Consumer complaint received 2019-01-04
Company: SELECT PORTFOLIO SERVICING, INC.
State: NY
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage

Complaint:
Select Portfolio Servicing ( SPS ) was th managing my mortgage for a rental property. In XX/XX/XXXX I initiated the process to refinance this mortgage with XXXX XXXX. SPS was consistently non-responsive, uncooperative, and ultimately impacted me financially as I had to pay thousands of dollars in fees due to their inaction. 

Below is a detailed letter of what transpired : Through this letter, I would like to initiate a complaint against Select Portfolio Servicing ( SPS ) and request compensation for the mishandling of my investment propertys refinance. 
On XX/XX/XXXX I initiated the refinance process with XXXX XXXX. At the onset, I was advised that New York requires a Consolidation, Extension, and Modification Agreement ( CEMA ) for the refinance process. The intent of the CEMA is to save customers thousands of dollars in taxes as consumers would only have to pay taxes on the amount of the new loan that is above and beyond their current unpaid principal balance. I was also given the disclosure that there would be a chance that the previous lender would not have the CEMA which would then require me to pay the mortgage recording tax on the full amount of the property. 
I understood the terms provided and proceeded with the refinance. My rate lock was set to expire on XX/XX/XXXX, nearly 4 months after I started the process. Eager to move ahead, I submitted all requested documentation to the new lender, XXXX XXXX so I could refinance and realize a savings of {$440.00} per month. XXXX XXXX informed me that I had submitted everything necessary and that now we would just need to wait for SPS to respond. 
Over the next few months, I followed up with XXXX XXXX and they advised that they had not heard back from SPS. When XXXX rolled around, XXXX called me and asked that I reach out directly to SPS since their own efforts were futile. When I spoke to the attorney for XXXX, XXXX XXXX, she told me she had left countless messages for SPS but never received a tangible response, just the run around. I called SPS and explained the situation but was unsatisfied with the lack of clarity I received regarding the CEMA. I even told the individual I spoke to just tell me that if they dont have the CEMA, so I could just proceed with my refinance and recognize my savings instead of continuing to wait. The representative could not provide me with a definitive answer. Frustrated, I then wrote a complaint to the Ombudsman which seemed to influence some movement ( see attached ). 
Two weeks later, the attorney for XXXX notified me that she was finally able to get in touch with SPS and was speaking to their attorney. I was extremely anxious as my rate lock was going to be expiring soon and if SPS was able to provide the CEMA, I would save {$8100.00} in the mortgage recording tax. I had little confidence in SPS pulling through given the lack of accountability and responsibility they demonstrated over the last several months. 
The paralegal for SPSs attorney then notified me that there was a {$1000.00} fee for requesting the CEMA. I asked what the likelihood was of obtaining the CEMA given the questionable track record of SPS previously. This was the only time the actual attorney for SPS responded and provided his assurances that they their office has had success with XXXX XXXX on similar transactions/requests ( see attached email ). In all other interactions ( before this and after ), only the paralegal had responded. 
Based on the attorneys response, I decided to move forward with the CEMA as the benefit of having this documentation would again save me over {$8000.00}. I knew I was running out of time given my rate lock was expiring on XX/XX/XXXX. So, on XX/XX/XXXX once I received the attorneys assurances, I left everything at work in the middle of an audit, to obtain a bank check and drop it off in person to the attorneys office. I did everything possible to get this payment for the CEMA so I could proceed with this refinance and avoid any potential additional fees for a rate lock extension. 
I continued to follow-up to check on the status. Both XXXX XXXX and XXXX ( the title company ) were on the same page in terms of what additional information was needed from SPS. Their requests to SPS were simple but the back and forth continued. Ultimately, I had to extend my rate lock. I again took a leap of faith into SPS pulling through because the attorney for SPS gave me his assurances, both XXXX XXXX and XXXX believed it was possible to obtain the necessary updates, and I as the consumer did not want to pay {$8000.00} if I didnt have to! 
Unfortunately, the attorneys office for SPS insisted they could not do what was being requested even though attorneys from both XXXX XXXX and XXXX insisted that what they were asking was common and very simple to complete. The attorneys office for SPS just deflected the requests and were being uncooperative. At this point I made the decision to forgo the CEMA.

I already had a 4-month rate lock and having to go beyond that was unheard of as stated by XXXX XXXX. Each time I extended my rate lock, I would incur a fee of {$560.00}, but the extension was only good for 15 days. Therefore, I had to rely on SPS coming through quickly which is something that I couldnt do any longer given their behavior thus far. Both XXXX XXXX and XXXX expressed to me that they have never encountered anything like this before and were in disbelief about the entire situation. 
As an informed consumer and as a veteran 15-year  professional in XXXX XXXX, I am outright appalled and baffled by SPS and their lack of accountability to their customers. Quite frankly, I am not sure how they are even still in business. After the financial crisis in XX/XX/XXXX, shouldnt mortgage companies be more organized, responsive and work with consumers, instead of against them? 
I hold SPS 100 % accountable for this unnecessary stressful and financially taxing ordeal. Again, I understood from the very beginning that if they didnt have the CEMA, I would have to pay the taxes on the entire amount. However, they could have responded much sooner, provided accurate information, and per XXXX XXXX and XXXX they could have provided the documentation necessary for the CEMA. Though I finally refinanced my property on XX/XX/XXXX, I feel that SPS took multiple missteps with this refinance and that I should be made whole for the following fees : {$8100.00} : The mortgage recording tax I had to pay because SPS would not comply with the requests of XXXX XXXX and XXXX for the CEMA documentation. 
{$1300.00} ( XXXX*3months ) : Potential savings that would have recognized if my refinance had gone through in a normal amount of time, within 2 months instead of almost 5. 
{$1000.00} : Cost of requesting the CEMA. 
{$1100.00} : Rate lock extension fees. 
{$210.00} : Appraisal recertification fee incurred due to rate lock extension. 
Additional compensation for the stress, aggravation, and mental duress this situation caused to me and my family. 
As the regulatory body who governs mortgages, I hope you take my concerns seriously and look further into the day to day operations of Select Portfolio Servicing. Given my experience, I am not sure how they can compliantly remain in business. 
Should you need any more information about this transaction, please let me know.

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