Consumer complaint received 2025-07-30 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: PENNYMAC LOAN SERVICES, LLC.
State: AR

Complaint narrative:
In XXXX my mortgage payments went up XXXX XXXX with no advance notice. The payments went from {$1000.00} to {$1400.00}. When I called and inquired about the increase, I was informed that a rise in my insurance " automatically triggered fees '' for managing my escrow. When going over these " fees '' I learned I was being charged monthly for things I had not authorized. I at that time stated I wanted to close my escrow. I was informed that in order to do so I would need to cancel my insurance and obtain my own coverage. I was advised that once I did so, I would need to upload proof of the policy to the Pennymac website ( I have this recorded ). I was instructed that I would have to pay {$1200.00} to zero out a shortage on the escrow account in order to close it. I was advised that after zeroing out the shortage and obtaining my own insurance my total monthly payment would be {$750.00}. I attempted to pay my monthly payment and the shortage multiple times over about a XXXX week period. I spent hours on the phone with Pennymac trying to resolve this. I obtained a new insurance policy through XXXX ( effective XX/XX/XXXX ) and canceled the policy through XXXX ( ending XX/XX/XXXX ). Pennymac kept telling me it would " take another day or XXXX '' to get everything in order. I uploaded my new policy information from XXXX to the Pennymac website, as I was instructed by the Pennymac rep. When I called XXXX days later, I was advised that they had cut a check to XXXX XXXX for the annual cost of the plan, which I had already paid XXXX for the policy. They said that created an additional shortage I would have to pay. After multiple more hours on the phone, I was told that the check hadn't left their facility yet and they would pull it and cancel it ( I have this recorded ). They said they would call me the following day to confirm. The following day they called and advised they were unable to pull it " because it was in a group with other checks '' so they called XXXX and requested reimbursement once received. They told me they would have to wait until that reimbursement was received until they could move forward. I again requested a XXXX contact me, as my payment was going to show as late or missed. 

After finally threatening to sue the company, I was told that a supervisor would give me a call. I was also told that I am not allowed to record conversations I have with the company ( I have their representative recorded saying this multiple times ) even after I explained that I am in Arkansas, which is a one-party consent state. I do have my calls recorded. XXXX days later a supervisor did finally reach out to me. She advised that at this point, my account would have qualified for closing my escrow, but that I had a payment over 30 days late. She was referring to the current payment, which as of the time of my call with her, was 1 day over 30 days late when I had been attempting to pay it for the past few weeks. After talking with her over a couple day period, she stated that she would take the payment for the shortage in the escrow and the payment for the full payment of the XXXX payment ( which I agreed to because the old insurance was still active during that month ) and that she would then resubmit my appeal for closing my escrow. She promised she would personally call me back that Friday to advise me of the outcome. I told her I just wanted to make sure that it wasn't going to run over into another " late payment ''. She said that she would call to make sure. She called later that evening and confirmed she would call me in a few days. I never received a call back from her. I called multiple times and was told she was " busy ''. Eventully another rep told me that a " letter had been scheduled to go out on the XXXX ( of XXXX at this point ) advising of the determination of closing the escrow ''. She said that at that point I would be able to move forward with everything. I asked her to verify if they were closing it, and she said that I would have to wait for the letter, but that my account showed it was eligible to close the escrow ( I have this call recorded ). I just went online to view the letter and it was a denial citing the following reasons : 1 ) One or more 30 day deliquncy in the prior XXXX  months.

2 ) The escrow balance on your loan is negative 3 ) Minimum current and/or original loan to value ( LTV ) ratio was not met 4 ) Minimum FICO score was not met To address these points ; 1 ) I have had this mortgage for XXXX years with no missed or late payments. The first and only late payment was caused by Pennymac delaying this process for weeks. I attempted to pay the total shortage and mortgage payment over a dozen times on the phone over the prior weeks leading up to the account showing 1 day over the late period. 

XXXX ) The escrow balance is negative due to the extra ( unauthorized ) insurance check being sent to XXXX by Pennymac. This was their error and they stated they have already arranged reimbursement with XXXX. I have already paid my XXXX policy out of pocket. I also received a refund check from the old insurance company, which I have not cashed and have offered numerous times to provide to Pennymac. If they would advise what amount is still negative ( minus the new check they wrote to XXXX ), I would be more than happy to pay that immediately. 

XXXX ) My loan has {$150000.00} remaining. My last appraisal was around XXXX XXXXXXXX. It more than qualifies. It also qualified to have the mortgage insurance dropped a year ago. This claim is absolutely ridiculous.

4 ) My FICO score now is higher than it was when I got the original loan. It has also been affected by Pennymac stating I now have a " late payment '' even though I have recordings of myself trying to pay it numerous times over the prior weeks. 

I was told I could wait to make any further payments until this matter was resolved ( recorded ). I will make a payment for the actual amount owed for XXXX today ( {$750.00} ) but I will not pay for an insurance policy that has already been canceled and I will not pay for another insurance policy that I have already paid the provider directly. I have already paid the shortages to a XXXX balance ( other than their check they erroneously cut and have arranged reimbursement that I am not a party to ). I will no longer pay their " fees '' for handling the escrow. At this point I will take this to litigation if not resolved immediately. I have already ( at the instruction of Pennymac ) obtained and paid for a new insurance policy independently. I have already cancelled the old insurance policy. I have already paid the shortages on the escrow. The only " valid '' reason for denial is the " late payment '' which was caused by Pennymac themselves. They are attempting to force me to stay in escrow just so they can collect fees. This is an absolutely scam of a company.

Company response to consumer: Closed with explanation