Consumer complaint received 2018-02-13
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — 
Company: Freedom Mortgage Company (TX)

On XX/XX/XXXX, I wrote a letter notifying of early repayment of portion of my loan and requested to cancel PMI. In addition, I have requested to cancel Escrow account and requested to send me new Amortization schedule to reflect early repayment of the portion of the loan, keeping the original maturity of the loan unchanged. However, albeit numerous mails, emails, telephone conversations with Customer Service Support, I was not able to satisfy myself to Freedom Mortgage Response response to my letters. Below I provide detailed explanation of each issue. 

1. First, I have requested information about prepayment portion of the loan in advance and received a response letter dated XX/XX/XXXX ( references enclosed ). Freedom Mortgage letter listed restrictions on Recast/Principal Curtailment, and related fees, which I have not found in my Original Loan Agreement. I have made numerous calls to dispute your responses, not stipulated in my Original Loan Agreement. In addition, on XX/XX/XXXX, I sent a registered mail in response to Freedom Mortgage letter in addition to sending it by email ( copy of email is attached ), where I have clearly indicated detailed reasons why requirements mentioned in Freedom Mortgage letter to early repayment are not in accordance Loan Agreement. I still have not received their response to my letter dated XX/XX/XXXX ( email as well ). 

2. Second, I have requested a statement document from Freedom Mortgage and received a letter of response dated XX/XX/XXXX. The statement detail incorrectly showed the balance of the loan as of XX/XX/XXXX, and did not reflect principal repayment received by Freedom Mortgage onXX/XX/XXXX. Although I have multiple calls and sent email on XX/XX/XXXX confirming USPS delivery of the check to your XXXX XXXX ( refer to email dated XX/XX/XXXX ), the statement and reports were still not updated, and did not reflect accurate payments and balance of the loan in XX/XX/XXXX. 

Moreover, the balance of the loan as of XX/XX/XXXX was not correctly reported in the Monthly Statement, credit agencies, and Tax statement although I made several calls to the customer service department requesting to correct posting date, and provided evidence that the prepayment cashier check has been delivered to Freedom Mortgage payment address on XX/XX/XXXX at XXXX XXXX. I sent sufficient evidence by email several times ( email evidences are attached ), and it was still ignored. As it was a cashier check, Freedom Mortgage had responsibility to deposit it on the same day and correct balance. As a Borrower, I can not be responsible for any operational issues with processing and posting payments inherent at Freedom Mortgage. Although, Customer Service representative said that they have corrected posting date ( screenshot is attached ) to reflect early repayment portion of the loan, the balance on my statement dated XX/XX/XXXX was still overstated by USD XXXX dollars. As a consequence, my Monthly statement dated XX/XX/XXXX and XX/XX/XXXX IRS XXXX form were incorrectly reported, falsifying balance and payment on the loan. Statement and XX/XX/XXXX IRS Form XXXX enclosed ( attached to the email ). 

3. Third, in a letter of response I received from Freedom Mortgage dated XX/XX/XXXX, the lender required me to get an appraisal of the property only with Freedom Mortgage appraisal vendor XXXX XXXX   and indicate a reference account number when contacting appraiser. 

I called customer service after that to clarify why I must use only XXXX XXXX to perform appraisal of my property, and Customer Service mentioned that it Freedom Mortgages requirement to use this vendor. I would like to object this requirement because of two reasons : I do not have a specific wording in my original Loan agreement which would require me to use Lender required vendor for appraisal. In addition, I would like to choose an independent vendor to perform this appraisal to avoid any potential bias and I dont find this requirement reasonable in accordance with Loan Agreement. Please find below is the paragraph of my Original Loan Agreement that specifies this : The requirement for private mortgage insurance in connection with your loan will be cancelled on the cancellation date if you have satisfied the following conditions : ( 1 ) You must have submitted a request in writing to the servicer of your loan that cancellation will be initiated ( 2 ) You must have a good payment history with respect to your loan, and ( 3 ) You must have satisfied any reasonable requirement of the lender or current holder of the loan for evidence that the value of residence securing your loan has not declined below original value of the property and for certification that the equity in your residence has not been encumbered by a subordinate lien Based on above, I do not consider Freedom Mortgage requirement to use only XXXX XXXX for appraisal of my property as a reasonable condition of my Loan Agreement. 


4. Fourth, the following requirements were noted in the Letter received from Freedom Mortgage on XX/XX/XXXX for as a requirement for PMI cancellation to my letter dated XX/XX/XXXX : PMI may be cancelled once one of the following ( LTV ) requirements is met, in addition to any other guidelines required by investor : A Loan-To-Original-Value ratio of 80 % or less ( original value is considered the lesser of the purchase price or original appraisal ) and a current property value at least equal to the original property value. 

A new appraisal demonstrates Loan-To-Original-Value ratio of 75 % or less for loans aged between two and five years. 

A new appraisal demonstrates Loan-To-Original-Value ratio of 80 % or less for loans aged greater than five years. 

A new appraisal demonstrates Loan-To-Original-Value ratio of 75 % or less for loans aged less than two years and the appraisal indicates significant improvement in the property My Original Loan agreement  contains only the following paragraph with regards to this request : You may cancel the requirement for private mortgage insurance in connection with your loan earlier than the date provided in your initial amortization schedule based on actual payments. You cancellation date in that event is the date on which the principal balance of your loan reaches 80 % of the original value of your residence based upon your actual payments. This may occur, for example, if you prepay principal on your loan. 

Hence, my Original loan agreement neither contains any reference to investor guidelines required by investor, nor any reference to 75 % for loans aged less than two year, nor reference to appraisal indicates significant improvement in the property as you indicated in a response letter. Therefore, unless you can provide me with a specific evidence based on the Original Loan agreement, I consider your response violating Loan Agreement and does not conform to the requirements of the Original Loan Agreement. 

In addition, the letter of response received from Freedom Mortgage set a seasoning requirement of 24 months before PMI can be cancelled ( letter of response is attached ). 

The responses received from XXXX XXXX violates HPA and not in accordance with the provisions of my signed loan agreement. 

5. Fifth, in my letter/email dated XX/XX/XXXX, I have requested you to cancel Escrow in accordance with Loan Agreement. I received a response from Freedom Mortgage with a letter dated XX/XX/XXXX,  which provided the following requirements for cancellation of escrow have not been met : Loan currently has PMI Loan has not been seasoned for at least 24 months In accordance with loan agreement, the following clauses are specified for waiving escrow : Lender may waive Borrowers obligation to pay to Lender Funds for any or all Escrow Items at any time. Any such waiver may only be in writing The Loan Agreement does not have any requirement for PMI or Seasoning for waiving the Escrow Account. Therefore, I do not consider the response in accordance with the Loan Agreement. 

The letter lists the following conditions necessary for cancelling an Escrow account : 1 ) Loan is not an FHA loan 1 ) Loan has a Loan to Value Ration below ( 80 % ) a. This percentage is calculated suing the current principal balance at the time of your request divided by the appraised value of the property at closing. 
b. Any request to remove escrow for loans with a Loan to Value Ration of 80 % or higher will be denied 2 ) Loan has good payment history or timely payments for the principal, interest, escrow payments a. Borrowers may not have more than one 30-day delinquency in 12 months prior to evaluation, or more than one 60-day delinquency in 24 months prior to evaluation b. Your loan is current at the date of review c. If the loan does not meet the requirements months of good payment history, then the request for removal will be denied. 
Once the above conditions are met, you may submit a new written request for consideration I state here that ( a ) My Loan Agreement does not have these specific requirements listed as a condition for cancellation of Escrow and ( b ) I still met all these requirements as of the date of your response letter. 

Based on above, I consider Freedom Mortgage denial to remove Escrow as a breach of terms and conditions of the Loan Agreement.

6. Sixth, on the same letter dated XX/XX/XXXX, I have also requested Freedom Mortgage to change monthly payment amount based on the updated balance and keeping maturity of the loan unchanged as in Original Loan Agreement XX/XX/XXXX. Unfortunately, Freedom Mortgage has not responded to this request to change the monthly payment nor sent me revised amortization schedule. 


7. Seventh and ultimately, on top of failing to my request noted in the sixth point, Freedom mortgage has not shown correct maturity of the loan based on the revised Amortization schedule ( screenshot of the attached ). 

Paragraph 4 of the Note in my loan agreement specifies the following about Partial prepayment : If I make a partial Prepayment, there will be no changes in the due date or in the amount of my monthly payment unless the Note Holder agrees in writing to those changes In my Letter dated XX/XX/XXXX ( see reference of delivery of mail and a copy of the original email ), as the principal prepayment event ahead of amortization schedule triggers either a change in ( a ) maturity or ( b ) monthly payment amount, I have requested Freedom Mortgage to change my monthly payment amount, keeping the original maturity of the loan unchanged. Unfortunately, current maturity date on Freedom Mortgage web page is still shown as XX/XX/XXXX ( see screenshot of webpage, and the monthly payment amount is still unchanged, This is leading to overstating my future cash outflow due by estimated USD XXXX dollars ( principal and interest only ). 

To resolve the problems, I would appreciate if you could address above issues as follows : I have requested the following response From Freedom Mortgage, for which I have not received any response nor call. 

On the issue numbered ( 1 ) I would appreciate your response to my letter/email dated XX/XX/XXXX, specifying your substantiation of requirement with specific reference to my Original Loan Agreement.  Please provide explanation to any deviations of your response letter from Loan agreement, with reference to specific clause in Loan agreement. 

On problem numbered ( 2 ) I request written amended Mortgage Statement dated XX/XX/XXXX, Amendment to IRS form XXXX, amendment to my escrow account, transactions and balances and amendment to credit reporting agencies. I also request your explanation why balance on my statement was not shown correctly and why Freedom Mortgage has not taken into account evidence of delivery of the cashier check from postal carrier I provided to you in the previous email communications. I would also require Freedom Mortgage recalculate interest posted on the balance on the effective date of payment and send me a check for the difference of posting date and payment date. In addition, I retain the right to report such inaccuracies to Consumer Financial Protection Bureau, XXXX, Texas Department of Saving and Mortgage, and IRS. 

On problem numbered ( 3 ) Unless Freedom Mortgage provides me with other evidence of requirements indicated in the letter with specific reference to my Original Loan agreement within 15 business days from the receipt of my letter by mail or email, I will report to Consumer Financial Protection Bureau, XXXX, Texas Department of Savings and Mortgage and will consider further legal action based on resolution of the matter. Again, I restrictions to use Single Source not reasonable requirement. 

On problem numbered ( 4 ) Unless you provide other evidence of your all of your requirements to cancel PMI indicated in your letter with specific reference to Original Loan agreement within 15 business days from the receipt of you my letter by mail/email, I require that you cancel all PMI payments effective XX/XX/XXXX and send me the check for any overpaid amount since XX/XX/XXXX. Even though, I may hire an appraiser after a response received from you, I request that you accept the appraisal from my initial request date, which is XX/XX/XXXX when my LTV ratio reached 79.33 %. Late appraisal would have been resulted from inconsistencies of your requirements with my Original Loan Agreement I have indicated above. 

On the problem numbered ( 5 ) Unless Freedom Mortgage provides me with evidence of requirements indicated in the letter for removing Escrow with specific reference to my Original Loan agreement within 15 business days from the receipt of my letter by mail or email, I will report to Consumer Financial Protection Bureau, XXXX, Texas Department of Savings and Mortgage. I also require you cancel Escrow and return the balance outstanding on my Escrow account within 15 business days via check. 

On the problem numbered ( 6 ) and ( 7 ) I request Freedom Mortgage to send me updated amortization schedule taking into consideration partial principal prepayment made on XX/XX/XXXX, correcting either ( a ) monthly payment amount, or ( b ) maturity of the loan. I also request that Freedom Mortgage respond to my request, and based on response, pay me back the difference of principal/interest overpaid based on revised schedule of payment/amortization schedule. I have attached preferred mortgage schedule for your reference. If freedom Mortgage decides to keep both payment amount and maturity of the loan unchanged, I will require that you immediately repay me total amount of future cash flow in excess of the Loan including interest thereon immediately. The estimated amount of future cash outflows under these circumstances is estimated to be {$53000.00} dollars. 

This letter contains 6 pages, all of which form part of the letter. This mail will be communicated both by email and registered mail. I look forward to your reply and a resolution to my problem and will wait until XX/XX/XXXX before seeking help from a consumer protection agency or XXXX XXXX XXXX, Texas Department of Savings and Mortgage and Texas Attorney General. Please contact me at the above mailing/email addresses provided or by phone at XXXX if you have any questions. 

For the attention of CFPB I have been trying to resolve the issue for over 2 months, however, I have not received any valid resolution of my requests dated XX/XX/XXXX.