Consumer complaint received 2023-09-15
Company: Mr. Cooper Group Inc.
State: WA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process
Sub-issue: Escrow, taxes, or insurance

Complaint:
On XX/XX/XXXX, FEMA updated their flood maps and placed our house halfway in a flood zone, and halfway out of a flood zone. In XXXX of XXXX, or mortgage was sold to Mr. Cooper aka Nationstar Mortage. On XX/XX/XXXX, I received a letter from Mr. Cooper stating " we reviewed your account and after conducting an investigation determined that we did not make an error and the flood zone designation is appropriate according to the information provided by FEMA. According to their information the mortgaged property resides in an active flood zone. Therefore, flood insurance is required. '' After receiving this letter, we purchased flood insurance through XXXX, policy number XXXX. I uploaded the flood policy to Mr. Cooper 's website to show that we had purchased it, and never got a response back from Mr. Cooper. After three weeks, I called Mr. Cooper to verify that they had received the documentation as I didn't want to be penalized. When I called, I was told by two to three people ( Mr. Cooper has it documented as two, I remember three ) that we did not need flood insurance and they didn't know why that letter was sent out to us stating that we did. I stated I did not want to cancel our flood insurance policy until I had physical documentation from Mr. Cooper stating that we didn't need it since they previously said we did. 

Mr. Cooper sent out a physical letter to me dated XX/XX/XXXXXXXX  that states, " Effective XX/XX/XXXX, Mr. Cooper has removed the flood insurance requirement for the above loan. '' Upon receiving this letter, I cancelled the flood insurance through XXXX since Mr. Cooper said it was no longer needed, and because we were within our 30 day cancellation window with XXXX meaning the policy would not go into effect until 30 days had passed and we were able to get our money back. 

Fast forward to yesterday, XX/XX/XXXX, I received a letter from Mr. Cooper dated XX/XX/XXXX stating that our home is now located in a flood zone and we are required to purchase flood insurance. This came as a shock after going through this entire thing with Mr. Cooper just a year earlier. FEMA 's flood mapping hasn't been changed since XX/XX/XXXX, so there is no reason we should now be required to purchase flood insurance when Mr. Cooper themselves said we didn't need it AFTER FEMA updated their maps. 

I called and spoke with XXXX XXXX yesterday ( XX/XX/XXXXXXXX  ) with Mr. Cooper. His direct line is XXXX. He is the manager for the Mr. Cooper Insurance Center. He stated he did not know why we were told by Mr. Cooper that we didn't need flood insurance. He also stated that the company Mr. Cooper uses to verify whether a mortgaged property needs flood insurance has remained the same from XXXX to XXXX. This means that the information they provided to Mr. Cooper has been the same all three years, and should be consistent. However, the information Mr. Cooper has given to us has been INCONSISTENT and false as they are stating our now our home was never taken out of a special flood hazard area. 

Upon calling XXXX today ( XX/XX/XXXXXXXX ) to get a new policy written up for flood insurance, we found out that the premium we had the first time we contacted them about a flood insurance policy went from {$380.00} a year with a coverage of {$250000.00} and a {$2000.00} deductible, to {$1100.00} a year ( with the same coverage and deductible ). This is a {$790.00} a year price difference. XXXX said the prices are set by FEMA, and because we went without flood insurance when we previously had it ( however we cancelled it within the allowed 30 day window and it never went into effect ), FEMA was now requiring us to pay more. 

I am frustrated and upset by the massive mistake Mr. Cooper has made. We have no control over who our mortgage is sold to, and we have to trust that the information they give us is correct because it's THEIR company. As a consumer, I have no way to verify if what they are telling me is true and correct, I just have to assume it is. And because of this, they have failed myself and my family three times now. This time, it's a huge financial hit, creating a hardship for us, especially because I am a stay at home mom to our XXXX XXXX  children and don't bring in an income. Mr. Cooper is also only giving us 45 days to purchase this insurance, so we are suppose to come up with {$1100.00} in less then two months. To put such a massive mistake on your customer who has no way to verify if what they are being told is correct is just wrong, and I have saved all the documentation I received from them showing their egregious mistake. Mr. Cooper needs to make this right, and should be doing everything in their power to correct this. The financial hardship they have created should absolutely not be falling on us, and they are the ones who created it. 

Our loan maturity date is XXXX/XXXX/XXXX. So we have 27 years left on our mortgage. We purchased flood insurance since Mr. Cooper told us we had to in XXXX of XXXX  with a premium of {$380.00} a year. Once they told us they no longer required us to have it in XX/XX/XXXX, we cancelled it. Then upon finding out yesterday ( XX/XX/XXXX ) that they are asking us to purchase it AGAIN, the premium is now {$1100.00} ( price set by FEMA ). This is an additional {$21000.00} we could have to pay over the life of the loan ( an additional {$790.00} a year ) due to Mr. Cooper 's mistake. This is absolutely unacceptable, and I fully expect them to correct their error and make this right. We aren't talking about a small amount of money, and I do not take this lightly.

Company response to consumer: Closed with explanation