Consumer complaint received 2024-10-07
Product: Credit reporting or other personal consumer reports — Credit reporting
Issue: Problem with a company's investigation into an existing problem — Their investigation did not fix an error on your report
Company: Onity Group Inc. (PR)

I am filing this complaint regarding a late payment reported by PHH Mortgage Servicing for my mortgage account. The late payment was inaccurately reported to the credit bureaus due to communication failures, misleading information in PHHs online system, and a lack of timely notifications on their part. Below is a detailed timeline and explanation of the issue : Timeline of Events : XX/XX/XXXX : A scheduled auto-payment for my mortgage was rejected due to an issue with my bank. PHH Mortgage Servicing subsequently canceled my auto-payment without notifying me via my preferred methods of email or secure message, despite my account being set up to receive such alerts. 

XX/XX/XXXX : PHH attempted a second auto-payment, which was incorrectly displayed as successful in the PHH payment history portal. Only after reviewing a different screen did I realize the payment had been returned. This misleading information delayed my ability to resolve the issue. 

XX/XX/XXXX : I received a mailed notification from PHH about the auto-payment cancellation and missed payment. This was the first communication I received, and it arrived nearly two months after the payment issue occurred, despite my notification preferences being set to email. 

XX/XX/XXXX : I contacted PHH Mortgage Servicing 's Research Department to request the removal of the negative credit reporting, explaining the lack of timely notification and the misleading information provided by their online portal. 

XX/XX/XXXX : PHH denied my request, citing their obligation under the Fair Credit Reporting Act ( FCRA ) to report accurate information. They provided instructions for resubmitting documentation to further investigate the issue. 

XX/XX/XXXX : I resubmitted my request the same day, including proof of my email notification settings and a copy of my credit report showing the late payment. 
Key Issues with PHH Mortgage Servicing : Failure to Notify via Preferred Method : PHH Mortgage Servicing failed to notify me via my preferred communication method ( email ) regarding the cancellation of my auto-payment. I did not receive any email or secure message, even though my account settings were configured to receive such notifications. The only notification was sent via U.S. mail, arriving on XX/XX/XXXX, well after the payment had already been marked late. 

This failure to provide timely notification violated the Real Estate Settlement Procedures Act ( RESPA ), which requires mortgage servicers to inform borrowers of significant account changes in a timely and clear manner. 
Misleading Online Interface : The PHH Mortgage Servicing payment portal incorrectly showed that a second payment attempt on XX/XX/XXXX was successful, which further delayed my awareness of any issue. It was only upon accessing a different screen that I discovered the payment had been returned. This misleading information from PHHs system directly caused a delay in rectifying the payment issue. 

This failure to provide accurate and transparent information violates both RESPA and PHHs obligation under the Fair Credit Reporting Act ( FCRA ) to report complete and accurate information about a borrowers payment status. 

Good Faith Effort to Resolve : Once I became aware of the issue during a routine account login for an unrelated matter, I immediately made a payment in full, including late fees, to bring the account current. This demonstrates my commitment to resolving the issue promptly, even though it was caused by PHHs failures in communication and their user interface. 

PHHs Claim of " Accurate Information '' under FCRA : While PHH Mortgage Servicing has claimed that they are contractually obligated to report accurate information to the credit bureaus under the FCRA, I believe that this reporting is incomplete and misleading due to the following : Lack of Timely Notification : PHHs failure to notify me via my preferred method of communication directly contributed to the late payment. The delayed U.S. mail notification, which arrived after XX/XX/XXXX, does not fulfill PHHs obligations under RESPA for timely and effective communication.

Misleading Payment Portal : The payment history interface on PHHs online portal showed the XX/XX/XXXX payment as successful when, in fact, it was returned. This misrepresentation caused further delays in my ability to resolve the payment issue. The inaccurate reporting of my payment status in their system ultimately led to an incorrect reflection of my payment history on my credit report. 

Incomplete Reporting under FCRA : While the late payment may be technically accurate in terms of date, the context surrounding itPHHs notification and interface failuresmeans that the negative reporting is misleading and incomplete. FCRA requires that the information reported to credit bureaus be not just accurate in terms of dates but also fair and representative of the borrowers situation. In this case, PHHs reporting is not a fair reflection of my payment history, given their role in causing the delay. 

Legal Violations : Fair Credit Reporting Act ( FCRA ) : PHH Mortgage Servicing is required to report complete and accurate information to credit bureaus. The failure to notify me in a timely manner and misleading payment interface has resulted in incomplete and unfair reporting.

Real Estate Settlement Procedures Act ( RESPA ) : PHH was obligated to provide timely and clear communication regarding the cancellation of my auto-payment and the returned payment. Their failure to do so has caused unnecessary damage to my credit report. 

Puerto Rico Consumer Protection Law ( XXXX XXXX XXXX XXXX XXXX XXXX XXXX ) : As a resident of Puerto Rico, I am also protected under local consumer protection laws, which ensure companies like PHH treat consumers fairly. Their failure to notify me properly and provide accurate information violates these protections. 

Puerto Rico Law 138 of 1998 ( XXXX XXXX XXXX XXXX XXXX  ) : PHHs misleading online portal and lack of proper notification may also violate this law, which requires companies to provide accurate and fair information to consumers. 

Desired Resolution : I am requesting that PHH Mortgage Servicing remove the late payment reporting from my credit history, as it is the result of their system and notification failures, not due to any negligence on my part. I have acted in good faith to resolve the issue once it became apparent, and the current reporting is unfair and incomplete. 

I look forward to a prompt resolution of this matter.