Consumer complaint received 2024-01-10
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Onity Group Inc. (FL)

I Purchased a brand new home in XXXX from XXXX XXXX. I also XXXX at XXXXXXXX XXXX at the time I am a XXXX XXXX in the state of Florida I Purchased my home insurance through XXXX XXXX insurance in XXXX mortgage. They broke the policy out to XXXX, which is also called XXXX XXXX. I initially had my loan through XXXX XXXX who sold the loan to PHH mortgage. It is an FHA loan that requires all insurance and taxes be paid out of escrow at closing. I paid a year and a half of insurance as well as money was taken out for my monthly mortgage payment in XX/XX/XXXX it appears my mortgage company did not pay the full premium. It was short {$110.00}. XXXX XXXX says it was charging {$110.00} more for papers that I needed to sign that were not signed which would be impossible because I have a policy and went to closing. I never wouldve been able to close on the home if I hadnt sign for the policy, my closing was delayed and so according to the lady I spoke to they reissued me another policy with a different policy number, but did not explain to me. It was a whole different policy anyways, we wouldnt have been able to close without those signatures but we did when they found a mistake they added {$110.00} to the premium to compensate for that, according to them PHH mortgage did not pay the XXXX so they canceled my insurance policy. According to PHH they never received notification of the additional amount. When they called XXXX XXXX to find out why the policy hit last and try to make payment for the {$110.00} XXXX XXXX refused to accept the payment at that time. PHH needed to get their lawyers involved because this is a violation of RESPA. The law states that if mortgage company fails to pay escrow and the policy lapses or is expired it, is there a duty to call the insurance company and get the policy reinstated within 90 days. And the insurance company is supposed to reinstate the same policy within that 90 days, none of this happened instead they put the onus on me to purchase homeowners insurance that was twice three times the amount of my original policy. I called XXXX XXXX myself and they didnt mention any of the law and try to quote me a higher price as well. She asked if they could reinstated, and they said no, which was a lie and violation of RESPA. Whoevers fault it was whether it was the mortgage company or the insurance. They both are at fault because they did not follow the remedy. It is very clearly written. Neither company is returning my calls or taking this seriously and they are letting the 90 days go by. Also, the law states that if it was The mortgage companys fault for not paying the escrow, they are supposed to pay the additional amount for the next two years that my payment has gone up per month. I expect this to be enforced. 

sect 501.37 1 ) Every lender of money, whether a natural person or an artificial entity, whose loans are secured by a mortgage on real estate located within the state and who receives funds incidental thereto or in connection therewith for the payment of property taxes or hazard insurance premiums when the funds are held in escrow by or on behalf of the lender, shall promptly pay the taxes or insurance premiums when the taxes or premiums become due and adequate escrow funds are deposited, so that the maximum tax discount available may be obtained with regard to the taxable property and so that insurance coverage on the property does not lapse. 
( 2 ) If an escrow account for the taxes or insurance premiums is deficient, the lender shall notify the property owner within 15 days after the lender receives the notification of taxes due from the county tax collector or receives the notification from the insurer that a premium is due. 
( 3 ) ( a ) If the lender, as a result of neglect, fails to pay any tax or insurance premium when the tax or premium is due and there are sufficient escrow funds on deposit to pay the tax or premium, and if the property owner suffers a loss as a result of this failure, then the lender is liable for the loss ; except, however, that with respect to any loss which would otherwise have been insured, the extent of the liability shall not exceed the coverage limits of any insurance policy which has lapsed. 
( b ) If the lender violates paragraph ( a ) and the premium payment is not more than 90 days overdue, the insurer shall reinstate the insurance policy, retroactive to the date of cancellation, and the lender shall reimburse the property owner for any penalty or fees imposed by the insurer and paid by the property owner for purposes of reinstating the policy. 
( c ) If the lender violates paragraph ( a ) and the premium payment is more than 90 days overdue or if the insurer refuses to reinstate the insurance policy, the lender shall pay the difference between the cost of the previous insurance policy and a new, comparable insurance policy for a period of 2 years. If the lender refuses, the lender is liable for the reasonable attorneys fees and costs of the property owner for a violation of this section. 
( 4 ) At the expiration of the annual accounting period, the lender shall issue to the property owner an annual statement of the escrow account.