Consumer complaint received 2023-12-07
Company: Ocwen Financial Corporation
State: PA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process
Sub-issue: Payment process

Complaint:
Like many others in XXXX, due to XXXX, as a XXXX  mother, I was forced to resign from my job and stay at home with my children due to their school shutting down and only doing remote schooling. My children were in XXXX XXXX and I had no other options. I applied for and was granted a Forbearance through PHH Mortgage Company and I was told once I was able to return to work, I should then contact them and a Modification for my mortgage would be made. I was assured my credit would remain in good standing and all would be ok. Immediately upon returning to work at the end of XX/XX/XXXX, I contacted PHH Mortgage and requested to start this process. At that time, I even requested to begin to make payments to my mortgage and I was told " NO '' as it would have a negative impact on my credit score. The process of having a Modification in place would take weeks and weeks. Once the modification was approved, my mortgage was now a 40 year loan and I was verbally told on the phone that I could make " extra payments to my principal so I would not have a 40 year loan and pay it off sooner '' and was told this was encouraged and I would not be penalized. As a general rule of thumb, this is what I have always chose to do. As I began to get back on my feet, I was able to make extra payments to the principal of my loan in XX/XX/XXXX through the end of the year. I made sure to send in a paper check with my payment coupon, with my written request of how much was to be applied to an extra principal payment. The next statement from PHH mortgage confirmed the extra principal payment was applied. In XXXX, I had an estimated $ XXXX extra applied to my principal, but a closer review of my records the following year, showed me that PHH Mortgage did not in fact apply those payments to the principal as I requested. At the end of the year, PHH Mortgage took those funds and applied them to outstanding late charges, other fees, etc. due to the forbearance and modification loan. I received documentation from them recently as I questioned this again when I did a Re-Fi and was basically told they could do this, even though the paperwork I have states part of the Payment deferral agreement/ modification / forbearance plan was to adjust the due dates to bring the mortgage current ( hence why this did not impact the credit scores ), defer the repayment and past due amounts ( I was told my missed payments would be added to the tail end of my mortgage ), and waive any late charges required. My escrow payments were increased to make up for that loss. And I was never, ever once contacted by PHH Mortgage and told by them that they were going to change where my requested monies would be applied too. I have other loans that I could have been paying down the principal, and that was my goal. Instead, PHH Mortgage just rerouted my money to suit them and profit over fees they told me I wouldn't even be subjected to and had me pay extra interest on a loan, when the principal should have been lower all along. This is just for XXXX, I haven't even looked at XXXX yet.

Company response to consumer: Closed with explanation