Consumer complaint received 2021-10-05
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — 
Company: PLAZA HOME MORTGAGE, INC. (VA)

Plaza Home Mortgage , Inc. sold our home mortgage to XXXX XXXX in XX/XX/2021 and neither mortgage service provided notification that the loan was being sold. We continued to make payments to Plaza Home Mortgage by automatic bank draft in XXXX, XXXX, XXXX, XXXX and XXXX XXXX XXXX. On or about XX/XX/XXXX we received a notice from XXXX XXXX that our mortgage payments were past due and owed them approximately {$9000.00} in past due mortgage payments. Thinking it was a scam, I called XXXX XXXX to inquire why they were falsely stating that we owed them past due mortgage payments when our mortgage was provided by Plaza Home Mortgage. I declined to provide my social security number over the phone with XXXX, thinking it was a scam and they recommended that I contact Plaza Home Mortgage. 

When I called Plaza Home Mortgage they informed me over the phone that they sold the mortgage to XXXX in XXXX and that payments we made in XXXX and XXXX were forwarded to the new mortgage servicer ( XXXX ). I asked Plaza Home Mortgage why I was not provided the opportunity to consent to the sale of the mortgage or even notified of it and they stated that I should have been notified. I was not! 

I then called XXXX back and informed them that I had just called Plaza Home Mortgage where they informed me over the phone that they sold the mortgage to XXXX in XX/XX/2021. I provided XXXX with my social security number and they were able to provide me the details of the mortgage and stated that they received forwarded payments from Plaza Home Mortgage for XXXX and XXXX, both 20+ days late, but had not received payment for XXXX or XXXX with a balance due of nearly {$7000.00} and a late payment applied to our account of around {$130.00}. We reconciled the balance due over the phone by ACH transfer immediately and XXXX agreed to waive the {$130.00} late payment fee and informed us that no adverse action would be taken with the credit reporting agencies ( XXXX XXXX, XXXX, XXXX ). On or about XX/XX/XXXX my wife and I both received alerts of changes to our credit score with over a 100 point drop in our credit score. After getting a copy of our credit reports from annualcreditreport.com ( referred by the Federal Trade Commission website ) it was discovered that XXXX had reported us as past due and in default of our mortgage. 

We contacted XXXXXXXX XXXX  and inquired about the adverse credit reporting when they assured us that would not happen upon reconciling the account on XX/XX/XXXX. Both my wife and I ( separately ) had to file complaints and disputes of the adverse credit reporting with XXXX. We also requested proof of all payments, forwarded payments and notifications from Plaza Home Mortgage. 

This could take 30-60 days to be reconciled and it remains uncertain whether our credit history and credit score ( >835 ) will be restored and untarnished by the time this is all resolved. 

It is apparent that the financial institutions do not prioritize the well-being of their customers over their own financial interests and the lax consumer protection laws facilitate this behavior without any accountability on lenders to protect the consumer. I have since learned that consent is not required for a mortgage to be transferred between mortgage service providers, and the weak requirements for non-specific notification without any checks and balances for validation provision of that notification to prevent consumers from suffering significant adverse consequences to their credit ratings and history. This can ripple into employment consequences, security consequences ( e.g. security clearances ) and financial health to consumers on which the financial institutions reap their profits. 

" Consumers should not be collateral damage in the mortgage servicing transfer process, '' said Consumer Financial Protection Bureau Director XXXX XXXX. 

This is clearly not operating in practice as intended. And it is happening too frequently for the CFPB to ignore. Just google it. The experience that my wife and I are enduring is not a rare case- it appears to have become the rule rather than the exception.