Consumer complaint received 2024-07-11
Product: Mortgage — VA mortgage
Issue: Trouble during payment process — Trying to communicate with the company to fix an issue while managing or servicing your loan
Company: PENNYMAC LOAN SERVICES, LLC. (LA)

On XX/XX/year>, my property in XXXX XXXX sustained significant damage due to a XXXX  event. My XXXX  insurance provider, XXXX, promptly assessed the damage and issued checks made out to both myself and PennyMac for the necessary repairs. These funds are crucial for paying contractors to restore my home, which is essential given we are in the height of hurricane season. 

Despite my repeated attempts to resolve this matter, PennyMac has continued to obstruct the process, causing undue stress and financial strain. Initially, PennyMac refused to endorse the insurance checks, unjustly withholding funds that do not belong to them. Their requirement for a disbursement process, given the delinquency of my loan, created unnecessary and harmful delays. 

On XX/XX/year>, PennyMac released {$5800.00}, and on XX/XX/year>, they released an additional {$2400.00} to pay XXXXXXXX XXXX XXXX XXXX XXXX for the replacement of the air conditioning unit. Subsequently, on XX/XX/year>, an inspector from PennyMac came to my house to inspect the repairs. The inspection passed. Following this, I submitted a request to release the remaining funds to pay for the remaining repairs. 

Despite this, I did not hear anything further from PennyMac. Upon calling today to check the status, I was informed that PennyMac is now completely refusing to release the remaining insurance funds and will be taking the funds, which were provided by my XXXX XXXX  insurance policy and do not belong to PennyMac, to pay the past-due mortgage balance.

PennyMac 's claim that their interest is in the repair of the property is contradictory to their actions. They are now refusing to release the funds necessary to complete the repairs. I am out of work and do not have an income, which has forced me to go hungry for several days and rely on food banks to survive. I have used what little money I have to fix the damages to the best of my abilities to pass the inspection, as PennyMac has refused to release the funds for the repairs until the repairs have been completed.

Because the Veterans Administration has a moratorium on foreclosures and I have expressed my interest in participating in an upcoming VA mortgage assistance program, PennyMac is not able to foreclose on the property. I feel that these actions are intentionally cruel, harmful, and punitive for my participation in the VA assistance programs. 

Details of the Process : On XX/XX/year>, my property in XXXX XXXX was damaged by a XXXX  event. 
XXXX, my XXXX  insurance provider, assessed the damage and issued checks made out to both myself and PennyMac.

PennyMac initially refused to endorse the checks, requiring a disbursement process due to the delinquency of my loan. 
On XX/XX/year>, PennyMac released {$5800.00} to pay XXXX XXXX XXXX XXXX XXXX  for the replacement of the air conditioning unit. 
On XX/XX/year>, XXXX released an additional {$2400.00} to pay XXXX XXXX XXXX XXXX XXXX 
On XX/XX/year>, an inspector from PennyMac inspected the repairs and passed the inspection. 
I submitted a request to release the remaining funds for the remaining repairs. 
On XX/XX/year>, I was informed by PennyMac that they are refusing to release the remaining insurance funds and will use them to pay the past-due mortgage balance.

Demand for Action : I demand that PennyMac immediately endorse and release the remaining insurance funds to complete the necessary repairs to my property. Their continued withholding of these funds is unjust and further jeopardizes my property and financial stability. PennyMac needs to act responsibly and ethically by promptly endorsing and releasing the insurance checks. Failure to do so will leave me with no choice but to pursue further action to ensure my rights are protected.