Consumer complaint received 2022-02-19
Product: Mortgage — FHA mortgage
Issue: Struggling to pay mortgage — 
Company: Flagstar Bank, N.A. (GA)

I was in a XXXX XXXX XXXX Program with my mortgage loan servicer, Flagstar Bank XXXX I was set to come out of it on XX/XX/XXXX. On XX/XX/XXXX, I contacted the loan servicer to see what my options were regarding my mortgage and a new repayment plan. I spoke to a woman and was advised ; I had an additional forbearance option available to me for 3 months even though I had received letters stating otherwise. I requested the additional forbearance extension. She submitted me for the extension. I was advised, I would be notified within XXXX days of XXXX decision for the extension. As of XX/XX/XXXX, I had not heard from Flagstar Bank regarding the forbearance extension. 

In the interim, I received, a letter indicating my forbearance was about to expire which totally countered what I was previously told. When I called back on XX/XX/XXXX regarding my extension, I was told by another rep that it was still under review. I was concerned and asked why it was taking so long as I was set to come out of my forbearance XX/XX/XXXX and that I was more than {$40000.00} in the arrears of my mortgage payments and was very concerned. The representative advised, investors had to review the request, etc. The representative advised me to follow-up, the following week. I called back on XX/XX/XXXX and was advised by a loss mitigation representative that I was given misinformation previously and that my loan would reset on XX/XX/XXXX. Furthermore, I was advised, that I was not eligible for another forbearance. Additionally, effective, XX/XX/XXXX, I would no longer have forbearance protection. I was told I could fill out a loss mitigation application, and I submitted my application via fax and certified mail on XX/XX/XXXX. Flagstar Bank, did not reply and confirm they received my loss mitigation application/package in a timely manner ( in 5 business days ). I never heard back within that time frame even though I have a successful fax transmission confirmation from XX/XX/XXXX? On XX/XX/XXXX, I received confirmation that Flagstar Bank was in possession of my paperwork but that my application was incomplete and that I needed to provide additional information and to return it by XX/XX/XXXX. They advised that I needed to supply them with the following : a 4506-TEZ for nonborrower contributor, bank statements for the most recent 60 days with my income circled, a financial breakdown for payment frequency, proof of other earned income, SS income, and proof of occupancy. I didn't understand what some of these meant? On XX/XX/XXXX, I received a follow up notice of an incomplete application from Flagstar Bank confirming they in-fact received additional information but that the application was still incomplete, Flagstar Bank never provided a clear explanation of what information was still needed following their XX/XX/XXXX follow up letter. As a result, I sent a certified letter on XX/XX/XXXX requesting clarification regarding the missing/incomplete information. 

On XX/XX/XXXX, they responded with what appears to be a form letter indicating that my application was still incomplete but without providing clarification of what was still missing or incomplete? They never answered my formal certified letter from the XXXX of XXXX asking for more clarification regarding what information was still outstanding? Previously, on XX/XX/XXXX, while in the middle of the loss mitigation process, Flagstar Bank sent a notice of default and their intent to accelerate their collection actions against me. On XX/XX/XXXX, I contacted XXXX XXXX, a HUD approved agency and asked them to sit-in on a conference call with me and the loan servicer, Flagstar Bank XXXX so that they could listen in to what the servicer was telling me and to try to get to the bottom of the outstanding issues? During that call, I spoke with two people from Flagstar Bank, XXXX from customer service and XXXX who was with the Loss Mitigation Dept. During the course of the conversation, I was told there were four additional pieces of information Flagstar Bank still needed in order to process my loss mitigation application. According to Flagstar Bank, they needed to have a 4506-TEZ for my sister who lives with me, 60 days of my most recent bank statements with my income circled, the financial breakdown form with pay frequency, and proof of occupancy for my sister. 

The letter never indicated the type ( XXXX ) of proof of occupancy documentation that would be acceptable? According to XXXX, the Flagstar Bank Loss Mitigation Representative, any official mail addressed to my sister with our address on it would be acceptable. He further advised to simply write on the mail addressed to my sister, " proof of occupancy '' to show the information being submitted was indeed documentation to show proof of occupancy. To ensure there would be no issues, I submitted a letter from the Georgia Dept of Family and Human Services sent to my sister on XX/XX/XXXX which was a recent piece of mail sent and addressed to my sister. 

