Consumer complaint received 2020-08-11
Company: Flagstar Bank, N.A.
State: CA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
Our home was sold and the closing date was XX/XX/XXXX. XXXX XXXX wired the {$370000.00} to Flagstar Bank the payoff our mortgage on XX/XX/XXXX. This was the payoff amount + five days of interest as a buffer which is XXXX 's policy. 

Around the same time, we discovered that we had neglected to cancel our mortgage auto payment of {$3000.00} and that payment was processed on XX/XX/XXXX by Flagstar Bank. 

On XX/XX/XXXX, we received a {$10.00} refund from Flagstar Bank. The memo said " Misapplication fee ''. I had been expecting a refund of the extra mortgage payment and our escrow balance, so logged into our mortgage account to see what was going on. 

I found the account still Active and NOT marked Closed/Paid in Full. I then saw that the funds sent by the title company were marked as " Held in Suspense ''. I saw other charges of {$10.00} ( document prep ), {$170.00} ( recording fee ), and {$30.00} ( fax/email fee ). 

I called XXXX on XX/XX/XXXX and spoke with a representative who told me that our loan was still active/open because " the wire was short and did not contain enough funds to close the loan ''. She said the wire was short by {$580.00} and asked if I would approve pulling those funds from our escrow to close the account. I said no. I said that the account should be overpaid because not only did XXXX overpay, but we accidentally paid our mortgage on XX/XX/XXXX. She then said that the {$3000.00} payment we sent was " applied to our XXXX mortgage payment '' which does not make sense. The Case # fir this call was XXXX, representative was XXXX in the XXXX XXXX. 

I then engaged XXXX who called Flagstar and worked with Lowanna in the Payoff Department and a new case was opened. XXXX XXXX said that XXXX agreed that there were sufficient funds to close the account and someone would be calling me. No one called. 

On XX/XX/XXXX, I called Flagstar again as I had not received any update. I was told by XXXX in the XXXX XXXX " Oh, you are going to be mad. The wire from XXXX actually bounced for insufficient funds on XX/XX/XXXX. We sent it back to them on XXXX. XXXX sent a brand new wire yesterday on XXXX at XXXX EST. '' Further, she said that the amount they received was {$370000.00} ( which underpaid the interest due by {$64.00} so XXXX took this from our escrow ) and say that the money XXXX sent to satisfy the loan took into account the extra payment {$3000.00} we made in error on XX/XX/XXXX. 

At this point, I called XXXX and they said that the wire never bounced and no additional wire was ever sent. They said they had the federal tracking # for the wire to prove it. They called Flagstar and conferenced me in and got yet another representative in the payoff department to admit that there was NOT in fact a second wire sent. She told us that the account was marked Paid in Full as of XX/XX/XXXX and confirmed that we were charged interest through XX/XX/XXXX even though they received our full payoff on XX/XX/XXXX. She said this matter was escalated to the " XXXX XXXX '' department and that I would get a call from them by XX/XX/XXXX. No one has called. When I called on Friday, XX/XX/XXXX, I was told there was no update. 

The issues : Flagstar Bank was overpaid by both XXXX XXXX and XXXX XX/XX/XXXX and did not apply ANY of the payments ( they were held in suspense ) until XX/XX/XXXX. They then closed the loan 2 weeks late and applied LESS than they were paid and the escrow balance DOES NOT reflect the overpayments. 

Charging interest from XXXX - XXXX is not appropriate. 

Representatives are fabricating stories about what happened and do not agree with each other. 

I was charged closing fees TWICE : on XX/XX/XXXX and again on XX/XX/XXXX -- these amounts are {$10.00} XXXX document prep ), {$170.00} XXXX recording fee ), and {$30.00} XXXX fax/email fee ) charged on XXXX and again on XXXX. 

Further, no one is calling me back. My escrow funds are due to me as today is the XXXX business day since we paid off the loan on XXXX. 

One last note, as we were going through the transactions, it became clear that XXXX was not applying our additional principal payment. We sent an extra {$30.00} every month and that money was never applied to principal. In fact, we do not see it being applied to the loan at all. Where did it go? 

XXXX XXXX XXXX

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