Consumer complaint received 2019-07-26
Company: Flagstar Bank, N.A.
State: KS
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Trouble during payment process

Complaint:
I have our mortgage payment set up on auto payment. Our monthly payment due has been {$1400.00} ( escrow XXXX of said payment ), but we overpay a monthly rate of {$1600.00} ( an overpayment of {$190.00} ). On XX/XX/XXXX, Flagstar notified us, via voicemail, that the account was past due. 
Upon calling I learned the account was past due because Flagstar reviewed the escrow and raised it to {$660.00} claiming insurance rates were now {$4400.00} and taxes were {$3400.00} ( See attachment dated XX/XX/XXXX ). That insurance rate is more than double the previous years assessment at {$1800.00} ( see attachment dated XX/XX/XXXX ). The insurance rate was falsely and drastically inflated, and Flagstar could not provide any information regarding the reason for the inflation. 
This same exact issue happened to us in XXXX of XXXX! In XXXX they inflated insurance rates with no explanation and increased the payment ( see attachment dated XX/XX/XXXX ). After hours on the phone and submitting documents, they were able to input the correct numbers and restore the correct payment due of {$1400.00} ( attachment XX/XX/XXXX ). However, no one was ever able to provide documentation on why this happened. Flagstar did not follow up on the matter. 
Again, Flagstar requested I send in insurance documentation for review of the second error and then I was to call Flagstar back in 48 hours. On XX/XX/XXXX I called and spoke to two different departments ; neither had an explanation for the issue. However, they told me if the balance due wasnt paid by months end I would be reported to the credit bureau. So, we were required to send {$250.00} to Flagstar ( payment made online XX/XX/XXXX ) and they told us once the matter was resolved we would get the money back. However, they are not able to apply the money to our account so they will have to return via a check in the mail. Once again, time away from our jobs, hours on the phone, and money sent for Flagstars error. 
I expect this correction to be expedited. I also expect detailed documentation regarding how this incident has occurred not once, but twice in the last twelve months. I want to know why this presumably fraudulent activity happened and what is going to be done to ensure this does not happen again. I want our {$250.00} returned to us swiftly, and I want to ensure the {$190.00} of overpayment that was submitted on the recent payment was not misappropriated during the time that Flagstar made erroneous adjustments to the terms of our mortgage. 
I would hope that they would reexamine their customer service guidelines to remove the burden of follow up from their clients and accelerate the investigation process for obviously false claims that result in the damage of consumers credit history. 
We are concerned that this is happening to other consumers, some who may not be fortunate enough to catch it and Flagstar is  illegally collecting money from consumers.

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