Consumer complaint received 2020-07-10
Company: Shellpoint Partners, LLC
State: GA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
XX/XX/XXXX To whom it may concern and advocate for senior citizens who are being taken advantage of : I am a XXXX XXXX XXXX with modest financial ability who has a mortgage servicer in Shellpoint who is violating the Homeowners Protection Act ( HPA ) and XXXX XXXX own guidelines as they relate to the termination of Private Mortgage Insurance ( PMI ). My loan was originated by XXXX XXXX in XXXX of XXXX and subsequently sold to XXXX XXXX with the servicing rights to Shellpoint. The appraised value of my home at origination was {$130000.00}. The current unpaid principal balance of my loan is approximately {$97000.00} for a current loan-to-value ratio ( LTV ) of approximately 74 %. Please note, these numbers are my best guess because I cant locate my original appraisal my LTV could be lower if the appraised value at origination was higher. Also, my loan is a conventional 30-year loan, single family residence, my principal residence, and I have never been 30 days delinquent on my mortgage payment. As an individual who has worked for over 50 years, Im planning to XXXX  soon and need every dollar possible. In an effort to maximize my fixed income for XXXX  purposes, I requested PMI to be terminate by Shellpoint on XX/XX/XXXX through a call with customer service. I paid an additional {$4700.00} to principal XXXX to ensure I was below the LTV threshold only to be denied by Shellpoint. 

On XX/XX/XXXX, Shellpoint sent me a denial letter for my request to terminate PMI. Shellpoint stated I have not meet XXXX XXXX requirements to lift PMI because my LTV was not 70 %. Shellpoint is violating the HPA by requiring I pay down my mortgage balance to 70 % of its original value again, this is a single-family home and my principal residence. 

HPA 4902 ( b ) states, ( b ) Automatic termination A requirement for private mortgage insurance in connection with a residential mortgage transaction shall terminate with respect to payments for that mortgage insurance made by the mortgagor -- ( 1 ) on the termination date if, on that date, the mortgagor is current on the payments required by the terms of the residential mortgage transaction ; or ( 2 ) if the mortgagor is not current on the termination date, on the first day of the first month beginning after the date that the mortgagor becomes current on the payments required by the terms of the residential mortgage transaction. 
4901 ( 18 ) states ( 18 ) Termination date means -- ( A ) with respect to a fixed rate mortgage, the date on which the principal balance of the mortgage, based solely on the initial amortization schedule for that mortgage, and irrespective of the outstanding balance for that mortgage on that date, is first scheduled to reach 78 percent of the original value of the property securing the loan. 

Not only did Shellpoint error and deny my request for PMI termination, they told me to remove it I needed to PAYOFF my loan, see attached denial letter. Based on the LTV, Shellpoint should have removed my PMI automatically, I should not have even needed to request PMI to be removed. I find Shellpoints response UNFAIR and ABUSIVE by telling me I need to payoff my loan. The HPA gives homeowners like me protections from these abusive practices. Is XXXX XXXX and /or Shellpoint sending denial letters like this to all senior citizens because our income is not likely to increase and they want to ensure theyre protected from potential loss if a foreclosure where to occur? This practice is predatory and violates any concept of Fair Mortgage Loan Servicing rules. 
Finally, Shellpoint is clearly violating XXXX XXXX Servicing Guide as it relates to termination. XXXX XXXX Servicing Guide, section B-8.1-04 states that PMI should automatically terminate for my single-family primary residence at 80 % LTV. Clearly, Im well below this requirement.

I am requesting the assistance of this regulator for two purposes. First, I would like my PMI terminated. Second, in accordance with HPA 4902 ( f ), I want a refund of all PMI premiums that I overpaid based on XXXX XXXX guideline of 80 % LTV. 
Also, I believe it would behoove the regulator to investigate the Fair Servicing practices of Shellpoint to determine if these unfair and abusive practices ( requiring I payoff my loan to get PMI removed ) and clear violations of HPA are targeted to senior citizens, a protected class of individuals. Also, has XXXX XXXX instructed its servicer to delay removing PMI in violation of HPA and its own Servicing Guide because Im a XXXX XXXX with limited income and they want to protect themselves from financial loss in the event of a foreclosure? 

Attached is the relevant sections of the HPA and XXXX XXXX Servicing Guide, and my denial letter from Shellpoint. Thank you for your assistance. 

Sincerely, XXXX XXXX

Company public response: Company believes the complaint is the result of a misunderstanding
Company response to consumer: Closed with explanation