Consumer complaint received 2025-02-26 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Mr. Cooper Group Inc.
State: MN

Complaint narrative:
I tried to submit this letter to Mr Cooper via their online portal, however, the " Send '' button in their message center remains inoperable. It has been this way for years. So, I am filing it as a formal complaint : Date : XX/XX/XXXX XXXX XXXX XXXX Department To Whom It May Concern, I am writing to formally address a series of discrepancies and issues related to my mortgage and escrow accounts that have persisted for the past year. These matters require immediate attention, particularly in light of the recent notification regarding a proposed increase in my monthly mortgage payment to {$4600.00}, effective XX/XX/XXXX, purportedly to cover an alleged escrow shortage of {$5800.00}. Upon thorough review, I find these changes to be unjustified and request prompt rectification. 

**Escrow Discrepancies and Unjustified Payment Increase : ** The proposed increase in my payment appears to stem from a miscalculation of my escrow account. Specifically, the claimed shortage of {$5800.00} can not be reasonably attributed to an increase in property taxes or hazard insurance. The projected increase in property taxes for XXXX is a modest {$400.00}, and my hazard insurance premiums have remained stable. Consequently, the significant shortage seems to result from errors in the management of my account, and I am requesting a comprehensive accounting of these discrepancies. 

**Escrow Mismanagement and Default Advice : ** I must also address a critical issue that has contributed to the confusion and financial strain my family has experienced. In XX/XX/XXXX, I was advised by a representative from your organization to place my account in default to qualify for a loan restructure due to a medical hardship. This guidance was not only misguided but has also led to further complications in my account. Following the default, I was later informed of a surplus in my escrow account, raising additional concerns about the accuracy of the calculations. This surplus, coupled with the current alleged shortage, indicates a lack of proper management of my account. 

The ongoing interactions with Mr. Cooper have caused significant stress for my family, resulting in financial instability and necessitating time away from my family to audit my mortgages escrow account. Our two-year plan to maintain good credit and refinance our loan is now jeopardized due to the adverse impact on our credit score, as well as maintaining timely payments. Numerous instances should have prompted immediate red flags for Mr. Cooper to investigate further. 

The last communication I had regarding the mismanagement of my escrow account and taxes was in XX/XX/XXXX, during which I spent over an hour discussing the issues. At the conclusion of that call, I requested an escalation for a full investigation. The representative assured me that the matter would be escalated to upper management. However, upon checking my online portal last week, I found no messages or updates regarding this investigation. I subsequently engaged with an online agent, asking multiple times whether my account had been escalated. Despite my insistence for a straightforward Yes or No response, the agent only reiterated the proposed increase in my monthly payment, failing to confirm whether my request for an internal investigation had been initiated. It became evident that no action had been taken regarding my demand for a full account investigation. 

At this juncture, I have decided that I can no longer tolerate the negligence and avoidance exhibited by Mr. Cooper. I have filed a complaint with the Better Business Bureau and consulted with an attorney who has successfully litigated against Mr. Cooper on multiple occasions. This attorney is currently verifying the accuracy of the audit I conducted on our escrow account. Should the numerous mismanagement issues remain unresolved, and if Mr. Cooper is unwilling to assist in restructuring payments to alleviate our situation, I will be compelled to pursue legal action. 



Request for Immediate Review and Adjustment : In light of the above, I am requesting the following actions : - A thorough review of my escrow account, specifically regarding the {$5800.00} shortage, with a detailed explanation of its origin. 
- A recalculation of my monthly mortgage payment to ensure that it accurately reflects only legitimate changes in property taxes and hazard insurance. 
- Clarification and resolution of the previous advice to place my account in default, as well as the handling of my escrow surplus and shortage. 
As a customer of Mr. Cooper, I believe it is reasonable to expect that my mortgage servicer ensures the accuracy of all account transactions and properly manages my escrow account. This situation has caused considerable financial strain, as well as unnecessary stress for my family, and I trust that Mr. Cooper will take the necessary steps to resolve these issues promptly. 

