Consumer complaint received 2021-01-22
Company: Flagstar Bank, N.A.
State: CA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
My mortgage is serviced through Flagstar Bank in Michigan. They purchased the loan from another lender, so they are not the loan originator. I have my escrow account with them so that they can pay my property taxes and homeowner 's insurance. In early XXXX, 2020, I reached out to them about obtaining a payoff quote. When I called they noted this was not something that could be e-mail. They needed to mail it to me. I agreed. I was not advised of anything further. I received the letter with the payoff quote and on the back of the letter, there is a paragraph noting that requesting a payoff will put a stop on my account. What is not made clear is the stop time. 1 day? 3 days? 1 week? 1 month? Longer? My property taxes were due by XX/XX/2020. I happened to login to my account on XX/XX/2020 and realized my property taxes were not showing as paid. I contact the county and they noted they did not receive any payment. I reached out to XXXX and they noted there was a freeze on my account due to the payoff request made in early XXXX, 2020. The county would not waiver on the late payment and I was required to pay a penalty of {$440.00}. I then reached out to XXXX and requested that they reimburse me for the penalties I had to pay. After several weeks and many calls to their customer service department, I was contacted by XXXX XXXX who noted that due to the holidays, people were out of the office and he requested that I allow him until after the XXXX XXXX to get back to me, but he assured me this would be taken care of. I was contacted by XXXX XXXX after the XXXX XXXX and he assured me that his team was looking into the matter and would get the matter resolved. He then provided additional contact information for others at XXXX who would be more qualified to address my situation. I reached out to them without reply. I then received an e-mail from XXXX XXXX noting she would get me a reimbursement check via XXXX. However, once I provided proof that I had paid the property taxes with the penalty, XXXX changed their mind and noted that they could reimburse me from my own escrow account, but would not reimburse the funds through the bank, despite their error. I have always had sufficient funds in the account to address the property taxes. At one point, when I had called to follow up, I was asked 'did you call us and tell us to pay your property taxes? ' I noted I had not and in my many years of having a mortgage, I have never been required to remind my own bank to pay the taxes out of my escrow account. I have contacted numerous individuals at the bank and requested a denial letter in writing indicating why they will not reimburse me. I have yet to receive a valid response. I was advised that I can file a complaint here, but no resolution was offered by XXXX beyond paying me back with my own money. 
I also specifically asked them not to reimburse me out of my escrow funds, but they issued a payment nevertheless.

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