Consumer complaint received 2024-10-02 00:00:00
Product: Mortgage — FHA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — Negative impact of inaccurate appraisal
Company: SELECT PORTFOLIO SERVICING, INC.
State: CA

Complaint narrative:
The complainant, XXXX XXXX, can not find a buyer to his home due to XXXX XXXX too close to the home permanently closed outside the only entrance to the Basement. The home also sustained Basement damages to the structural integrity of the home above ground level. The home can not pass inspection for sale except improved. 
XX/XX/XXXX. XXXX, Case XXXX XXXXXXXX, the XXXX XXXX XXXX XXXX XXXXXXXX referred the matter to the XXXX XXXX XXXX of Supervisors to come up with a proposal finding cost to improve the Basement damages for repairs. 
XX/XX/XXXX, XXXX XXXX XXXX XXXX XXXX convened a Quasi Adjudication findings. In attendance were XXXX XXXX XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX, XXXX XXXX XXXX XXXXXXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXXXXXX XXXX XXXX XXXX XXXXXXXX. The mortgage Company and Insurance force- placed on the home did not attend even though they were notified. XXXX XXXX presented an estimate for {$500000.00} to improve the home. The Board did not accept, however, tasked XXXX XXXX inspectors to visit the home, enter the home report findings. 
XX/XX/XXXX, XXXX XXXX inspector headed by XXXX XXXX entered the home and conducted inspection and reported findings to the XXXX. 
XX/XX/XXXX, the XXXX concluded in their findings and concluded reported improvement cost {$460000.00}. The mortgage company in the forced placed insurance of {$850000.00} since XXXX has enough funds for improvement instead asked XXXX, XXXX XXXX to apply for XXXX XXXX coverage which will be a false claim against the XXXX when such condition does not exist. 
Finally on XXXX XXXX the mortgage company released coverage and asked the complainant to go through own insurance companyXXXX XXXX XXXXXXXX XXXX XXXXompany . The Complainant provided an estimated Engineer estimate of {$560000.00} which is higher than XXXX XXXX. The insurer has the duty to send its own Engineer estimate cost can still repair the home less XXXX XXXX recommended improvement brings home to code and compliance. Complainant wants to remain in his home and has XXXX  children still paying his mortgage.The insurance company came and took pictures and denied claims. 
The lender wants property adequately insured so it should mandate repairs to address potential risks like structural issues, electrical problems, or outdated plumbing before providing new force-placed insurance. Under these circumstances, Lender is related to the insurer. These rules can apply to these transactions and are designed to prevent a debtor Mortgage holder insurer from getting around the typical debt forgiveness rules by having the creditor transfer the debt to a related person of the debtor. XXXX XXXX is eligible for principal reduction and also requested that CFPB resolve the matter. 
XXXX XXXX will continue making his payment as required under the law pending the resolution of the matter.

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