Consumer complaint received 2022-08-24
Product: Mortgage — FHA mortgage
Issue: Struggling to pay mortgage — 
Company: Flagstar Bank, N.A. (GA)

I have an FHA mortgage loan with Flagstar Bank. Due to Covid 19 my husband 's income and hours were drastically reduced and this made it difficult to keep up with our mortgage payments. We contacted Flagstar and asked them for help and they said there was nothing they could do, we needed to make sure we did not fall more than 30 days behind and they referred us to an XXXX number for a loan crisis counselor at HUD. We called them several times over a few months as we struggled to see if they would offer us a chance for the CARES forbearance plan which is supposed to be available for all FHA borrowers who are affected by Covid but they continued to say there was nothing they could do and referred us to XXXX number counselor. I have a good job as a dialysis technician and now my husband 's work is busy again and he is making his regular salary. We contacted Flagstar to try and make a mortgage payment but now they refuse to accept it and told us that we are going into foreclosure and that they will only accept the full past due amount along with late fees and legal fees which is almost {$9000.00}. This is an avoidable foreclosure, we are now making much more income and if Flagstar would work with us and offer a repayment plan or a modification or partial claim to pay off the late payments we would be fine but instead they have shut the door on us. I thought Flagstar was required to offer us the CARES forbearance since we have FHA loan and to assess us for all types of programs including modification, partial claim or repayment plan based on the current income?? 

My husband I bought our home in XXXX with an FHA loan that has been serviced by Flagstar Bank since the beginning. In XXXX my husband was injured on the job ( he is a XXXX XXXX but is a XXXX not employee ) and out of work for almost 5 months -- he did not get workers comp or XXXX  and did not get any insurance payout -- - we lost his income completely. We then applied for a loan modification and were approved. We were grateful for the help and the payment was affordable based on our income at that time. 

A few months after receiving the modification my husband 's income dropped significantly. He pulled his trucking loads from the dock and due to the supply chain issues from Covid there were few to no loads available. Even though I still had my job as a dialysis technician it was not enough and we were struggling. We called Flagstar several times and as I explained they told me there was nothing they could do to help, we just needed to make sure we were not more than 30 days late. We continued with payments as long as we could until it was not possible and we defaulted on our modification. We continued to call Flagstar frequently for help and were brushed off and told to call a HUD counselor at an XXXX number without any offer of direct help. Why were we not offered the CARES act forebearance? Isn't Flagstar required to offer that to all customers negatively impacted by Covid, even if they had a modification previously???? 

We slowly rebuilt and we tried to make a payment to Flagstar but their agents refused to accept it and now we are being told we are going into foreclosure. My husband is working full time again and we are doing much better financially and there has got to be a way to fix this. However, Flagstar refuses to consider any option other than paying back the full {$9000.00} delinquency in one payment which is not possible. Why are we not being considered for a repayment plan, we make quite a bit more money and can afford to pay extra on top of our old payment to pay off the late amount over time. Why won't Flagstar consider this, or a modification, or restructure of the loan or a partial claim of the late amount? This is an avoidable foreclosure, this loan is insured by the government, why is Flagstar Bank ignoring this and pushing us into foreclosure?