Consumer complaint received 2020-03-03
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — 
Company: SELECT PORTFOLIO SERVICING, INC. (TX)

My previous mortgage was with XXXX XXXX and I had zero issues over 9 years. The mortgage was sold by XXXX XXXX  to SP Servicing, XXXX XXXX XXXX, UT. My first payment with SP Serving was XX/XX/2020 in the amount of {$930.00}. I electronically wired {$940.00} for the mortgage. In addition I sent a separate amount of {$170.00} clearly earmarked for the principle of the loan. I called prior to XX/XX/2020 to get a feel for the company and also to insure that if I sent principle payments that the amount would be applied directly to my principle. I was assured that it would. I called SP Servicing to inquire, because XXXX XXXX  allowed for you to go directly to the site and make a payment at no charge to you. I could on line and pay my mortgage and I could also apply money directly to the principle. This is a practice I did throughout the 9 years I was with XXXX XXXX. However, I noticed that SP Servicing charged you a {$15.00} fee to make an online payment directly on their site. I was not going to do that so I sent my payments directly to SP Servicing from my bank and I wanted to make sure that the payments would be applied appropriately. Hence why I called them and they assured me the payments would be applied appropriately. 

I checked my account after my XX/XX/2020 payment posted and after my separate principle payment cleared. They did not apply my principle payment to the loan and not only did they not apply my principle payment to the loan they applied my whole mortgage payment plus {$14.00} of the money earmarked for principle to interest. The only money applied to the principle from both transactions was {$150.00}. I called and questioned this. The employees at this company tried to state that it was because I had a " daily interest '' accrue and they will pay the interest before the principle. I responded to them that I understand how interest is accrued, but they should only take the interest from my monthly payment versus my principle payments. Further I stated that not all of my monthly payment will go to interest. I stated " this is not an interest only loan ''. There is a reason that when I started with the loan 9 years ago at $ XXXX that the principle is now at $ 75,000+, but in  reality should be $ 74,000+. I could not get these morons to understand this. When I contacted the " ombudsmen '' of the company they stated " you do realize you have a daily interest accrual ''. And again ... I explained how mortgage payments and principles payments work. The ombudsmen office acted as if they finally understood and they stated they put in a request to have the account fixed. However, I sent yet another principle payment in the amount of {$340.00} electronically from my bank to SP Servicing on XX/XX/2020 and they did the same thing again. They applied the money to interest and only {$150.00} to the principle. Now out of {$520.00} directly paid to principle they have only credited {$310.00} to it. In addition I have been charged {$1000.00} of interest with 2 weeks. Keep in mind my monthly payment is only {$930.00}. So I called the Ombudsman again and tried to talk slowly. I asked them does anything jump out at you? I asked them to look at my monthly payment in the amount of {$930.00}. They acknowledged it. I then asked them to look at what has been applied to interest just in the past 2 weeks. I asked them if they realize that they are charging me in interest more than what my monthly payment is. I said ... .even though I have a " daily interest '' accrual when I make my monthly payment you should be taking it out of there and even then it won't be the full payment! I stated to them that I don't even have to make principle payments and if I didn't they would only have the monthly payment to take the interest from. I asked again slowly ... .do you understand now? Again I state that not only are they not crediting the principle I have paid directly they have literally took my whole mortgage payment and applied the full payment to interest less the {$120.00} they have taken for insurance. This company is either grossly incompetent in basic accounting practices or fraudulent to its core. At this rate I will never pay this loan off. I reached out again today to the " ombudsmen '' who stated " this should '' get fixed within 7 days. I asked them if every time I make a principle payment if this will happen and they said they weren't sure. I asked them to also put a note on my account that not only must they fix my direct principle payments they need to apply my principle payment from my mortgage payment as well. What is scary to me is they do not give a breakdown of exactly how your monthly payment is applied. They just put a chunk to " interest and mortgage '' so there is no way to track how my payments are being applied. I will attach all written communication to this company and attachments to date.