Consumer complaint received 2021-03-30
Company: SELECT PORTFOLIO SERVICING, INC.
State: GA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
We are sending this correspondence because we would like to report the mortgage servicing company Select Portfolio Servicing , Inc. ( SPS hereafter ) for unethical mortgage servicing practices and XXXX for unethical lending practices. We are requesting that these practices become illegal in the state of Georgia. 
Around XX/XX/XXXX we refinanced our home with XXXX XXXX ( XXXX ). It was a financial decision because we needed to update our kitchen. At the time we had XXXX small children and were pregnant with our XXXX. My XXXX was difficult and in hindsight probably not the best time to make a large financial decision. Nevertheless, we were contacted by XXXX and told that the basic terms of the refinancing would be the same as our current mortgage. The mortgage would increase by approximately {$200.00}, but the interest rate and escrow account would remain the same. We agreed to the terms we were quoted and went into the office in XXXX ( with IV drip in tow ) to sign the paperwork. After a few weeks, we were notified that the escrow account had not paid the homeowners insurance and that XXXX would place insurance on our home. We ( XXXX ) went to the office where we had signed only to find that the office was closed and no one could talk to us about our mortgage. 
Shortly after this happened, we had financial difficulties because I was out of work due to my difficult XXXX and my husband was unemployed. We applied for and received a loan modification. Our loan payment dropped from {$1300.00} to {$1200.00} ( not significantly ). We made the payments on time each month. Not long after that our loan was sold to XXXX Homes and we continued to make our monthly payments on time. In XXXX of XXXX our loan was again sold. This time to XXXX XXXX XXXX XXXX XXXX XXXX and was to be serviced by SPS. We were NOT contacted by either XXXX XXXX XXXX XXXX XXXX XXXX or SPS. We only learned of the sell because our automatic payment was not taken out on XXXX XX/XX/XXXX. We had made our payments on time through automatic draft for over eight years. We called XXXX to find out why the payment was not taken out only to be told that the loan had been sold. We were given SPSs contact information. We contacted SPS and were told that they were the servicing agent and would contact us regarding how and when payment would be made. In XXXX we received the information regarding making payment. We made the 1st payment to SPS in XX/XX/XXXX via telephone. At that time we requested the paperwork necessary to resume automatic draft. We completed and submitted the paperwork and assumed the automatic draft would begin XX/XX/XXXX. It did not. We called SPS to ask why and if they needed any other documentation only to be told that we could not do auto draft because our account was delinquent. We questioned how our account could be delinquent when we had made the 1st payment within a few days of receiving the 1st statement. Their explanation was that we had missed the XXXX payment. We argued that we did not miss the payment because they had not sent us information in a timely manner and only sent information AFTER we contacted them. If we had a missed payment, it was due to their negligence in providing us with the proper information. There was no reasoning with them. They proceeded to charge us a late fee every month thereafter even though we made our payment EVERY month on or around the 1st. That is every month from XX/XX/XXXX until the present. 
A few months after SPS began servicing the loan we submitted information on the internet to explore refinancing with a different company. We received a call from SPS telling us that we didnt qualify to refinance. In hindsight we should have known that they did not have to power to tell us we could not refinance, but at the time we were just discouraged. In XX/XX/XXXX, we decided to move forward with refinancing. We contacted XXXX XXXX and proceeded with the refinancing process. We were initially approved. Unfortunately, we were not able to refinance because when they performed the appraisal the house appraised for $ XXXX and the remaining mortgage on the house ( at that time ) was approximately $ XXXX. Needless to say this was discouraging. We moved into our house XX/XX/XXXX. We paid $ XXXX. We refinanced in XX/XX/XXXX for $ XXXX. After years of making payments to know that our principal did not decrease was heartbreaking. 
We continued making our payments until we received a letter from SPS stating that our payment was going to increase from {$1200.00} to {$1900.00} and that our interest rate had increased to 11.96 %. Not only did they give us this new payment, but they refused to tell us any other information about this new arrangement. We asked how many months were we expected to make this payment ( i.e., the remaining length of the mortgage ). They would not give us an answer. We continued making our regular payment while trying to get more information and negotiate with SPS. Surely, it was not reasonable to expect someone to pay 11.96 % interest on a home loan and not even give a last payment month and year. We made several efforts to contact SPS and negotiate. Finally, in XX/XX/XXXX we ceased making payments. Again, hindsight is XX/XX/XXXX. At the time we were at our whits end and felt like we were making payments only for SPS to still foreclose on our home. We had a personal tragedy in XX/XX/XXXX and did not make any contact until XXXX XX/XX/XXXX. We sent a letter to SPS with proposed payment and interest rate ( see attachment ). 
After several attempts to reach a mutually beneficial agreement, we were ready to through in the towel. We received a letter from SPS asking that we make three consecutive payments of {$1600.00} so that we could then get the newly negotiated terms of our loan. We asked specifically what the interest rate would be and the length of the loan. We were told that could not be determined until after we made the three payments. So XXXX, XXXX, and XXXX of XXXX we made the payments. After making the XXXX payment, we started asking for the information again. After XXXX, we received a letter dated XXXX XX/XX/XXXX. 
This is what SPS proposed : Months : XXXX Interest Rate : 8.265 % Interest Rate change date : N/A Monthly principal and interest Payment Amount : {$1200.00} Estimated monthly escrow Payment Amount : {$390.00} ( which may adjust periodically ) Total Monthly payment : {$1600.00} ( which may adjust periodically ) Payment begins on : XX/XX/XXXX Number of payments : XXXX A final balloon payment on the Interest Bearing Principal Balance of {$100000.00} is due on the Maturity Date. 

They actually proposed a 30 year mortgage with an 8.265 % interest rate. That is preposterous. 30 additional years would mean that we would have made payments on a house for 45 years. However, to add insult to injury, SPS went further and added a balloon payment of {$100000.00} to the end of the loan. I am guessing that this is legal behavior, but I am proposing that it should NOT be. There should be some consumer protections in the law against this type of lending and servicing. 
We called again SPS and asked if this proposal was really what they intended. When we spoke to Mr. XXXX ( Relationship Manager for our account ), his response was, I wouldnt agree to that. Let me check into it. '' We continued to send emails as a follow up with no response. Finally, our last conversation with Mr. XXXX, was that he understood why we would not want to agree with this, but his investors would not be willing to change any part of the proposal. I was flabbergasted. He really had the audacity to speak to people that have paid for a home for over 15 years about his investors! This home is our investment. We purchased this home in good faith thinking that we would raise our family and retire living in this same home. Instead we have been swindled by a system that perpetuates the inequities of our culture. I do not know if this is racism or classism, but it is certainly an ism. This proposal is likened unto the historical idea of sharecropping. Keep paying for something, but never really owning it. There is no way for me to know how many families have faced financial ruin and housing insecurity because of SPS ( acting on behalf of XXXX XXXX XXXX XXXX XXXX XXXX ) and/or other companies that engage in this practice. 
It might be too late for us to save our home from these vultures, but I pray that as a legislator you will investigate and introduce legislation that will make this practice illegal in the state of Georgia. If you perform a simple XXXX search of SPS, you will see thousands of hits that reiterate the same basic complaints. Our credit is ruined and we face homelessness all while working full time because these companies are allowed to operate unregulated. 
I implore you to please consider following up. There is nothing more we can do. We are not people that want something for nothing. We did not buy a house that we could not afford. We are not deadbeats or shiftless. We want to remain in our home and pay a fair and reasonable rate for our loan. The proposal from SPS is neither fair nor reasonable. 

Thank you for your consideration,

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation