Consumer complaint received 2025-11-18 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Fees charged
Company: Freedom Mortgage Company
State: WI

Complaint narrative:
Company : Freedom Mortgage Corporation Loan Number : XXXX Property Address : XXXX XXXX XXXX, XXXX, WI XXXX Borrower : XXXX XXXX XXXX XXXX : XXXX Email : XXXX Summary of the Problem Freedom Mortgage is misapplying my mortgage payments, taking unauthorized fees, mishandling partial payments, and using the suspense account improperly. This has created false shortages, excessive fees, and incorrect delinquency statuseseven though I pay more than the required amount every month. 

Their servicing errors have led to {$900.00} in fees in a single billing cycle, recurring unexplained fees ( including {$55.00} ), and failure to apply extra funds to principal. 

I have submitted a formal RESPA Qualified Written Request ( QWR ) / Notice of Error demanding an investigation, but I am requesting CFPB intervention due to the severity and ongoing nature of these violations. 

Details of What Happened After an escrow increase, Freedom Mortgage failed to properly apply my payments. Instead of combining my two monthly payments into one full monthly payment, they : Placed nearly every payment into a suspense account Took fees from my payments before applying principal/interest Treated the remaining portion as short Charged recurring {$55.00} short-payment fees Assessed additional expense paid fees Charged late fees despite timely payments Created false shortages that feed more fees Failed to apply any overpayments to principal Because of this improper handling, my account shows : {$900.00} in fees in one statement, Repeated suspense-account activity, Unapplied funds, And payment application errors that violate federal servicing laws.

My Payment Method ( Important Clarification ) I pay my mortgage in two payments each month, roughly half the amount each time. My required monthly payment is {$1300.00}, and I typically pay about {$1400.00} total. 

Under RESPA and Regulation XXXX  Freedom Mortgage is required to : Hold partial payments in suspense, Combine them once they equal a full periodic payment, Apply the full payment to principal, interest, and escrow immediately, NOT charge late fees if the full amount is received within the grace period. 

Freedom Mortgage does not follow this law. 

Instead, they : Pull fees out of the first half-payment, Reduce the amount below a full payment, Leave it in suspense, Treat the payment as short, Charge a fee, Repeat the same cycle with the second payment, Ensure I am never credited with a full payment even though the total amount is paid. 

This creates an artificial delinquency entirely caused by the servicer. 

Additional Issue : I Pay Over the Required Amount Where Is the Extra Money Going? 

Every month, I pay more than my required payment amount. Instead of applying the excess funds to principal, Freedom Mortgage : Diverts the overage into fees, Removes the extra amount before applying the payment, Makes my payment appear short even though I paid more than required, Fails to apply any extra funds to my principal balance, Prevents my account from ever reaching proper paid-through status. 

This behavior is financially harmful and appears to be a deliberate misapplication of overpayments. 

Violations and Servicing Errors Freedom Mortgages conduct appears to violate : RESPA 12 U.S.C. 2605 Regulation XXXX  ( XXXX XXXX XXXX ) Rules governing partial payment handling Rules governing suspense account application Requirements for pre-change escrow notice Rules for proper allocation of overpayments Prohibitions on charging improper or unsupported fees Fair credit reporting requirements This issue is ongoing and has caused significant financial harm. I pay more than required each month, yet Freedom Mortgage : Removes fees before applying payments, Misuses the suspense account, Misapplies partial payments, Creates artificial shortages, Charges unlawful fees, and Fails to credit extra funds to principal. 

I am requesting immediate CFPB intervention to bring my account into compliance and stop Freedom Mortgage from continuing harmful and unlawful servicing practices.

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