Consumer complaint received 2026-05-18 00:00:00
Product: Mortgage — VA mortgage
Issue: Trouble during payment process — Payment process
Company: Ocwen Financial Corporation
State: CA

Complaint narrative:
This complaint concerns XXXX mortgage account number XXXX, serviced by Onity Mortgage Corporation, formerly PHH Mortgage Corporation. This is not a routine missed-payment complaint. This is a mortgage-servicing, credit-reporting, and foreclosure-escalation complaint arising from Onitys mishandling of approved state disaster-relief mortgage assistance through the XXXX Mortgage Fund. The central harm is that Onity reported, or caused to be reported, a XX/XX/XXXX XXXX-day late mortgage delinquency to XXXX XXXX and XXXX while the loan was already approved for XXXX XXXXisaster-assistance payments, while XXXX funds had already been sent directly to the servicer, and while Onity/PHHs own records show the first {$12000.00} XXXX payment was posted effective XX/XX/XXXX. I also dispute any XX/XX/XXXX negative reporting, rolling delinquency coding, account-status coding, payment-rating coding, derogatory payment history, or continued past-due reporting caused by the same servicing failure. The mortgage was transferred to XXXX effective XX/XX/XXXX. The servicing-transfer notice stated that during the first 60 days following the transfer, no late fees would be assessed and negative credit reporting would not occur. Shortly after that transfer, the loan became part of an approved XXXX Mortgage Fund disaster-assistance payment process. The XXXX Mortgage Fund approved the application on XX/XX/XXXX for up to 12 months of mortgage payment assistance. On XX/XX/XXXX, XXXX notified the borrower that funds had been sent to the mortgage servicer and that XXXX was awaiting confirmation that the servicer had applied the funds. Onity/PHHs own XX/XX/XXXX mortgage statement confirms that a {$12000.00} payment was posted on XX/XX/XXXX with a received/credited date of XX/XX/XXXX. The statement shows that the payment was applied across principal, interest, and escrow. However, despite the funds being sent by XXXX and despite Onity/PHHs own statement showing the payment posted effective XX/XX/XXXX, XXXX did not receive servicer confirmation until XX/XX/XXXX, approximately 34 days after the funds were sent. That delay is material. XXXX is a California disaster mortgage-assistance program that pays approved mortgage assistance directly to the servicer in cycles. Onitys delayed confirmation appears to have interrupted or delayed the next XXXX XXXXayment cycle and caused the account to appear past due for XX/XX/XXXX. Instead of treating the matter as a state-assistance payment-processing and servicer-confirmation issue, Onity treated the account as a borrower-caused delinquency. Onity then furnished, maintained, or failed to correct a XX/XX/XXXX XXXX late mortgage delinquency even though the account status was materially incomplete and misleading. The reporting did not accurately reflect the approved XXXX assistance, the direct state disbursement to the servicer, Onity/PHHs own XX/XX/XXXX effective credit date, or Onitys role in delaying confirmation back to XXXX. The XX/XX/XXXX XXXX late reporting is inaccurate, incomplete, and materially misleading under the Fair Credit Reporting Act and Regulation V. The account continued to escalate despite the active XXXX payment process. The XX/XX/XXXX mortgage statement showed the account due for the XX/XX/XXXX payment and included a {$50.00} assessed expense/inspection fee. The XX/XX/XXXX mortgage statement stated that the account was XXXX payments behind, showed past-due payments of {$8100.00}, assessed a {$110.00} late fee, and continued carrying the {$50.00} assessed expense. On XX/XX/XXXX, Onity issued a Notice of Default/Demand Notice claiming the next payment due date was XX/XX/XXXX, claiming XXXX monthly payments were due, and demanding {$8300.00} to cure default. XXXX then stated on XX/XX/XXXX that another {$12000.00} payment had been applied to the mortgage by the servicer. Despite that state-program confirmation, Onitys account records/online ledger did not visibly reflect that payment as properly applied to cure the alleged delinquency. XXXX day later, on XX/XX/XXXX, Onity issued an Initial Contact Letter required under California XXXX XXXX XXXX, a foreclosure-related pre-notice communication, while approved state disaster-relief mortgage assistance remained active, unresolved, and unreconciled. These facts implicate RESPA Regulation X, including XXXX C.F.R. XXXX ( b ) ( XXXX ), ( b ) ( XXXX ), ( b ) ( XXXX ), and ( b ) ( XXXX ), because Onity failed to properly accept, apply, credit, reconcile, investigate, and correct mortgage servicing errors after XXXX disaster-assistance payments were sent and/or applied. The facts also implicate XXXX C.F.R. XXXX because Onity must provide a complete servicing explanation and records concerning payment application, suspense accounting, XXXX XXXX, credit reporting, default status, foreclosure suppression, and payment-cycle reconciliation. These facts also implicate the Fair Credit Reporting Act, including XXXX XXXX. XXXX ( b ), and XXXX XXXX, because Onity furnished, maintained, or failed to correct XX/XX/XXXX and potentially XX/XX/XXXX negative credit reporting that was inaccurate, incomplete, and materially misleading in light of the approved XXXX disaster-assistance program, direct state disbursement to the servicer, and Onity/PHHs own payment-posting records XXXX These facts also implicate California Homeowner Bill of Rights protections, including California XXXX XXXX XXXX and XXXX, because Onity issued default and pre-foreclosure-related notices while approved state mortgage-assistance funds were active, pending, or unreconciled. These facts also require review under California disaster mortgage-protection law, including XXXX XXXX protections to the extent applicable, because the disputed XX/XX/XXXX and possible XX/XX/XXXX negative credit reporting occurred while disaster-related mortgage payment assistance was active and being paid directly to the servicer. Onitys conduct created a false and damaging account narrative : state disaster-assistance funds were approved, sent, and posted, yet Onity treated the account as delinquent, reported a XXXXday late mortgage event, assessed late/default/inspection fees, issued default notices, and moved into foreclosure-related California contact procedures. Onity should not be permitted to manufacture, preserve, or report a delinquency caused by its own XXXX payment-handling and portal-confirmation failures.

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