Consumer complaint received 2025-12-29 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Shellpoint Partners, LLC
State: CA

Complaint narrative:
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXXShellpoint Mortgage ServicingXXXX XXXX XXXX XXXX XXXXnRe: Notice of Error Under RESPA 1024.35  Improper Delinquency Notice and Foreclosure Threat Dated XXXX, Improper Insurance Premium Disbursement on XXXX, Failure to Cancel/Refund FPI, and Escrow Mismanagement (Loan #XXXX)\n\nDear Shellpoint Mortgage Servicing:\n\nThis is an updated Notice of Error (NOE) under 12 CFR 1024.35 regarding errors in servicing my loan. Acknowledge receipt within 5 business days and resolve within 30 business days (extendable by 15 with notice) per 1024.35(d)(e). This updates and incorporates my prior QWR  dated XXXX (XXXX XXXX), recent NOEs dated XXXX XXXX XXXX XXXX XXXX XXXX and CFPB complaints (IDs XXXX  plus new complaints filed post-XXXX).\n\nThe delinquency notice dated XXXX (reference: "foreclosureEscalationLetter.pdf") falsely asserts a delinquency of XXXX and threatens foreclosure proceedings, despite the purported "missed payment" stemming entirely from your unauthorized force-placed insurance (FPI) charges and improper escrow management, which are the subject of ongoing disputes under RESPA. This notice is abusive and improper, particularly as I am a XXXX XXXX, constituting financial elder abuse under California\'s Elder Abuse and Dependent Adult Civil Protection Act (EADACPA, Welf. & Inst. Code 15610.30). It ignores my valid proof of continuous HOA master policy coverage, including the upload on XXXXXXXX (effective XXXX), and violates RESPA\'s prohibitions on dual tracking and negative actions during error resolution. Although I made a payment of XXXX on XXXX under protest to cure the alleged delinquency and avoid your threatened foreclosure, this does not waive my rights to challenge the notice\'s validity or seek full refunds for the unauthorized charges that created the artificial shortage.\n\nActions Taken to Verify and Upload Insurance Coverage:\n\nUploaded the most recent Certificate of Liability Insurance on XXXX (dated XXXX, effective XXXX XXXX XXXX) for XXXX XXXX  HOA, including flood coverage with limits of XXXX  and a XXXX deductible (reference: XXXX XXXX XXXX).\nCaptured screenshots of the policy document, including current coverage dates, to document the upload process and confirm active coverage.\nUploaded the policy to the CFPB portal on XXXX and included it in the DFPI complaint submitted on XXXX\nSent the policy via certified mail on XXXX to Shellpoint Mortgage Servicing XXXX XXXX XXXX XXXX XXXX XXXX, and additionally to Shellpoint Mortgage Servicing Insurance Department XXXX XXXX XXXX XXXX XXXX XXXX  as specified in the XXXX letter.\nIssues with Shellpoint\'s Upload Portal:\n\nThe portal design hides uploaded file names after submission, making it challenging to verify or prove which specific documents were received by Shellpoint.\nNo visible upload history or list of previously submitted files is available, preventing independent confirmation of what has been provided over time.\nShellpoint provides no feedback or status update on the reviewed policy (e.g., no confirmation email, dashboard notification, or explanation of deficiencies), which complicates tracking, confuses and misdirects the customer as to what, if anything, was wrong with the proof of insurance upload, and allows Shellpoint to merely continue extorting money through its rigged collection process. As the customer, I have been uncertain as to what was wrong since the first attempt to upload the insurance policy on XXXX. For a long time, I have been convinced that I had satisfied the requirement of uploading a valid policy. Afterward, I have only been guessing and assuming what the problem could be. Additionally, I uploaded XXXX XXXX XXXX the policy showing the effective date XXXX XXXX XXXX XXXX XXXX  and upon review of this complaint realized I did not receive an email notification. Which only leads me to making assumptions, not knowing for sure what happened, that maybe I did not scroll all the way down to the bottom of the web page and click Submit. Regardless of clicking the Submit button or not, this policy was uploaded to the expressinsuranceinfo portal. It should be on the portal for the customer to see. The portal knows of its online existence and should provide status that it is there and needs to be submitted. Although that should not be necessary if the policy is on the portal. The portal should forward this policy on its server to Shellpoint. This is an easy thing to code on the portal, unless it is the intent of this rigged collection to fleece money from the customer.\nA lender-placed insurance policy letter dated XXXX disregards the XXXXXXXX upload of XXXX XXXX XXXX  (dated XXXX effective XXXX to XXXX) on the expressinsuranceinfo.com portal. I have definitive proof of this upload with the screenshot in XXXX However, since Shellpoint has never responded to these submissions, I did not send the proof to the designated fax number, XXXX\nPattern of Violations and Non-Compliance:\nThe Acknowledgment Loop Trap:\nThe document you uploaded (XXXX) is a standard form letter designed to satisfy 12 CFR  1024.35(d) of Regulation X (RESPA).