I respectfully request a written response within XXXX business days outlining the corrective actions Mr. Cooper will take to resolve these discrepancies. If this matter is not addressed in a timely and satisfactory manner, I will be pursuing legal recourse to ensure that my account is accurately managed and the errors are rectified. 

I appreciate your attention to this matter and look forward to your prompt response. 


-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- - Timeline of Events and Issues Relating to Property Tax, Escrow Account Management, and Loan Default : XX/XX/XXXX : Home Closing : Original Mortgage Provider : XXXX XXXX XXXX XXXX XXXX XXXX. 
XXXX XXXX : A payment of {$1700.00} was deposited into escrow at closing as a cushion for anticipated XXXX property taxes, as specified in the closing documents. 
XXXX XXXX XXXX : All XXXX property taxes were fully paid up to date prior to closing, with no outstanding balances. 

XX/XX/XXXX : Mortgage Transfer to Mr. Cooper Mortgage Transfer : XXXX XXXX XXXX XXXX XXXX XXXX sold the mortgage loan to Mr. Cooper. 

Notification Issue : XXXX XXXX was not promptly notified of the mortgage transfer, and as a result, the initial XXXX property tax bills were sent to XXXX. 
Forwarding Failure : XXXX did not forward these tax bills or relevant information to Mr. Cooper, which contributed to delays and mismanagement of property tax payments. 
XX/XX/XXXX : Initial Contact Regarding Loan Hardship Program Loan Hardship Inquiry : Due to significant medical expenses, I contacted Mr. Cooper to inquire about possible temporary hardship programs or options for loan restructuring, including deferring payments or lowering monthly payments temporarily. 
Advice Received : A representative from Mr. Cooper advised that we were not in default, so we did not qualify for a loan restructure. The representative suggested putting the loan into default to potentially qualify for a restructuring in XX/XX/XXXX. I was advised to allow the loan to go into default to qualify for assistance, which I agreed to, relying on the advice given. 

Negligent Advice : This advice turned out to be deeply flawed. As I later discovered, putting the loan into default would risk losing our home, and the restructuring was not a feasible option under these circumstances. In XX/XX/XXXX, I was informed by a different representative that the original advice was erroneous and could not have led to a loan restructure. The representative further indicated that no hardship restructuring could be offered. 

Request for Investigation : I requested that Mr. Cooper conduct an internal investigation into the original advice provided, and it was confirmed that the representative 's guidance was negligent. The representative was reportedly retrained, and I was told that I should work to bring the loan current to avoid foreclosure, which negatively impacted our credit scores. 

XX/XX/XXXX : Loan Default and Escrow Analysis Loan Default : After following the advice of the earlier representative, we found ourselves in default. Mr. Cooper insisted that we catch up on missed payments or risk foreclosure, but no assistance was offered to move these payments to the end of the loan, or help in any way aside from waiving a few of the late fees they added to our account. 
Escrow Analysis and Surplus Creation : In XX/XX/XXXX, I was informed by Mr. Cooper that an escrow surplus of {$1900.00} had been identified due to a decrease in property taxes. The escrow analysis was based on an incorrect tax bill of {$520.00}. 

Escrow Payment Adjustment : As a result of the incorrect bill, my escrow payments were reduced to {$88.00} per month, which was significantly lower than required for the actual property tax liability of {$4200.00}. 

XX/XX/XXXX : Property Tax Bills Issued by XXXX XXXX XXXX XXXX XXXX XXXX : XXXX XXXX issued two separate property tax bills on XX/XX/XXXX : Correct Bill : A bill for {$4200.00} for the full amount of XXXX property taxes. 
Incorrect Bill : A bill for {$520.00}, which was due to an error by XXXX XXXX. This was not a valid bill as there were no outstanding taxes from XXXX. 

