Consumer complaint received 2017-02-16
Company: PNC Bank N.A.
State: FL
Product: Mortgage
Sub-product: Conventional fixed mortgage
Issue: Loan servicing, payments, escrow account

Complaint:
Beginning XX/XX/XXXX, PNC erroneously purchased multiple forced placed insurance policies, which have since been acknowledged by PNC as errors in a letter dated XX/XX/XXXX. The diversion of funds for insurance caused a cascade effect of shortfalls and penalties as a result of the original errors. PNC has not yet fully refunded these amounts or accounted for the incorrect accounting that ensued. 

I claim ; 1. As agreed in a PNC letter dated XX/XX/XXXX, PNC credited principal for {$810.00} but has since reversed that transaction without explanation and has failed to correct this after being informed. 
2. The methodology of issuing dollar for dollar refunds many years later is mathematically flawed, resulting in an overstatement of principal balance and excessive interest charges to the borrower over the life of loan. 
3. The accounting reports provided by PNC are obtuse, confusing and poorly documented to the point of being impossible to independently audit. The outstanding balance does not agree with a simplified amortization that eliminates all the superfluous transactions. 
4. Since XX/XX/XXXX, borrower has fully complied with the mortgage agreement to the extent possible given the errors and misinformation by PNC and that a recomputation of payments since that time, eliminating all erroneous information, applying mortgage payments solely to principal and interest, shows that the outstanding balance of the loan is overstated by {$2600.00} as of XX/XX/XXXX. 
5. PNC has breeched our contract by incorrect application of funds as stated in paragraph 2 of the Mortgage Agreement and failing or refusing to correct these errors that have been brought to their attention in five different RSPA Qualified Written Requests since XX/XX/XXXX. 
6. Borrower has incurred substantial costs and time to discover and bring these errors to the attention of PNC and is entitled to compensation as allowed by RSPA regulations. 

As a starting point, as of XX/XX/XXXX the outstanding balance of the loan is stated by PNC to be {$150000.00} and I agree with that amount. I claim that since that date, there are no valid cause for funds to be applied to anything but interest and principal and that a simple reconstruction of the monthly payment transactions since that date ( to principal and interest ) is all that is necessary to establish the correct outstanding balance. ( See attached spreadsheet ) As of XX/XX/XXXX the PNC stated balance is {$10000.00}, however a simple amortization of transactions since XX/XX/XXXX with all PNC errors and subsequent corrections eliminated, produces an outstanding balance of {$8000.00} ; an overstatement of outstanding balance by PNC of {$2600.00}. 

The exact cause of this discrepancy is impossible to pinpoint, due to the numerous undocumented transactions in the PNC loan accounting. However, the concept of refunding fees at a later date, after subsequent principal/interest calculations have occurred, is a fundamentally flawed accounting method that results in the overstatement of outstanding balance, inflating all subsequent interest calculations. Although seemingly small, the miscalculations are compounded and passed along to each subsequent mortgage payment, resulting in significant interest overpayments by the borrower throughout the life of the loan. 

I request PNC to state any and all valid charges that have occurred since XX/XX/XXXX which are not a consequence of errors by PNC and if there are none, as I maintain, then PNC should accept my amortization calculations and reduce the outstanding balance by an amount of {$2600.00}. I also request compensation for time and costs I have incurred, by an amount to be determined.

Company response to consumer: Closed