Consumer complaint received 2020-03-15
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — 
Company: CARRINGTON MORTGAGE SERVICES, LLC (MD)

I have had a loan on a home for nearly 10 years, every single payment has been made on time. The original loan recently passed through several new mortgage processing companies in a very short period of time, which resulted in a near constant need to change the recipient of the mortgage payment. The most recent change occurred on XX/XX/2019, when the mortgage changed from XXXX  XXXX to Carrington Mortgage Services. On XX/XX/2019 - right after the loan moved - Carrington issued an AEADS notice ( which I reviewed in early XXXX ) increasing the required monthly payment amount from {$2000.00} to {$2100.00} effective XX/XX/XXXX - I was currently sending {$2000.00} at the time. NOTE that this change to increase the loan amount was a result of an escrow increase made by the lender not an actual change in additional loan interest due. MEANING the lender caused a payment amount change in a very short period of time triggering the likelihood of a shortfall and a late payment charge if the consumer did not make a rapid adjustment. 

It was not clear to me which payments would need to be changed and when I should adjust my auto payment to accommodate the rapid increase. I received a notice that the payment I had made was short, so I contacted an agent on XX/XX/XXXX ( very, very long wait time ) to inquire as to the status of the account and what I need to do to correct it. As confirmed by Carrington, I was told by the agent that the account was in good standing, and nothing needed to be done. Nonetheless, to make sure there were sufficient funds to handle late payments and amounts due, I sent in an additional sum of {$250.00} which it turns out was incorrectly applied to principal which then triggered another late payment. The result was that, due to late payments building up, sufficient funds were not there triggering another late payment. 

This sequence of events has continued whereby I received a notice telling me the payment amount is insufficient ( in the mail at a date that is too late to correct ), and then I am told to call Carrington to resolve. The calls take hours to attempt to resolve, and nothing gets fixed, just more mail. I am told the reason this has happened is that I have not told them how to apply my payments ( which I can not do through an auto payment at my bank ) so Carrignton keeps applying over payments to principal instead of resolving the gap. By doing this, they are creating loan payment shortfalls that result in late payment fees. I don't believe they have a right to choose how to apply my payments in a way that advantages the late fee process - which is exactly what they are doing as opposed to applying the payments in a consumer advantaged manner. 

I am filing a complaint as Carrignton seems to use the loan payment documents and payment change process to generate revenue from late fees. While they might technically ( fine print ) be following a process obscurely contained in the loan documents, they are surely preying on consumers. Someone needs to stand up for the consumer to correct this. I also believe the CFPB should demand Carrington refund all mortgagees who have had a sudden change to loan payments that resulted in timing/amount issues and late fees.