Consumer complaint received 2015-10-29
Product: Mortgage — FHA mortgage
Issue: Loan servicing, payments, escrow account — 
Company: BANK OF AMERICA, NATIONAL ASSOCIATION (ME)

My issue deals with my mortgage company and flood insurance that has been deducted from my escrow without notice or authorization by me. 
1. My complaint involves mortgage company paying for flood insurance for my property for the last two years without my approval or without providing me notice. 
2. My mortgage company paid my insurance agency {$410.00} in XX/XX/XXXX and {$630.00} in XX/XX/XXXX even though my property is not in a flood zone and I cancelled my coverage in XXXX XX/XX/XXXX directly with my insurance agency. 
3. My problem involves both the insurance agency and my mortgage company, neither is moving to resolve the issue. 
This issue began in XXXX XX/XX/XXXX, when I received notice from the mortgage company that FEMA had designated that my home was in a flood area and that I needed to obtain flood insurance within 60 days. The problem begins when I asked if this could be an escrow item and was told no, that I would need to pay for this myself. So, I did ; after several attempts and threats that they would send me a bill {$1000.00} due immediately for insurance they obtained ( a copy of the letter attached ). I was able to meet all their requirements by paying for a policy through my insurance agent. 
In XXXX XX/XX/XXXX, FEMA deemed that I did not need flood insurance, so the mortgage company sent me a notice of that, and then informed me I would have to cancel the policy, since I 'd obtained it independent of them. I provided my insurance agency with these documents. The insurance agency told me that I needed to sign to remove and that, if there was one, a refund would be sent to me. They also made it clear that I should not pay any further bills from them upon renewal. 
I heard nothing further about this issue until XXXX XX/XX/XXXX. At that time, I learned, through a notice that my escrow analysis revealed that my mortgage would increase, partly due to flood insurance. I was surprised for XXXX reasons : ( 1 ) I never had flood insurance through my escrow ( as the mortgage company made it clear that was n't an option ) ; and 2. My flood insurance had been cancelled a year ago. 
Through further analysis, I found that my mortgage company had paid my insurance company using my escrow funds for flood insurance {$410.00} in XX/XX/XXXX and {$630.00} in XX/XX/XXXX -- neither time did I receive any notice of the payment from either party. I contacted the mortgage company and provided all the documentation, stating that this was an error. 
Since XXXX XX/XX/XXXX I have been trying to get this resolved and have my mortgage re-analyze and lowered ; it is not happening. Their response was to ( 1 ) reinvestigate whether I was in a flood zone and send me a notice saying I no longer need flood insurance ; ( 2 ) require me to sign a document cancelling flood insurance with them so they can remove it from my mortgage ; ( 3 ) they ca n't refund me until they receive the refund from the insurance agency. 
My issue is ( 1 ) I paid my flood insurance directly to my agent ; it was not an escrow item ; ( 2 ) I cancelled this insurance following their notice that I did not need flood insurance in XX/XX/XXXX and finally, ( 3 ) how can they just pay for something without my authorization. 
I asked for clarity as to why this was paid in the first place since they notified ME that I no longer needed the flood insurance and they were the ones who told me I needed to pay for it directly or be subject to a high bill that would be due immediately. I provided the letter from XXXX. The mortgage company stated that the letter I received in XX/XX/XXXX was not well written, that all it required from me was to choose a carrier and that flood insurance is " automatically '' an escrow item. 
I stated the letter clearly says I must get the insurance : their response is that flood insurance was an automatic item and that, although I paid it the first time, subsequent bills were paid in accordance to their guidelines.