modified loan to those homeowners who comply with the requirements during the trial period. Whether the homeowner qualifies for a modification or not, participating servicers are also required to provide written notices to every mortgage borrower that has been evaluated for a loan modification, whether or not the borrower has been found eligible. 


HAMP and its associated directives also set prohibitions against certain conduct including demanding upfront payments in order to be evaluated for a loan modification, instituting or continuing foreclosures while a borrower is being evaluated for a loan modification, assigning a single point of contact, maintaining an adequate level communication with borrowers, maintaining proper caseload to ensure HAMP objections are met, and restrictions on the way a servicer may report the borrower to credit reporting agencies. 

All servicers have systematically failed to comply with the terms of the HAMP directives and has regularly and repeatedly violated several of its prohibitions. Now that HAMP is over and expired due to servicers prolonging these modifications they are now proceeding with other alternatives. 
Under HAMP, the federal government incentivizes participating servicers to make adjustments to existing mortgage obligations in order to make the monthly payments more affordable. Servicers receive at least {$1000.00} for each HAMP modification. However, this incentive is countered by a number of financial factors that make it more profitable for a mortgage servicer avoid modification and to continue to keep a mortgage in a state of default or distress and to push loans toward foreclosure. This is especially true in cases where the mortgage is owned by a third-party investor and is merely serviced by the servicer. However, this incentive is countered by a number of financial factors that make it more profitable for a mortgage servicer such Mr. Cooper to avoid modification and to continue to keep a mortgage in a state of default or distress and to push loans toward foreclosure. This is especially true in cases where the mortgage is owned by a third-party investor and is merely serviced by Service companies because Service companies do not carry a significant risk of loss in the event of foreclosure. 

California Business and Professions Code 17200 et seq., also known as the California Unfair Competition Law ( UCL ), prohibits acts of unfair competition, including any unlawful, unfair, or deceptive business act or practice as well as unfair, deceptive, untrue or misleading advertising. Mr. Cooper and all other previous servicers and their Investors conduct was unlawful in that : They illegally began and prosecuted the non-judicial foreclosure based on the lien to the 1st Deed of Trust, despite i was not in breach of payments on said lien ; They engaged in the uniform practice of requesting unnecessary documentation, seeking repetitive submissions of the same documents, and never rendering a decision, and in doing so, such activity provides the basis for an unfair inquiry and could deceive the public because it places burdensome requirements on me that served no purpose but to provide a basis for either engaging in Dual Tracking by selling my home and by denying loss mitigation options, such as loan modifications ; They failed to properly consider loan modification applications before trying to sell my home. 

1. On information and belief, Mr. Cooper does not own a significant majority of the loans on which it functions as servicer. 

2. Economic Factors that discourage Mr. Cooper from meeting its obligations under HAMP by facilitating loan modifications include the following : a. Mr. Cooper may be required to repurchase loans from the investor in order to permanently modify the loan. This presents a substantial cost and loss of revenue that can be avoided by keeping the loan in a state of temporary modification or lingering default. 

b. The monthly service fee that Mr. Cooper, as the servicer, collects as to each loan it services in a pool of loans, is calculated as a fixed percentage of the unpaid principal balance of the loans in the pool. Consequently, the modifying of a loan to reduce the principal balance results in a lower monthly fee to the servicer. 


c. Fees that Mr. Cooper charges borrowers that are in default constitute a significant source of revenue to it. Aside from income Mr. Cooper directly receives, late fees and process management fees are often added to the principal loan amount thereby increasing the unpaid balance in a pool of loans and increasing the amount of the servicers monthly service fee. 

d. Entering into a permanent modification will often delay a servicers ability to recover advances it is required to make to investors of the unpaid principal and interest payment of a non-performing loan. The servicers right to recover expenses from an investor in a loan modification, rather than a foreclosure, is often less clear and less generous. 


e. Fixed overhead costs involved in successfully performing loan modifications involve up-front costs to the servicer for additional staffing, physical infrastructure, and expenses such as property valuation, credit reports and financing costs. 

XXXX. Rather than allocating adequate resources and working diligently to reduce the number of loans in danger of default by establishing permanent modifications, Mr. Cooper has serially strung out, delayed, and otherwise hindered the modification processes that it contractually undertook to facilitate when it accepted billions of dollars from the United States. Mr. Cooper delay and obstruction tactics have taken various forms with the common result that my loan serviced by Mr. Cooper, in which im eligible for permanent loan modifications, and have met the requirements for participation in HAMP,  have not received permanent loan modifications to which iam entitled. 

4. By failing to comply with the California Homeowner Bill of Rights ; specifically, by engaging in the unlawful practice of Dual Tracking, Mr. Cooper has left me in a state of despair and panic as I seek a loan modification from Mr. Cooper, only to have my home wrongfully, oppressively and illegally sold out from under my feet. 

We have been in a fighting battle with our bank/ servicer Mr. Cooper for a very long time I mean very long time. We have been trying for a loan mod. recently its getting worse and worse and the bank keep pressuring and not providing an affordable loan mod. that we can afford which will help us keep the home and not throw us out on the streets. So our servicer now is Mr. Cooper and we have sent them many times a request for mortgage assistance forms packet with all documents. Recently we mailed and faxed in a copy of the request for mortgage assistance and all required documentation to be reviewed for a loan modification. Mr. Cooper keeps prolonging this process. Mr Cooper now are saying that have all documents received for a review but they still have our home under a foreclosure sale and recently they said they put the sale on hold but different representatives keep telling us different information one says ins on hold the other says its still on sale but after reviewing and calling the trustee its still on for sale, seems to me some of the representatives are trying to manipulate and get me false information to think that everything is ok but its not according to the trustee nothing has been stopped or placed on hold. 
If Mr. Cooper proceeds to sell my home while having a complete request for loan modification review packet then they will be in violation of multiple laws including but not limited to my California Home Owner Bill of Rights Act Mr. Cooper has still placed my home on a foreclosure sale set for XX/XX/XXXX and has not CANCELLED the foreclosure sales until the review and an affordable loan modification and the process has been approved and agreed upon not some {$4000.00} monthly payment that no one can afford but one that is reasonable and that if helping the borrower not a ridiculous sum that will force us to move out. We sent them all documents and are in review at the moment but why have they not yet removed the foreclosure sale. 

Thank you.

Company response to consumer: Closed with explanation