Consumer complaint received 2019-11-12
Company: Freedom Mortgage Company
State: PA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
In XX/XX/2019, I was informed that my escrow account had a shortage just under {$900.00}. I called Freedom Mortgage and informed them that the shortage amount was incorrect due to an inaccuracy in my school district residence tax. The shortage should have been around {$750.00}. I had a pleasant experience with the customer service representative, who asked me to submit for a new escrow analysis in writing. I did this on XX/XX/2019. 

I was required to submit the shortage amount before the end of XXXX. I had not heard from the company before calling on or around XX/XX/2019. It was at that time that I was informed an additional escrow analysis could not be performed because it was under the companys required difference amount of {$250.00}. I was quite frustrated with this case, and let my displeasure be known. Afterward, on or around XX/XX/2019, I paid the full escrow shortage of approximately {$900.00}. 

In the meantime, I was looking to refinance with another company. On XX/XX/2019, I called Freedom Mortgage to see if my escrow account could be dropped. I was sick of dealing with shortages and terrible customer service, and wanted to settle taxes and insurance on my own. I was informed that in order for the account to be dropped, I would need to have no liens on the property, have good payment history for 12 months, have a mortgage that is over 2 years old, and also have 80 % loan to value based on the original sales price ( not appraisal value ) of the house. 

Upon hanging up, I talked to a trusted mortgage broker who told me this practice was unlawful. I immediately called Freedom Mortgage back and informed them of such. The tune very quickly changed with this customer service representative who told me she was unaware of the 80 % LTV practice and that the only stipulations were to have no liens, have good payment history for 12 months, and have a mortgage that is over 2 years old. Since I met these requirements, she suggested I submit in writing to the company my request for removal from an escrow account service. I sent an email to this effect on XX/XX/2019. 

Additionally, during this second phone call, I was informed that a second escrow analysis was conducted in XXXX, which resulted in the lowering of a monthly payment by approximately {$10.00} and also reimbursement of approximately {$170.00} from the overage escrow payment in the amount of approximately {$900.00} from XXXX. 

On XX/XX/2019, I was informed that the stipulations are as follows : would need to have no liens on the property, have good payment history for 12 months, have a mortgage that is over 2 years old, and also have 80 % loan to value based on the original appraisal value of the house. The company would not honor a reappraisal of the property. 

I firmly believe this practice is predatory and requires consumers to have funds in escrow much longer than what they should be, since the appraised value of a home will generally increase over time. To not honor a reappraisal is poor business practice, which only benefits the business and not the consumer.

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation