Consumer complaint received 2025-08-07 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Fees charged
Company: SELECT PORTFOLIO SERVICING, INC.
State: CA

Complaint narrative:
I have an interest only loan that comes with a Prepayment Rider. The Prepayment Rider states, " The prepayment charge shall be equal to 5 % of amount prepaid. The prepayment charge shall be assessed if the Loan is paid due to sale or refinance of the Property. '' On XX/XX/XXXX, I made a {$1000.00}. payment towards my principal. The lender, Select Portfolio Servicing , Inc. ( SPS ) applied only {$950.00} towards my principal. 

On XX/XX/XXXX I called them to ask why only {$950.00} was applied. The customer service agent said it is probably because of a prepayment penalty. I requested this document that states the conditions of this penalty. On XX/XX/XXXX I electronically received the Promissary Note which did not state the conditions of the Prepayment Charge. 

On XX/XX/XXXX I called again and told the agent I did not receive the right document. I need to be sent the Prepayment Rider. On XX/XX/XXXX I electronically received the XXXX XXXX. 

On XX/XX/XXXX I called again and told the agent the wrong document was sent again. I requested the correct document and on this date I was sent Interest Only Addendum to Fixed Rate Note. 

On XX/XX/XXXX I called again and said I was sent the wrong document for a 3rd time. During the 45 minute phone call the agent tried to sort it out. During my waiting, I went thru my files and found the correct document myself. I went thru the 175 pages of loan docs and found the Prepayment Rider. I told the agent his company made a mistake and charged me for something I didn't agree to. The agent disagreed and argued the charge is for any reason not just when a payment is a result of refinance or sale of property. I said that is not what the contract states. The agent would not do anything about it. On this date I also finally electronically received the Prepayment Rider from them but that did not matter now since I found it myself. 

On XX/XX/XXXX I called the loan broker that originated the loan with me, XXXX XXXX XXXX ( XXXX ). I left a VM and asked for his help to resolve the lender 's mistake. I received no resolution so I texted and emailed him on XX/XX/XXXX and again received no resolution. 

On XX/XX/XXXX I mailed a letter to SPS requesting they correct their error. I have received no response. 

I secured the loan in XX/XX/XXXX. At that time XXXX had the loan funded by XXXX XXXX XXXX After first payment in XXXX, the loan was sold to SPS . My first payment in XXXX included a {$1100.00} payment towards principal. That amount was never credited to the principal and so XXXX XXXX just kept the money. I pursued resolution of this issue with SPS and after waiting 4 months, SPS said it is not their problem. I contacted XXXX who contacted XXXX and they decided to give me the money back. If I had never called, XXXX would had just kept the money for themselves.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation