Consumer complaint received 2015-07-25
Company: Arbor Residential Mortgage LLC
State: WA
Product: Mortgage
Sub-product: Conventional fixed mortgage
Issue: Loan servicing, payments, escrow account

Complaint:
Seneca Mortgage Servicing has been repeatedly using our principal reduction payments as future payments and taking the interest when all money should be applied to principal reduction. 

Our account has been notated to show that ALL ADDITIONAL funds received in excess of the required monthly payment are to go to principal reduction only. Each time I have to contact them to reverse their change to our account and have the money applied as principal reduction as directed. This happened in XXXX, XXXX, XXXX 2015. They appear to be trying to take the interest by posting the principal reductions as future payments and hope that I do n't catch them. 

On the attachment to this complaint : XXXX XXXX I made a {$2000.00} ( {$220.00} additional principal ) payment, then the next day I made a principal only payment of {$50000.00}. Seneca reversed the XXXX principal payment and tried to make it a future payment. I had to contact them to reverse their future payment and apply the full XXXX to principal reduction only. 

On XXXX XXXX I made a {$4500.00} payment. This was the XXXX payment ( {$1700.00} ) with an additional {$2700.00} principal reduction. Instead of applying the {$2700.00} as principal, Seneca applied it to the XXXX payment as well and attempted to take more interest. I had to contact them to reverse their future payment into a principal only payment and make the next payment due date to be in XXXX. 

On XXXX XXXX I made another principal only payment on their website for {$3100.00} and I planned to make the XXXX Payment in XXXX, as allowed per our contract. Seneca AGAIN REVERSED my XXXX XXXX principal only payment and applied it to the XXXX payment. Since it was close to XXXX I did n't bother contacting them to reverse it. On XXXX XXXX, instead of the planned XXXX payment, I went through Seneca 's website and made another {$2300.00} Principal Only payment ( I said {$0.00} for the regular payment and {$2300.00} as principal reduction only ). Then, on XXXX XXXX, without notice, Seneca reversed my XXXX XXXX, {$2300.00} principal only payment and applied it to the XXXX payment and took the interest, and made my next payment for XXXX. It is not yet XXXX, and they posted my XXXX XXXX Principal reduction only payment as a regular XXXX payment and took the interest. I contacted them again to reverse that and put it back into principal reduction only. I have not yet heard back from them. 

In addition to Seneca reversing my principal only payments, they are taking interest based on the amortization chart and not calculating the interest taken as simple interest, which is in violation of the mortgage contract. I am making large payments, yet they continue to charge interest in excess of what is due. 

My principal reduction payment is just that, PRINCIPAL REDUCTION. This has happened numerous times. I requested that they reverse the change and make it back to a principal reduction payment as I intended. 

Each and every time I submit principal reduction payments, they try to post them as regular payments and take the interest for the next month out. 

Seneca Mortgage Service is acting fraudulently in that they take the payment through their website as " principal reduction only, '' then later when the consumer " is n't looking '' reverse the principal reduction and make it a regular payment and take the interest. Please help me make it clear to Seneca that payments in excess of the regular payments are for PRINCIPAL REDUCTION ONLY. 
Thank you.

Company public response: Company chooses not to provide a public response
Company response to consumer: Closed with explanation