Consumer complaint received 2024-11-20 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Mr. Cooper Group Inc.
State: MI

Complaint narrative:
ISSUE 1 : Failed to use basic loan and home purchase information to accurately forecast Michigan property tax assessments, and failed to schedule escrow payments accordingly, causing a shortfall when the tax bill was due. Lender then passed on a 170 % increase in escrow payments and 45 % increase in total mortgage payments. 

Detail : XX/XX/XXXX : Escrow Review Statement from XXXX / MrCooper calculated a {$170.00} surplus on my escrow account, and issued a refund check. This analysis used a wildly inaccurate projection of my property tax liability ( {$1100.00} ) and maintained monthly escrow payments that failed to account for a higher tax bill. 

XX/XX/XXXX : XXXX / MrCooper ( " XXXX '' ) issued another Escrow Review Statement repeating an inaccurate property tax projection and falsely stated ( on XXXX ) that {$1200.00} had already been paid on related property taxes. This statement also used an inaccurate forecast of homeowners insurance policy premiums : {$1200.00} instead of {$1400.00} which was the total of policy premiums paid on the prior year, and which the insurer invoiced XXXX on XX/XX/XXXX. 

XX/XX/XXXX : City of XXXX, MI sent XXXX the tax bill for my property. XXXX reflected an increase in the state equalized value of XXXX, from $ XXXX in XXXX  prior to my purchase, to $ XXXX in XXXX, reflecting the purchase price and assessed value of my property. These values and Michigan property tax schedules are a matter of public record which mortgage lenders are responsible to use when administering consumer escrow accounts. 

XX/XX/XXXX : XXXX issued another Escrow Review Statement which reports XXXX paid property tax bill of {$3800.00} from my escrow account, instead of the {$1100.00} which they had validated in the 2 prior escrow reviews in the 2 preceding months. While XXXX received the tax bill from the XXXX of XXXX more than 30 days prior, the first I learned of this huge discrepancy was when XXXX emailed this statement to me on XX/XX/XXXX. This statement communicated that in 35 days my mortgage payments would spike from {$1100.00} to {$1700.00} ( 45 % increase ) reflecting escrow payments which increased from {$300.00} to {$810.00} ( 168 % increase ). 

XX/XX/XXXX : I called the City to query this tax bill and see if it was legitimate, despite XXXX 's prior calculations. While the bill was correct, I discovered I was entitled to a partial discount through Michigan 's Principal Residence Exemption, which would reduce the {$3800.00} bill by {$620.00}. 

XX/XX/XXXX : I called XXXX / MrCooper and spoke with Agent XXXX verifying when XXXX received my tax bill and querying why I was not notified - prior to them paying it - that the bill was XXXX more than expected. I requested a new calculation of the escrow balance and payments following the City 's application of the Principal Residence Exemption ( PRE ). 

XX/XX/XXXX : I called XXXX and at their instruction I emailed ( to XXXX ) a request to recalculate escrow payments using the reduced tax bill. I attached the City 's confirmation that the PRE was applied to my account. 

XX/XX/XXXX : XXXX issued an Escrow Review Statement which reflected a slight reduction in payments ( {$1600.00} including {$740.00} for escrow ) apparently due to other discrepancies but failing to apply the reduced property tax assessment. 

XX/XX/XXXX : I spoke with a XXXX agent via their web chat to again request that the escrow payments be corrected with the updated tax assessment of {$3200.00}. I was told to again email my request to XXXX, and was promised a response in 7-10 business days. I did so, and again attached the City 's confirmation of this adjustment and provided specific calculations that they should be applying to my escrow payments. 

XX/XX/XXXX : I have not received correspondence or an updated payment schedule. 

ISSUE 2 : XXXX has also mishandled escrow payments for my homeowners insurance policy. XXXX issued 2 checks to the insurer ( XXXX ) on 2 successive days. Then, XXXX notified them of a duplicate payment and sent me a check refunding 1 of the payments made by XXXX. However, XXXX cancelled either both or the wrong one of the checks, and XXXX was thus not paid. Meanwhile, XXXX continues to claim - as recently as the Escrow Review Statement of XX/XX/XXXX - that they paid the {$1400.00} premium out of my account. As a result, XXXX has deducted that amount from my escrow account while XXXX is now sending me notice of non-payment on the policy. 

SUMMARY : On multiple occasions, XXXX / MrCooper has failed to demonstrate competence in the basic administration of mortgage escrow funds, or correcting documented errors in a timely fashion. While I understand that escrow accounts are mandatory for FHA loans, I believe this record - and similar complaints in the CFPB complaint database - suggests XXXX / MrCooper are not fit to continue servicing- and profiting from - these loans. 

In the immediate case, I request CFPB take actions to compel XXXX to a ) recalculate escrow balances and payments into and out of my account with current and accurate information ; b ) amortize over 36 months any payments to bring the escrow balance current, in light of their failure to accurately forecast tax payments ; and c ) communicate to me what they will do to more accurately administer escrow accounts.

Company response to consumer: Closed with explanation