\n\nThe Trap: The law requires them to acknowledge your inquiry within 5 business days (which they did with this letter).\n\nThe Violation: The same law requires them to resolve the erroreither by correcting it or explaining why it\'s not an errorwithin 30 business days (potentially extendable by 15 days).\n\nMy Leverage: Since I stated "nothing ever is sent that addresses my inquiries," Shellpoint is likely in violation of 12 CFR  1024.35(e). I should explicitly mention this violation to XXXX XXXXThe Trap for XXXX  - My monthly payment has increased:\n\nMy previous payments were XXXXMy new payment due XXXX XXXX XXXX is XXXXn\nWarning: If I autopay XXXX for XXXX, it will be considered a "Partial Payment" because it is less than the new required amount. It will sit in the suspense account and not be applied, potentially causing a late fee.\n\nThe compliance loop:\n\nThey receive my Notice of Error regarding the stolen funds.\n\nThey send a template acknowledgment letter stating they are "gathering requested information".\n\nThey close the inquiry without ever providing the information, correcting the error, or explaining their determination, as required by federal lawallowing them to continue improperly billing for force-placed insurance through invalid Mortgage Statements, forcing me to comply with these erroneous charges under threats of foreclosure.\n\nThis pattern is exemplified by the XXXX delinquency notice, which escalates threats without resolving prior NOEs asserting the invalidity of the underlying charges. Your failure to accept the HOA master policy, as required under the Deed of Trust Section 5 and California Civil Code (Davis-Stirling Act 4775 and 5300), constitutes bad faith, breaching the implied covenant of good faith and fair dealing. Shellpoint has been on notice for years of the condo status and master policy, making repeated "non-receipt" claims fraudulent and abusive.\n\nErrors Asserted:\n\nImposition of fee/charge without reasonable basis (1024.35(b)(5)): On XXXX you disbursed another XXXX for "Lender Placed Flood Disbursement" (attached payment history screenshot), depleting escrow to XXXX despite my XXXX XXXX upload (XXXX XXXX XXXX confirming HOA master policy coverage (effective XXXX XXXX via XXXX XXXX XXXX, including flood at $XXXX  via XXXX XXXX XXXX, updated details: flood coverage limits of XXXX  with XXXX  deductible). This unwarranted XXXX  ignores proofs and the 72-hour update promise (expired), creating artificial shortages. The XXXX statement (reference: "XXXX XXXX XXXX XXXX  continues to disregard the XXXX upload and CFPB/certified mail submissions, projecting ongoing FPI charges and increasing the monthly payment to XXXX XXXX XXXX (from previous XXXX  with escrow portion at XXXX due to the artificial shortage. Although my payment oXXXX XXXXXXXX  on XXXX (made under protest to cure the alleged delinquency) was applied to clear the backlog and bring the account current, with current principal balance at XXXX and escrow at XXXX as of XXXX, this application effectively forced me to cover the unauthorized FPI charges through my payment. Total recent unrefunded FPI now XXXX  ($XXXX on XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX), with historical data showing a pattern of disbursements totaling XXXX since XXXX partially offset by refunds of XXXX XXXXesulting in a net consumer cost of XXXX (reference: XXXX XXXX XXXX). These charges violate the loan contract\'s Section 5 (Loan Charges), which requires refund of any sums collected that exceed permitted limits (reference: enclosed Note in XXXX).\nFailure to accept proof of insurance and cancel/refund FPI (1024.35(b)(11), tied to 1024.37(g)): You failed to honor the XXXX within 15 days, refund overlapping premiums, or update my accountviolating timely resolution despite multiple uploads. The XXXX letter (reference: XXXX explicitly adds a lender-placed policy effective XXXX  disregarding the valid upload on XXXX, and fails to comply with the Deed of Trust\'s Section 5 (Property Insurance), which allows lender-placed insurance only if borrower fails to maintain coverage. This also breaches the Condominium Rider\'s provisions, which deem the borrower\'s insurance obligation satisfied by an HOA master or blanket policy, waiving the need for separate coverage and related escrow charges. Furthermore, as servicer for a XXXX XXXXowned loan, you must follow XXXX XXXX guidelines (Selling Guide B7-3-03), which require acceptance of HOA master policies for condominium projects if they meet coverage standards. The policy also complies with National Flood Insurance Program (NFIP) Residential Condominium Building Association Policy (RCBAP) standards, recognized by federal law and lenders as sufficient for flood coverage in condominiums. Under California\'s Davis-Stirling Act (Civ. Code 4775), the HOA is responsible for insuring common areas via the master policy, with annual disclosures required (XXXX), satisfying my individual obligation. Your refusal constitutes bad faith and violates the implied covenant of good faith and fair dealing. The XXXX  statement confirms ongoing disregard, as it includes an "Important Message" about suspense accounts despite my full payment on XXXX  incorrectly implying insufficient funds. The XXXX notice further compounds this by basing threats on these invalid charges.