Consumer complaint received 2017-06-26
Product: Mortgage — FHA mortgage
Issue: Struggling to pay mortgage — 
Company: Alabama Housing Finance Authority (WA)

The Notice of Default was issued in error. Please see timeline below : 1. Notice of Pre-Foreclosure Options Letter ( sent out by the lender ) datedXX/XX/XXXX borrowers requested the meet & confer via letter dated XX/XX/XXXX 2. Email XX/XX/XXXX from Lender to Attorney that the borrowers requested a meet and confer a. Response from Attorney to Lender requesting approval of fees in the amount of {$350.00} to prepare and attend the meeting 3. Email XX/XX/XXXX from Lender to Attorney needs a few explanations/clarification but based on financials, borrowers will qualify for a 5 month repayment plan 4. Meet & confer held via phoneXX/XX/XXXX, additional documents/clarifications were needed. Email from attorneys office listed it as a mediation meet and confer. Under the Washington State Foreclosure Fairness Act, there is no such thing as a mediation meet and confer. These are two separate meetings. 5. On XX/XX/XXXXborrowers submitted the missing documents/clarifications to lender and previous housing counselor per the meet and confer 6. Notice of Default issued datedXX/XX/XXXX the box checked on the Foreclosure Loss Mitigation Form was that the borrowers DID NOT request a meeting per the above, that is incorrect. 7. Mediation was requested on XX/XX/XXXX per the issuance of the Notice of Default 8. It is our understanding that per RCW 61.24.031 under 1 ( c ) Section IV 90 days AFTER the date of the Notice of Pre-Foreclosure Options Letter is when a Notice of Default can be issued, which means the earliest the Notice of Default could have been issued would have beenXX/XX/XXXX. The Notice of Default was issued prematurely and therefore there should be no fees. There was a review/decision made back on XX/XX/XXXX pending additional documents. Our understanding of the CFPB guidelines is that the lender can not move forward with the foreclosure if there is a pending review. 9. EmailXX/XX/XXXX from borrower that she had called in the payment for {$2900.00} and was told she needed to pay {$3100.00} to cover part of the lawyer fees this contradicts the repayment plan. a. EmailXX/XX/XXXX to attorney asking to advise why the borrowers are being charged for attorney fees b. EmailXX/XX/XXXX from attorney stating that if they had a meet and confer then they were in the beginning of foreclosure. So I suspect there are some fees. c. Responded back that there should not have been any attorney fees was a meet and confer per the Notice of Pre-Foreclosure Options Letter that was sent out by the lender. 10. Email receivedXX/XX/XXXX from Attorney office that borrowers were approved for a repayment plan ( letter dated XX/XX/XXXX ) and the first payment had been made wanted to know if we wanted to stay in mediation through the plan. Advised we want to stay in mediation to address the request at the meet and confer for attorney fees to be paid by the borrowers. 11. The borrower called in to make the first payment onXX/XX/XXXX, lender took payment of {$3000.00} which violates the repayment plan. Per the plan, the payment was supposed to be {$3000.00}.