Escrow Analysis Error : Despite receiving both the correct and incorrect tax bills, Mr. Cooper used the erroneous {$520.00} bill for the escrow analysis in XX/XX/XXXX, which led to discrepancies in the escrow account and an incorrect reduction in monthly payments. 
XX/XX/XXXX : Notice from XXXX XXXX Regarding Unpaid Taxes Property Tax Delinquency : In XX/XX/XXXX, I received a notice from XXXX XXXX informing me that no payments had been received for XXXX property taxes and the account was considered delinquent. 

- Confirmation of XXXX XXXX : XXXX XXXX confirmed the total amount due for XXXX property taxes as {$4200.00}, with no outstanding payments from XXXX XXXX escrow account. XXXX XXXX also was able to provide me with documents that they sent to Mr Cooper, which included a copy of the only check they received from them in XXXX of XXXX, as well as their Property Tax Estimates for XXXX, XXXX, and XXXX. Mr Cooper had all of the necessary information to apply appropriately to our escrow. 

- XX/XX/XXXX : Property Tax Payment and Disbursement Issues Tax Payment Processing : A payment of {$4200.00} was made from XXXX XXXX escrow account on XX/XX/XXXX, but the payment was recorded by XXXX XXXX on XX/XX/XXXX. 

- Escrow Account Date Error : The payment was listed as being disbursed in XX/XX/XXXX in XXXX XXXX escrow records, but the payment was processed by XXXX XXXX in XX/XX/XXXX. 

- Reversal of Erroneous Payment : The {$520.00} erroneous tax bill from XXXX XXXX was reversed, but the corresponding funds were never returned to the escrow account. The discrepancy between the amount paid and the amount recorded in the escrow account is unclear. 

- XXXX Hazard Insurance Payment Disbursements Insurance Payment : A payment of {$340.00} was made to Universal for hazard insurance on XX/XX/XXXX. 

- Delayed Insurance Payments : The next payment to XXXX was not made until XX/XX/XXXX, when a large lump-sum payment of {$3900.00} was disbursed to cover the remaining balance of the hazard insurance premium. 

- Irregular Payment Schedule : Mr. Cooper failed to allocate regular monthly payments to hazard insurance, leading to a large year-end lump-sum disbursement instead of consistent monthly payments as outlined in the escrow agreement. 

Ongoing Issues with Escrow and Communication - Escrow Mismanagement : The use of an incorrect property tax bill for the XX/XX/XXXX escrow analysis and subsequent reduction in monthly payments resulted in an escrow surplus and significant discrepancies in the account balance. 

- Failure to Address Communication Gaps : Throughout this process, Mr. Cooper failed to provide clear, timely, or accurate updates regarding property tax payments, the transfer of the mortgage, and escrow account management. 

- Inadequate Resolution of Errors : Despite multiple attempts ( on my part ) by reaching out to Mr Cooper to resolve issues and provide supporting documentation, there has been no satisfactory explanation or correction of the mismanagement of funds. 

- Summary of Financial Discrepancies- {$520.00} : This amount refers to the erroneous property tax bill issued by XXXX XXXX. It was later reversed, but the reversed funds were not returned to the escrow account, creating a discrepancy in the account balance. 

- {$4200.00} : The total property tax payment for XXXX. The discrepancy between XXXX XXXX XXXX and the actual payment processing date needs clarification. 
Hazard Insurance Payments : The irregular payment schedule for hazard insurance, including a large lump-sum disbursement in XXXX, deviates from the expected monthly allocations in the escrow agreement. 

- Loan Default and Credit Impact : The negligent advice provided by XXXX XXXX representative to place the loan in default resulted in financial hardship, damaged credit, and an unnecessary risk of foreclosure. 

***Since we are unable to send messages through the Mr Cooper website, a copy of this letter is also being sent to them Certified Mail. ***

Company response to consumer: Closed with explanation