Consumer complaint received 2025-04-23 00:00:00
Product: Mortgage — VA mortgage
Issue: Trouble during payment process — Trying to communicate with the company to fix an issue while managing or servicing your loan
Company: PENNYMAC LOAN SERVICES, LLC.
State: TX

Complaint narrative:
I am submitting a complaint against Pennymac, regarding their failure to comply with the Servicemembers Civil Relief Act ( SCRA ) Background information : I served on XXXX  with the XXXX XXXX XXXX XX/XX/XXXX XX/XX/XXXX. I transferred to the XXXX XXXX XXXX XXXX XXXX XXXX XXXX, beginning my service XX/XX/XXXX, and am still serving with the XXXX. 

My wife and I purchased our house on XX/XX/XXXX. I was on XXXX with the XXXX on that date. I returned to XXXX  XXXX  on XX/XX/XXXX. 

Timeline : On XX/XX/XXXX, I began a period of XXXX XXXX, under orders issued under 10 USC 12301 ( b ) for my annual training duty. This period of XXXX XXXX was through XX/XX/XXXX. 

On XX/XX/XXXX, I submitted a copy of my orders to Pennymac via their online messaging platform, requesting SCRA benefits. My intent was to have my mortgage interested rate lowered from 6.75 % to at least 6 % as required by SCRA, beginning on the first day of my XXXX XXXX through 1 year after the last day of my XXXX XXXX 

On XX/XX/XXXX, I received a reply from Pennymac, stating my orders were received and they were considering my request, and I would receive a reply by mail within 10 days. 

On XX/XX/XXXX, I received the letter in the mail. The letter stated they were unable to apply benefits allowed by SCRA because my XXXX XXXX start date originated before my mortgage note date. 

I sent a reply message, clarifying that my orders called me onto XXXX XXXX XX/XX/XXXX XX/XX/XXXX, which was nearly a year after my mortgage note date. ( Note that I made an error in this message, and it should have been XX/XX/XXXX XX/XX/XXXX ). I requested Pennymac review and apply SCRA benefits. 

On XX/XX/XXXX, I received a reply from Pennymac that they had reviewed my orders and were still unable to apply any of the benefits available under SCRA, again stating that my XXXX XXXX start date preceded the date of my mortgage note. Pennymac invited me to send updated military orders if I had any. 

I replied on the same day that the date of my mortgage note wass XX/XX/XXXX. The XXXX start date on my orders was XX/XX/XXXX, which was XXXX  days after the date on my mortgage note. 

On XX/XX/XXXX, I called Pennymac and spoke on the phone with a customer service representative ( CSR ). I explained that I was requesting SCRA benefits, and that I was wrongly denied due to a misinterpretation that my XXXX start date preceded my mortgage note date. The CSR stated she would need to reach out to a different employee for clarification and would call me back within a few hours. 

A few hours later, I received a call back from the CSR, who stated she forwarded my request for SCRA benefits. 

On XX/XX/XXXX, I received a message from Pennymac acknowledging I spoke to a CSR, and that I would receive a response regarding SCRA benefits by mail within the next 10 days. 

On XX/XX/XXXX, I received the letter in the mail. This was a third written notice to me that Pennymac was unable to apply any of the benefits allowed by SCRA because my XXXX start date originated before my mortgage note date. I sent another reply that was factually incorrect, again clarifying my mortgage note date was XX/XX/XXXX, and my XXXX orders were XX/XX/XXXX XX/XX/XXXX. I also notified by XXXX I would be filing a CFPB complaint, and encouraged them to review the orders provided and the applicable law. 

On XX/XX/XXXX, I am writing this complaint and filing it with the CFPB. 

Complaint : Pennymac is not applying the benefits of SCRA to my mortgage as they should under law, namely that a debt incurred prior to a period of XXXX XXXX  must have its interest rate reduced to a maximum of 6 % through the period of XXXX XXXX, and in the case of a mortgage, for XXXX year after the last day of the period of XXXX XXXX 

The Law : SCRA can be found in Chapter 50 of Title 50 of the United States Code ( USC ).

