Consumer complaint received 2025-11-24 00:00:00
Product: Mortgage — VA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Freedom Mortgage Company
State: FL

Complaint narrative:
During the summer of 2025, around XXXX, we were notified by XXXX XXXX XXXX that we would be required to obtain flood insurance in order to maintain our existing wind and hail policy. Although our home is not located in a designated flood zone and flood insurance is not typically required, XXXX guidelines now mandate that XXXX policyholders carry this coverage. 

At the time, our primary homeowners ' insurance policy was with XXXX, with XXXX providing separate wind and hail coverage. Followingthe XXXX notice, we began shopping for alternative wind and hail policies, as our homeowners coverage with XXXX remained active throughout the entire process. We were ultimately able to secure a combined homeowners and wind/hail policy through XXXX. However, due to the processing time required to finalize the new policy, there was an unintended XXXX lapse in wind and hail coverage between the cancellation of our XXXX policy and the effective start date of our XXXX policy. 

On XX/XX/year>, we received a letter from Freedom Mortgage stating that they would be placing lender-provided coverage on our home for the lapse period unless we could provide proof of continuous coverage. The letter indicated that the estimated annual cost of this lender-placed policy would be {$310.00}. I contacted Freedom Mortgage to discuss the matter, and together we calculated that the prorated amount for the XXXX lapsebased on approximately {$0.00} per daywould total about {$20.00}. The representative agreed that the amount should be close to that figure, acknowledging that it might vary slightly. We even remarked on how unreasonable it seemed, but understood that this was the mortgage companys standard procedure for handling lapses in coverage. 

However, today I received another letter from Freedom Mortgage, dated XX/XX/year>, stating that the wind-only policy they selected on our behalf would cost {$4700.00} annually. Based on this figure, the prorated charge for the XXXX lapse would be approximately $ XXXX higher than what was previously calculated and agreed upon. 

I called Freedom Mortgage again to address the discrepancy. The representative informed me that lender-placed insurance is typically double the cost of a standard policy. I explained that our previous wind-only policy with XXXX was roughly {$800.00} per year, and even the highest quotes I received while shopping for wind-only coverage were no more than {$1500.00} annually. Furthermore, our current combined homeowners policy with added wind coverage through XXXX costs only {$2600.00} annually. The {$4700.00} figurenearly XXXX times what we previously paid for wind coverageappears excessive and suggests that Freedom Mortgage is significantly inflating the cost of the lender-placed policy. 

This discrepancy raises serious concerns about price gouging and unfair consumer practices, as the amount presented bears no reasonable relationship to standard market rates for wind-only insurance coverage.

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