On XX/XX/XXXX I uploaded the four pieces of documentation that according to Flagstar Bank, representative, XXXX was still missing and the reason for the incomplete application. I uploaded directly to Flagstar Bank XXXX XXXX ; the following : two XXXX XXXX signed forms, ( the first one had an error that needed correcting ), proof of occupancy which was a letter from the Georgia Department of Health and Human Services XXXX XXXX XX/XX/XXXX and addressed and sent to my XXXX live-in sister, 60 days of my most recent bank statements with income listed for both my sister and I from the Social Security Administration and my private XXXX insurer, XXXX circled per XXXX instruction on the financial breakdown page with pay frequency of once a month typed in. Although I uploaded this information directly to Flagstar Bank XXXX XXXX on XX/XX/XXXX and XX/XX/XXXX, my loss mitigation application was still rejected by Flagstar Bank. On XX/XX/XXXX, ( yesterday ) I received a letter dated, XX/XX/XXXX from Flagstar Bank, stating my loss mitigation application file was being closed because I did not submit the proper and missing and incomplete paperwork to them by the due date of XX/XX/XXXX. 

This is completely outrageous as I uploaded the outstanding items according to what their representative XXXX advised was missing by the due date of XX/XX/XXXX. I have done everything they have asked plus I have also requested for them to send me in writing what specifically they required, but they have refused to do so. I would like to note, a 4506-TEZ is an IRS form for a request of a tax transcript. 

My sister has never filed taxes and is XXXX XXXX XXXX  XXXX and does not have any tax transcripts. I informed Flagstar Bank of this fact, yet they still advised that we needed to provide the 4506 T-EZ form for her. I was also informed ( by XXXX, Flagstar Loss Mitigation Representative ) that they needed a utility bill or bank statement as an acceptable form of proof of occupancy for my sister. Why was this never conveyed to me by Flagstar Bank previously when I have been requesting clarification since XX/XX/XXXX? I would also like to note, that I have screenshots of my uploaded documents ( where applicable ) to them on both XX/XX/XXXX and XXXX. Since XX/XX/XXXX, I have sent Flagstar Bank over 70 pieces of documentation for my loss mitigation application, and yet my loss mitigation application has been denied and the file closed. When I called Flagstar Bank following the receipt of their XX/XX/XXXX letter regarding my closed loss mitigation application file and requested to speak with someone from the escalation department. I was told by XXXX in loss mitigation, that there was no one in escalations that I could speak with at the time and that he would have to request to have someone call me back later in the day. 

As of COB today, XX/XX/XXXX no one from their escalation department has returned my phone call to address my concerns or address my loss mitigation application? 

It is my contention and position that my rights have been violated under 12 CFR 1024.41 Loss mitigation procedure violations by Flagstar Bank. 

XXXX. Flagstar Bank ( aka, Loan Servicer ) failed to evaluate borrower for all loss mitigation options and failed to present option ( XXXX ) in conjunction with incomplete Loss Mitigation Application effective, XX/XX/XXXX. 

XXXX. Flagstar Bank failed to respond ( with clarification ) to XX/XX/XXXX letter from Borrower requesting clarification on incomplete and missing, loss mitigation application information. 

XXXX. Flagstar Bank failed to respond timely ( in 5 business days ) to receipt of initial Loss Mitigation Application faxed on XX/XX/XXXX. 

XXXX. Flagstar Bank has failed to acknowledge and/or verify receipt of new loss mitigation information sent by Borrower, oXXXX XX/XX/XXXX and XX/XX/XXXX XXXX. Flagstar Bank failed to provide Borrower with a list of acceptable forms of documentation in writing for proof of occupancy for either the Borrower or Non-Borrower Contributor. 

XXXX. Flagstar Bank failed to specify who they needed proof of occupancy for in their letter ( XXXX ) dated : XX/XX/XXXX, XX/XX/XXXX, and XX/XX/XXXX, titled : Notice of Incomplete Application and Follow-up Notice of Incomplete Application XXXX. Flagstar Bank has failed to provide Borrower with list of critical information still missing after receipt of uploaded documents on XX/XX/XXXX, and XX/XX/XXXX. 

XXXX. Flagstar Bank has improperly and erroneously closed Borrowers Loss Mitigation Application File, effective XX/XX/XXXX, denying her a fair, complete an impartial review of her loss mitigation application.