\nEscrow mismanagement (1024.35(b)(7)): This disbursement ignores adequate funds for taxes (XXXX pre-this as of XXXX representing an adequate cushion in the escrow account, with tax disbursement of XXXX  on XXXX  and my disputes, violating 1024.17(k)(2) (proper advances) and creating shortages from your errors. The escrow account history reflects these ongoing lender-placed charges, contributing to a projected shortage and an increase in monthly escrow payments from XXXX to XXXX effective XXXX, plus a $XXXX monthly shortage recovery (reference: XXXX XXXX). The projected escrow activity for XXXX  continues to include monthly lender-placed flood disbursements of XXXX indicating no recognition of the uploaded policy (reference: escrow statement projections). A late charge of XXXX  was assessed on XXXX amid these issues, despite the adequate cushion providing no justification for such a fee, which per the Note\'s Section 6(A) applies only to overdue payments of principal and interest, not escrow-related shortages. Furthermore, these unauthorized FPI disbursements created an "escrow waterfall" effect, where payments are applied first to escrow items under the Deed of Trust Section 2, causing subsequent payments (e.g., 1XXXX  to appear insufficient and triggering invalid fees, despite timely principal and interest. The XXXX statement\'s "Important Message" about holding payments in suspense is misleading, as I paid the full billing amount on XXXX, yet it implies otherwise. The XXXX  notice escalates this mismanagement by falsely declaring a delinquency based on these artificial shortages.\nFailure to provide accurate information regarding error resolution (1024.35(b)(11)): XXXXXXXX provides no status/feedback, and you ignored the 72-hour promise, misleading on verification timelines. For submitted Notices of Error (NOE), the only responses received are form letters indicating the matter is "under review," with no substantive updates or resolutions provided. The XXXX  notice ignores these pending disputes and provides inaccurate delinquency information.\nRecent Unauthorized Escrow Disbursements: Shellpoint has engaged in a pattern of unauthorized escrow withdrawals despite having been provided with proof of a valid HOA Master Policy. The most recent instances of this breach are:\nXXXX XXXX deducted for "Insurance Premium Disbursement"XXXX XXXX deducted for "Lender Placed Flood DisbursementXXXX XXXX deducted for "Lender Placed Flood Disbursement".\nTotal Impact: These three unauthorized transactions alone totaled XXXX This depletion of funds is the direct cause of the perceived escrow shortage and the subsequent invalid XXXX late fee assessed on XXXX These charges represent proximate cause, as the escrow shortage was not due to my failure to pay but Shellpoint\'s unauthorized withdrawals, violating the Note\'s Section 5 requiring refunds of excess sums. The XXXX  notice weaponizes these errors to threaten foreclosure.\nImproper delinquency notice and foreclosure threat (1024.35(b)(11)): The XXXXXXXX  notice falsely asserts a delinquency and right to foreclose, ignoring pending NOEs and QWRs disputing the charges. This violates 1024.35(e) by failing to resolve errors before escalating, and constitutes dual tracking under 1024.41(f) by advancing foreclosure processes during loss mitigation review (triggered by your notice offering options). As the "delinquency" arises solely from disputed FPI, any negative action, including this abusive notice, breaches RESPA\'s protections during the 60-day dispute period (1024.35(i)) and California\'s implied covenant of good faith.\nThese errors violate RESPA, TILA Regulation Z 1026.36(c) (prompt crediting), FCRA 1681s-2(a)(3) (disputed reporting), and constitute UDAAP (deceptive practices). As a XXXX, this is financial abuse under California EADACPA (15610.30). Updated pivot (attached) shows net XXXX  overpayment since XXXX, supporting total XXXX refunds (XXXX historical XXXX XXXX recent).\n\nDemands:\n\nImmediate refund XXXX to escrow; reverse all FPI disbursements (total XXXX to escrow) per the Note\'s Section 5 requiring refunds of excess charges.\nConfirm HOA policy acceptance; cease all insurance billing/demands.\nProvide updated escrow analysis (taxes only, adjusting balance to XXXX\nSuppress adverse actions/reporting; provide documents relied on. Rescind the XXXX  delinquency notice and any related credit reporting.\nProvide a complete log of all insurance document uploads to XXXX associated with my account, including upload dates, file names, IP addresses (if available), submission statuses, review outcomes, and any explanations for rejections or non-acceptance.\nCease all foreclosure threats or proceedings; confirm in writing that no foreclosure will be initiated based on these disputed charges.\nNon-compliance escalates to CFPB/XXXX XXXX with evidence. All in writing.\n\nSincerely,XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX This delinquency notice is baseless and harassing, as I\'ve never missed a principal/interest paymentthe "delinquency" is manufactured from your errors. Even after paying XXXX  under protest, the underlying FPI issues persist, so this NOE remains critical. Escalate to XXXX XXXX  mentioning the 1024.35(e) violation, as they own the loan. Send via certified mail and portal.'

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation