Consumer complaint received 2024-06-09 00:00:00
Product: Mortgage — Home equity loan or line of credit (HELOC)
Issue: Struggling to pay mortgage — An existing modification, forbearance plan, short sale, or other loss mitigation relief
Company: NAVY FEDERAL CREDIT UNION
State: VA

Complaint narrative:
A 6-month forebearance under the Cares Act started XXXX of XXXX and ended XXXX of XXXX for my HELOC with Navy Federal Credit Union XXXX XX/XX/XXXX a 6-month repayment plan was offered by NFCU which provided the amount of {$330.00} to be applied to CURRENT mortage payments beginning XX/XX/XXXX with a SUPPLEMENTAL amount of {$190.00} to be applied to prior mortgage payments due during the forebearance ( XXXX XXXX XXXX  ). Payments were made by me in both amounts for each month of XX/XX/XXXX through XX/XX/XXXX. Only 1 notice was received for this replayment plan via electronic message from NFCU dated XX/XX/XXXX outlining the plan ( attached ). The online account never reflected the specific amounts paid each month but did show the dates of payment. The online account continued to show delinquent status with payment dating back to XX/XX/XXXX being due. The total balance of the HELOC did decrease during this time. No written statements or accounting were previously received by mail or electronic message. Given the delinquent status, the only method of payment that could be made was through phone contact with NFCU using their automated phone system for payment. The only way to verify payment was completed was to contact the bank from which I transferred funds ( Capital One ) and verify NFCU accepted the transfer on their end, which they failed to do for the supplemental payment made in XXXX of XXXX so this amount was added to XXXX 's payments, which NFCU now declares broke the repayment plan. 
A Notice of Default and Intent to Accelerate dated XX/XX/XXXX was received via us mail from NCFU indicating payment had not been received dating back to XX/XX/XXXX including late charges, fees and other costs listing the total delinquency and reinstatement amount of {$1300.00} being due immediately. NFCU declared if the deliquency is not paid by XX/XX/XXXX, they will take steps to accelerate the maturity date of the acount, declare the total balance immediately due and payable and terminate ownership in the property by a foreclosure proceeding including filing the Notice of Default in the land records or other action to seize the property. The primary mortgage on the property is held by the United States Department of Agriculture. 
Phone calls by NFCU during the last 6 months were received in which they requested to settle the outstanding payment. Each time I spoke with the NFCU representatives during this time, they acknowledged payments were being made but could not verify the amounts being paid and could not provide a current accounting as to how they had been applied to the HELOC. They denied knowledge of the repayment plan during these calls. I was told to continue the repayment plan, though, as directed and a manager or supervisor would call me back. A call back from management was never received. 
On XX/XX/XXXX, I spoke again with a representative with NFCU and advised them that I must receive an accounting of the payments I had been making under the repayment plan established by NFCU and must get an explanation as to how these payments were applied given the default notice I received. The representative spoke with a supervisor for some time and returned stating the payments would need to be reviewed as there may have been payments applied in error to principle that should have been applied to amounts due in XXXX. A call back appointment was scheduled for XX/XX/XXXX at XXXX XXXX XXXXrom the supervisor. When no call was received back from NFCU on XX/XX/XXXX, I called them and spoke with a manager who indicated that the account would have to be submitted for payment review, which had not been done, and that I was in default by my own inability to understand the payment plan and make the appropriate payment amounts. To support this statement, the manger submitted via electronic message another copy of the repayment plan letter of XX/XX/XXXX and an accounting of what she claimed was displayed online for the account since XX/XX/XXXX, which still did not reflect the actual payment amounts I made and was expanded to clearly show ALL of the payments were going to the past due balance and/or principle and none were reflected as current monthly payments. I was promised a call back in another week with the results of the payment review they be would be conducting There was no contact received back from NFCU on the matter. I called again on XX/XX/XXXX and spoke with a representative who acknowledged only some of the payments made by me in the last 6 months. She insisted that proper processing of the payments was done by NFCU and that all payments were applied to past due balance as a standard policy. The account shows as paid through XXXX of XXXX only. 
The NFCU representative refused to acknowledge the repayment plan notice sent to me as it is written for CURRENT payments and SUPPLEMENTAL payments for past due balance. The representative insisted all payments received, regardless of any plan for repayment, are always applied to any past due balance first. The representative could not explain how the repayment plan would have repaid the past due balance in full in the 6 months time allotted as the SUPPLEMENTAL amount is only half a complete monthly payment. Nor could they explain how 6 CURRENT payments plus SUPPLEMENTAL payments leave the account 6 months delinquent. By their own handling of the funds, only 3 months should remain due. 
The only alternatives NFCU has offered to keep this HELOC out of default and foreclosure is either a new repayment plan, which they can not guarantee will be handled any differently OR a modification of the HELOC to a fixed-rate loan with the balance due from XXXX to XX/XX/XXXX plus fees and costs to be added to the outstanding balance of {$30000.00}. This will leave me without use of the equity in my home and with a monthly payment that does not decrease as it would when repaying it as a HELOC. 
NFCU has failed in providing clear accounting of the repayment plan, misapplied payments, failed to account for 3 months of payments, failed to communicate with me as promised and seems insistent on either foreclosing on my home or at minimum denying me use of my equity in the home.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation