Consumer complaint received 2022-03-18
Company: Flagstar Bank, N.A.
State: TN
Product: Mortgage
Sub-product: VA mortgage
Issue: Trouble during payment process

Complaint:
My husband lost his job in XX/XX/XXXX. We took advantage of Flagstar Bank 's COVID assistance which put off our payments until he could get another job. My husband got a job in XX/XX/XXXX and we returned to making our payments in XX/XX/XXXX. So we did not make payments for 4 months. My husband spoke to Flagstar each month and reported he was still unemployed but looking and once he regained employment, he informed them. They told him to do a XXXX XXXX which would add the missed payments to the end of the loan. He agreed which lowered our loan from {$2100.00} to {$1700.00} and some change a month. We have paid {$1700.00} something each month starting in XXXX. In XX/XX/XXXX, they sent us loan modification papers to sign and return. We took those papers to our bank to have them notarized and sealed, which we did. We have a copy of those documents. We returned those documents. But we continued to receive letters each week saying we were in default and phone calls saying there was an urgent matter and we needed to call back. But when my husband called back, the customer service individual would not know why we called. We do this bi weekly pretty much since sending back the loan modification papers in XX/XX/XXXX. We have an email from XX/XX/XXXX ) with the loan modification papers, promissory note, and partial claims mortgage papers ( all papers dated XX/XX/XXXX ) showing that our loan was modified and that we have a partial claim mortgage for {$8700.00} and have until XX/XX/XXXX to pay the partial claim mortgage and our loan modification agreement ( deed of trust ) states starting XX/XX/XXXX, our loan interest is 3.3750 % and we promise to pay {$1300.00} beginning XX/XX/XXXX, which we have. And it states our loan will be paid off in full XX/XX/XXXX. Each time my husband has called for the last 3 MONTHS, each person he speaks to tells him it's " TAKING LONGER THAN USUAL '' to process our paperwork/loan modification. He was told day before yesterday XX/XX/XXXX, that they didn't know why it was taking so long to process but they would " ESCALATE '' the paperwork up and to call back next week. Yesterday we received papers of NOTICE OF DEFAULT AND INTENT TO ACCELERATE saying if we don't pay {$12000.00} by XX/XX/XXXX, they are foreclosing on our house. This is an over charge by {$3700.00} more than the promissory note from XX/XX/XXXX shows. The letter I received yesterday states we are in default {$12000.00} but our loan modification/promissary note shows {$8700.00}. We have made each payment since XX/XX/XXXX at the agreed upon rate and can pull bank documents to reflect this. The excuse we get when we ask about the confutation of letters each week and phone calls is they can not turn off these items within the organization. They can stop reporting to the credit bureau but they can not turn off the option to stop these demanding letters and proceedings due to their negligence of approving the paperwork within the 30 day requirement by the CFPB per the XXXX verdict for violating mortgage servicing rules. They have returned to their XXXX and years prior techniques of telling the customer to continue to wait, it's taking longer than normal, until they can foreclose on the home. Per the CFPB enforcement action of XXXX, " Flagstar is prohibited from engaging in violations of the loss mitigation provisions of the CFPBs mortgage servicing rules and unfair, deceptive and abusive acts or practices in connection with loss mitigation. Among other things, this means Flagstar must properly review, acknowledge, and evaluate loss mitigation applications and can not improperly deny loss mitigation applications or improperly prolong the trial period for a loan modification. '' Flagstar is improperly prolonging the trial period for a loan modification as we have been working on this since the end of XXXX XXXX of XX/XX/XXXX. That's 75 DAYS .... 75 DAYS and they told us to wait another week. That's over the new CFPB mortgage servicing rules that Flagstar must evaluate a complete loss mitigation application within 30 days, if it receives the complete application more than 37 days before a foreclosure sale. Why is Flagstar taking so long to complete the process/application and now wanting to foreclose on my home when we have been trying to get the paperwork and resolve the issue since XX/XX/XXXX? This is ridiculous. They are trying to foreclose on homes so they can make ridiculous amounts of money in the over inflated housing market we have today. They are not following CFPB rules and prolonging applications/processing/completion in order to foreclose on homes. They are taking advantage of individuals, especially retired military/veterans who lost jobs due to COVID for their own monetary gains. I would be more than happy to provide the promissory note, loan modification, and partial mortgage claim as well as bank documents reflecting payments.

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