Consumer complaint received 2025-12-01 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Village Capital & Investment LLC
State: SC

Complaint narrative:
I have an FHA-insured mortgage with Village Capital & Investment LLC . The servicer has demonstrated gross negligence and willful non-compliance with RESPA ( Regulation X ) and HUD Handbook 4000.1 by failing to pay property taxes from my escrow account, resulting in my home being sold at a tax sale. 

Timeline of Events : 1. Negligent Escrow Analysis ( XX/XX/XXXX ) : The servicer conducted an annual escrow analysis. Their own records showed they had budgeted approx. {$6100.00} for my XXXX property taxes. However, the analysis showed they actually paid only {$360.00}. Instead of investigating this massive 94 % discrepancy ( caused by them paying the wrong parcel number ), they negligently treated it as a " surplus. '' They claim to have mailed a surplus check for {$2900.00}, which I never received or cashed. 

2. Borrower Forced to Pay Taxes ( XX/XX/XXXX ) : Because the servicer failed to pay the correct tax bill, my property taxes became delinquent. To prevent a tax lien, I paid {$8400.00} directly to the county tax collector from my personal funds. At the time, I was unaware that under 24 C.F.R. 203.550 ( a ), the FHA servicer was legally responsible for correcting this error and making the payment. 

3. Second Failure & Seizure Notice ( XX/XX/XXXX ) : The servicer failed to correct their records for the XXXX tax year. They continued to budget for the incorrect ~ {$370.00} tax amount. As a result, the XXXX taxes went unpaid. On XX/XX/XXXX, I received a " Delinquent Tax Sale Seized Notice '' posted on the property, stating the home would be sold if payment was not made. 

4. Notice of Error Ignored ( XX/XX/XXXX ) : I sent a formal " Notice of Error '' to the servicer via email, attaching the Seizure Notice and the receipt for my previous {$8400.00} payment. I cited their obligation under RESPA to pay taxes and demanded they pay the current bill and reimburse me for the previous year. 

5. Property Sold at Tax Sale ( XX/XX/XXXX ) : Despite my warnings, the servicer failed to pay the taxes by the deadline. The property was sold at a tax sale. In a letter dated XX/XX/XXXX, the servicer admitted that the county is now " actively working to void the tax sale, '' confirming the sale did occur due to their negligence. 

6. Current Status & Refusal to Reimburse : The servicer has refused to reimburse the {$8400.00} I paid to save the property. 

They justify this denial by claiming they sent the " surplus '' check in XXXX. However, that check was based on their own accounting error, and I never cashed it. 

They are now reporting a fictitious escrow shortage of over {$10000.00}. This shortage is composed entirely of back-taxes they failed to collect and penalties caused by their late payments. 

Their current system still projects an incorrect tax amount for XXXX ( approx. {$370.00} instead of the actual ~ {$2400.00} ), proving the error is ongoing. 

Violations Cited : 12 C.F.R. 1024.17 ( k ) : Failure to make timely disbursements from the escrow account. 

12 C.F.R. 1024.35 ( b ) ( 4 ) : Failure to pay taxes constitutes a " servicing error. '' 12 C.F.R. 1024.17 ( c ) ( 7 ) : Negligent escrow analysis ( ignoring known tax liabilities ).

Company response to consumer: Closed with explanation