Military service is defined by 50 USC 3911 ( 2 ) ( A ) ( i ) as XXXX XXXX, as defined by 10 USC 101 ( d ) ( 1 ) : The term " XXXX XXXX '' means full-time duty in the XXXX XXXX XXXX  of the United States . Such term includes full-time training duty, annual training duty, and attendance, while in the XXXX XXXX XXXX, at a school designated as a service school by law or by the Secretary of the military department concerned. Such term does not include full-time XXXX XXXX XXXX XXXX 

Period of military service is defined by 50 USC 3911 ( 3 ) : The term " period of military service '' means the period beginning on the date on which a servicemember enters military service and ending on the date on which the servicemember is released from military service or dies while in military service.

50 USC 3917 ( a ) states A member of a reserve component who is ordered to report for military service is entitled to the rights and protections of this subchapter and subchapters II and III during the period beginning on the date of the member 's receipt of the order and ending on the date on which the member reports for military service ( or, if the order is revoked before the member so reports, or the date on which the order is revoked ).

3937. Maximum rate of interest on debts incurred before military service ( a ) Interest rate limitation ( 1 ) Limitation to 6 percent An obligation or liability bearing interest at a rate in excess of 6 percent per year that is incurred by a servicemember, or the servicemember and the servicemember 's spouse jointly, before the servicemember enters military service shall not bear interest at a rate in excess of 6 percent ( A ) during the period of military service and one year thereafter, in the case of an obligation or liability consisting of a mortgage, trust deed, or other security in the nature of a mortgage; or ( B ) during the period of military service, in the case of any other obligation or liability.

( 2 ) Forgiveness of interest in excess of 6 percent Interest at a rate in excess of 6 percent per year that would otherwise be incurred but for the prohibition in paragraph ( 1 ) is forgiven.

( 3 ) Prevention of acceleration of principal The amount of any periodic payment due from a servicemember under the terms of the instrument that created an obligation or liability covered by this section shall be reduced by the amount of the interest forgiven under paragraph ( 2 ) that is allocable to the period for which such payment is made.

( b ) Implementation of limitation ( 1 ) Proof of military service ( A ) In general Not later than 180 days after the date of a servicemember 's termination or release from military service, in order for an obligation or liability of the servicemember to be subject to the interest rate limitation in subsection ( a ), the servicemember shall provide to the creditor written notice and a copy of ( i ) the military orders calling the servicemember to military service and any orders further extending military service; or ( ii ) any other appropriate indicator of military service, including a certified letter from a commanding officer.

( B ) Independent verification by creditor ( i ) In general A creditor may use, in lieu of notice and documentation under subparagraph ( A ), information retrieved from the XXXX XXXX XXXX XXXX through the creditor 's normal business reviews of such Center for purposes of obtaining information indicating that the servicemember is on XXXX XXXX. 
( XXXX ) Safe harbor A creditor that uses the information retrieved from the XXXX XXXX XXXX XXXX under clause ( i ) with respect to a servicemember has not failed to treat the debt of the servicemember in accordance with subsection ( a ) if ( I ) such information indicates that, on the date the creditor retrieves such information, the servicemember is not on XXXX XXXX ; and ( II ) the creditor has not, by the end of the XXXX period under subparagraph ( A ), received the written notice and documentation required under that subparagraph with respect to the servicemember. 
( XXXX ) Limitation effective as of date of order to XXXX XXXX Upon receipt of written notice and a copy of orders calling a servicemember to military service, the creditor shall treat the debt in accordance with subsection ( a ), effective as of the date on which the servicemember is called to military service. 

Under the auspices of the SCRA, I am a servicemember, called to XXXX XXXX for a period of military service this year. I have a mortgage at 6.75 % interest, which was incurred prior to this period of military service, which exceeds the 6 % interest rate cap, and should be reduced and forgiven to that cap. I have provided orders verifying my XXXX XXXX prior to the 180 day limitation. 

Pennymac is required by the SCRA to reduce my interest rate to 6 % or lower retroactively to XX/XX/XXXX, through XX/XX/XXXX.

Company response to consumer: Closed with explanation