Consumer complaint received 2020-06-01
Company: RUSHMORE LOAN MANAGEMENT SERVICES LLC
State: OH
Product: Mortgage
Sub-product: FHA mortgage
Issue: Struggling to pay mortgage

Complaint:
I have a FHA loan and the servicer is Rushmore Loan Management. My home was involved in a natural disaster ( tornado ) on XX/XX/2019. The morning after, I called the loan company to advise. Because we had some other unfortunate events, our homeowners insurance had dropped us and we were looking for another insurance. So we had forced placed insurance with XXXX XXXX XXXX. About a week later XXXX XXXX sent an adjuster to the home who felt the home could be repaired. Shortly after XXXX XXXX sent {$83000.00} as an insurance payment. The least expense quote we received to fix the home was {$300000.00}. We had a two story home over 3,000 sq ft and the tornado took off the entire top story and the home is now full of mold. Needless to say, a year later and the home is not fixed and Rushmore has the insurance money in escrow. 
We never dealt with a natural disaster and did not know you could appeal the insurance amount. Before the tornado, our house payments were current. Rushmore failed to explain any home retention programs, including offering a short sale. 

I have also recently been made aware of the FHA 203 H loan program for MI  Insurance for Natural Disaster Victims that would allow for people who lost their homes due to a tornado to reconstruct their home or purchase a new home. 
Rushmore failed to advise that this was an option to save my home and rebuild. 

I have been approved for the FHA 203 H program and want to rebuild my home, but when I call the servicer NO ONE can help. I have been transferred to the insurance department. The insurance department transfers me to customer service. Customer service transfers me to the insurance department, and my home I am trying to rebuild on is in the process of a foreclosure sale, date pending. 

I need to know how can I rebuild my home using a 203 h loan when the current fha loan is in the process of being foreclosed on? 

Make matters worse, the principal balance is around {$96000.00}, the coverage XXXX XXXX XXXX  was covered for, was {$97000.00}. The insurance deducted depreciation of {$10000.00}, and they are foreclosing on ME when the LENDER placed the insurance on the property. Instead of using the funds received, going after the insurance company and deeding the property to me ( the $ XXXX is way more than what they would get in a short sale ), they are spending over {$20000.00} to foreclose. 

When my home was damaged, due to the extensive damages and we were in the home, we got a lot of news coverage. We live in a predominately XXXX  community, and when you look at my community, there is still a lot of rebuilding to do. However when you go to the more affluent and predominantly XXXX  community, it does not look like there was ever a tornado. 

Rushmore sent me a letter and it stated that they wanted to help me save my home, and would consider deeding the property to me. When I called them, they told me that the letter is only to get me to call in, and that they are foreclosing on the property. Dealing with the tornado and mental issues behind it, that was cruel. 

I have tried with the mortgage servicer, HUD, the insurance company, and all I want to do is have them apply the money they have, deed me the property and allow me to rebuild but they want to foreclose when they have more than enough and the loan is insured. I feel like Rushmore should be fighting with XXXX XXXX because the lender placed the insurance and XXXX XXXX did not pay out enough. 

At this point, I have written this letter and sent it to CFPB, HUD, Rushmore, and my local news stations. It has been a year later, and I do feel like if my home was located in a different location, not majority XXXX, I would not be having these issues. I will be contacting the media to bring awareness, I am sure there are many more going thru my situation in my part of town, and consider litigation as I feel this is discrimination how they are treating people in my city vs predominately XXXX  areas.

Company response to consumer: Closed with explanation