Consumer complaint received 2019-07-02
Company: RUSHMORE LOAN MANAGEMENT SERVICES LLC
State: TX
Product: Mortgage
Sub-product: FHA mortgage
Issue: Trouble during payment process

Complaint:
The following account details a series of events that has led to the cessation of my good standing with XXXX and XXXX XXXX as well as a significantly raised premium and subsequent higher monthly mortgage payments. The following details will show that these consequences are of no fault of my own and should therefore be remedied by the party at fault, Rushmore Loan Management Services, LLC. 

On XXXX of XXXX, Rushmore Loan Management bought our mortgage loan account from XXXX XXXX XXXX XXXX. The transfer of service went into effect on XX/XX/XXXX, which coincides with the date of our first payment to Rushmore Loan Management Services LLC. We then made timely payments in XXXX, XXXX, and XXXX of XXXX. On XX/XX/XXXX, we received notice from Rushmores Insurance Department that we needed to provide insurance information to Rushmore Loan Services. This was a surprise to me as their initial letter ( dated in XXXX of XXXX ) clearly states that the transfer that took place at that time does not affect any term or condition of the mortgage instruments presumably to include the previous ( and presumed current ) insurance arrangement. Upon further investigation, through calling both the servicing department and the insurance department, we found out that we no longer had home owner insurance at all and that we needed to provide proof of insurance immediately or be fined and then given a mandatory company issued insurance that would cost {$380.00} a year with far less coverage as well as additional penalties for the lapse in coverage. However, Rushmore Loan Management was responsible for issuing a check of {$800.00} for our XXXX insurance premium to XXXX XXXX XXXX XXXX on XX/XX/XXXX and failed to do so, resulting in the lapse of homeowners insurance. After further investigation, it was found that Rushmores Insurance department never received information on our account until XX/XX/XXXX, more than 3 months after they were supposed to have received notice from their servicing department. Timely communication between departments would have indicated that I was a current account with Rushmore Loans but because of their tardiness and miscommunication within the company, the insurance department was unable to issue the check to XXXX XXXX XXXX XXXX resulting in the lapse of our homeowners insurance. After multiple phone conversations back and forth with Rushmores servicing department, insurance department, and XXXX XXXX XXXX XXXX company, it was found that our homeowner insurance had lapsed in XX/XX/XXXX and our home was uninsured for the following five months until the insurance department at XXXX got notice of our account and flagged that we were without insurance. Because of this five-month lapse and failed payment in XXXX of XXXX we had to become new customers with our insurance company, losing all previous discounts that we had acquired over our loyal five-year relationship with them prior to this mistake. The result of this is that our premium was raised from {$800.00} a year to {$1700.00} a year. 

I made several phone calls to your servicing department and spoke with various employees and supervisors in an attempt to remedy this mistake. Rushmore Loan accepted responsibility for this mistake and we were told that the difference in premium amounts would be reimbursed to us and any and all penalties applied before then or to follow would be waived and reimbursed as well. It was to my understanding that on XX/XX/XXXX that all had been taken care of and was in a completed status. In XXXX of XXXX I spoke with your servicing department to follow up on the activity on my account and was walked through the numbers on the account and made to believe that it had been remedied but was still in the process of being completed and that a supervisor would contact me to further discuss the transactions. I continued to make payments over the next few months and assumed my account was up to date because I had not received any other letters indicating otherwise and the few phone calls that I made in an attempt to follow up reassured me that everything had been rectified. I received another letter on XX/XX/XXXX indicating that I still needed to provide proof of insurance and when I called to follow up, I was again reassured that it was a mistake, and all had been taken care of and my account was in good standing. Each of these calls were made on a recorded line from your company and with notes from the caller that you can refer to for assistance. 

On XX/XX/XXXX, I logged into Rushmore Loans to make my monthly payment and found that my regular monthly payment had risen by {$120.00}. When I called to inquire what was going on and why my payment had risen I was told that there was an escrow analysis done on my account and my insurance premium had risen from the year before and therefore my monthly payments rose too. I was on my way out the door to catch a plane out of the country for the next nine days and informed the person I spoke with that I would handle it when I got home because it was apparent that my insurance problem had not been fixed and I was being made to pay for the mistakes of Rushmore Loan Services.

Company response to consumer: Closed with explanation