Consumer complaint received 2018-04-29
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — 
Company: CARRINGTON MORTGAGE SERVICES, LLC (IL)

The below information was sent to Carrington Mortgage Company. It  will explain everything in detail. Thank you in advance for your assistance. 

Carrington Mortgage XXXX Attention Research Department & Escrow Department XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX, IL XXXX Loan Number XXXX Dear Research/Escrow Department Im writing this letter to dispute the decision of having a shortage reserve fund for my escrow account. When I was speaking to your customer service department they referred to this as a cushion in case my escrow goes up. 

My loan was recently transferred from XXXX XXXX XXXX and I was never required to have more that what it would cost to cover my homeowner insurance and my property taxes. If the bill increased I would pay the difference and at that point my mortgage payment would increase to make sure the appropriate amount is there for the next billing cycle. I was advised that nothing would change when my loan was transferred over. I understand that my payment terms have not changed but Carrington Mortgage is requiring me to have more than the billing for taxes and insurance having a cushion INCASE the payment goes up. 

On XX/XX/2018 - I called in and spoke to XXXX, XXXX and a supervisor named XXXX. They all told me that Carrington chooses to opt out in allowing their homeowners not having that cushion and requires it with everyone they said its not required but as they made the decision to make a it this way for every homeowner they service. Well thats already one change from the transfer. For the last 8 years I was not required to have it and now you raise my mortgage payment assuming my bill will increase. ( you dont even have the next bill yet ) 1 ) I advised that if its not a mandatory regulation as stated by XXXX and you chose to opt out, well I as the homeowner should also have the option to opt out. Why should I pay you more than what is needed? All of the funds are placed in a bank account and you as the mortgage collect interest off of our money. I get it, thats one way of making money. If I have to pay you more than the billing just in case then I should receive some of the extra interest that you are making off of my extra funds. I know that this will not happen Im just trying to prove a point. Why give you more than needed. If the bill goes up then either way I will have to pay you. 

2 ) XXXX also mentioned on the call that when you pay the property taxes in two parts ( splitting in two ) Carrington gets a discount. I would like to know what is the discount and does this go toward my account or does Carrington keep these funds? 

3 ) I did the math with XXXX and by XX/XX/XXXX, you will have enough funds to pay both my full escrow payment that is due on XXXX first as well as my homeowners insurance that is due at the end of XXXX. ( with some left over ) When I make my XX/XX/XXXX payment, you will have over {$800.00} to start my next years escrow account. 

With this being said how you can already anticipate what my billing is before you even receive it. Based on last years billing I have more than enough to cover all necessary items including PMI. Now, I completely understand if the bill goes up but as of now I dont feel I should give you any more than I should and I should have the right of not paying the difference that you are requesting in my payment change. Im requesting not to have a cushion as I advised your customer service representative. 

Last Tax Bill - {$8200.00} Due in Full by XX/XX/XXXX Last Insurance Bill -  {$1100.00} Due end of XXXX Total For Both - {$9300.00} Current Escrow Balance - {$6200.00} Monthly Escrow Payment - {$780.00} already excluded PMI. This is just for Taxes and Insurance {$780.00} for 5 months of escrow remaining = {$3900.00} Total in escrow account by XX/XX/XXXX - {$10000.00} {$10000.00} - {$8200.00} ( Taxes ) {$1100.00} ( Home Insurance ) = {$810.00} left in the escrow account. 

As you can see from the above, even if you dont count the XXXX installment, I still have enough to pay both taxes and insurance. 

Im requesting that my payment goes back to the original payment until you receive the new billing. Im requesting that I do not include an additional increase of payment to cover for any potential increases. I would rather keep my own money in the bank and pay the extra increase if the billing increased. My loan is current and I dont feel I should have to pay you more that what is needed. I can save my own money. 

XXXX advised me that she completed understands and that Im not the only person that has been complaining about this, many others are as well. 

This information will also be sent to the CFPB, I will be filing a complaint in regards to this situation. 

Please feel free to reach me at any time to discuss this matter. 

Sincerely, XXXX XXXX XXXX XXXX XXXX XXXX