Consumer complaint received 2026-04-06 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Struggling to pay mortgage — Applying for or obtaining a modification, forbearance plan, short sale, or deed-in-lieu
Company: Ocwen Financial Corporation
State: TX

Complaint narrative:
Servicer : Onity Mortgage ( formerly Onity Mortgage Corporation | Loan No. XXXX Property : XXXX XXXX XXXX, XXXX, TX XXXX | Investor : XXXX XXXX XXXX XXXX Escalation Case : XXXX ( opened XX/XX/XXXX active ) On XX/XX/XXXX, I contacted PHH Mortgage Services ( now Onity Mortgage ) to request a 3-month payment deferral for XX/XX/XXXX, XX/XX/XXXX, and XX/XX/XXXX. The hardship is medical my husband XXXX XXXX was XXXX XXXX XXXX XXXX and is undergoing treatment at XXXX XXXX XXXX XXXX XXXX XXXX, Texas. I committed to resume regular monthly payments in XX/XX/XXXX. Borrower payment history and proactive conduct : This account has a prior successful loan modification executed XX/XX/XXXX, approved by XXXX XXXX as investor, which deferred {$100000.00} to the back of the loan ( confirmed on the XXXX XXXX XXXX monthly statement ). Following that modification, we made every monthly payment on time from XX/XX/XXXX through XX/XX/XXXX XXXX consecutive timely payments. When XXXX XXXX XXXX XXXXXXXX XXXX made a XX/XX/XXXX hardship imminent, I proactively contacted PHH before any payment was missed and immediately requested a temporary XXXX deferral of XX/XX/XXXX, XX/XX/XXXX, and XX/XX/XXXX with a commitment to resume payments in XX/XX/XXXX. Applicable XXXX XXXX XXXX XXXX relevant to this request : Payment deferral eligibility ( XXXX XXXX XXXX, XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXXXXXX deferral availability to borrowers 60180 days delinquent. As of XXXX XXXX, borrowers are no longer required to make consecutive monthly payments prior to completing a payment deferral. Our delinquency at time of complete application ( XX/XX/XXXX ) was squarely within the XXXX day window. Cumulative deferral cap ( XXXX XXXX XXXX ( a ) ) : XXXX XXXX limits cumulative deferred P & I payments to 12 months. If the prior XX/XX/XXXX modification already exhausted this limit, that is a specific, communicable reason which Onity was required to disclose under 12 CFR 1024.41 ( d ). 'Investor guidelines ' without naming this specific provision is not compliant disclosure. Servicer evaluation hierarchy ( Flex Modification Reference Guide ) : Even if payment deferral was unavailable due to the cumulative cap, XXXX XXXX requires servicers to evaluate borrowers for all options in the loss mitigation hierarchy including forbearance and Flex Modification before issuing a denial. Onity did not disclose which options were evaluated and why each was denied. No blanket prohibition on second modification : XXXX XXXX guidelines permit subsequent modifications for borrowers who successfully completed a prior modification ( unlike borrowers who failed a XXXX XXXX XXXX, which does trigger a XXXX bar ). We successfully completed the XX/XX/XXXX modification and made eight consecutive on-time payments. Servicer mandatory evaluation obligation ( Guide Section 9206.1 ) : When a borrower is between 90105 days delinquent, XXXX XXXX requires servicers to proactively review for XXXX XXXX eligibility and send a trial plan offer if eligible. Onity did not disclose whether this mandatory review occurred. VIOLATION 1 PREMATURE NOD / WRONGFUL APPLICATION CANCELLATION 12 CFR 1024.41 ( b ) ( 2 ) I submitted a complete Mortgage Assistance Application on XX/XX/XXXX XXXX days before the XX/XX/XXXX deadline. PHH representative XXXX ( ID : XXXX ) confirmed on XX/XX/XXXX that all documents were received, under underwriting review, with a XXXX window. On approximately XX/XX/XXXX before that window elapsed PHH automatically canceled my application and issued a Notice of Default without contacting me, identifying any deficiency, or giving me any opportunity to cure. When I called XX/XX/XXXX, representative XXXX ( ID : XXXX ) found the issue : clarification needed on bank statements for a $ XXXX tribal income information PHH had XXXX since XX/XX/XXXX. No representative raised this concern during the full month it was in PHH 's possession. PHH failed to notify me of this deficiency before taking adverse action, in direct violation of XXXX XXXX XXXX ( b ) ( XXXX ) ( i ) ( B ). VIOLATION XXXX XXXX XXXX XXXX ACTIVE REVIEW XXXX XXXX XXXX ( f ) PHH issued a Notice of Default while my application was within the active XXXX review window impermissible dual tracking under XXXX XXXX XXXX ( f ). On XX/XX/XXXX, I also received XXXX notification of forthcoming mail from XXXX Onity 's foreclosure processing vendor. PHH representative XXXX ( ID : XXXX ) stated she was unfamiliar with XXXX while XXXX was sending correspondence to a borrower under active loss mitigation review. Most critically : Onity 's own XX/XX/XXXX application-complete letter ( XXXX ) explicitly states : 'Even though foreclosure actions have begun, no foreclosure sale will occur while we evaluate the complete MAA. ' This is Onity 's written confirmation that foreclosure actions were actively underway while simultaneously certifying the application as complete and under protected review. Onity can not certify a protected review and acknowledge active foreclosure in the same letter this is dual tracking documented in Onity 's own correspondence. Prior modification establishes precedent : XXXX XXXX 's BPOdirect system shows this property was evaluated on XX/XX/XXXX in connection with a loan modification request which resulted in a successful loan modification executed XX/XX/XXXX. XXXX XXXX approved that modification and the {$100000.00} deferral now reflected on the XX/XX/XXXX statement. The current denial, citing the same 'investor guidelines ' without specifics, is facially inconsistent with XXXX XXXX XXXX own XX/XX/XXXX approval of a substantially similar accommodation on this account. VIOLATION XXXX RETROACTIVE PAYMENT POLICY WITHOUT NOTICE XXXX XXXX XXXX ( b ) ( XXXX ) On XX/XX/XXXX, PHH representative XXXX ( ID : XXXX ) who Onity 's own XX/XX/XXXX Loss Mitigation Notice identifies as my designated relationship XXXX ( XXXX ID XXXX ' ) instructed me to begin making monthly payments. I complied on XX/XX/XXXX, paying {$3100.00}, confirmed on my XX/XX/XXXX statement. Critical : On XX/XX/XXXX, Onity sent me a Loss Mitigation Notice stating : 'To be eligible, approval from the investor for the account is required which is not yet received by us. ' On that same day without notice to me Onity implemented a new policy requiring accounts XXXX months delinquent to pay a minimum of XXXX months. Onity told me in writing the review was still pending investor approval, while simultaneously changing the financial terms of what I would need to pay. I was not informed of this change in the XX/XX/XXXX letter or any other communication. On XX/XX/XXXX, I attempted my second good-faith monthly payment of {$3100.00}. The system refused it. Representative XXXX ( ID : XXXX ) confirmed no override was available and warned of foreclosure risk starting XX/XX/XXXX. On XX/XX/XXXX, I attempted a two-month payment ( {$6300.00} ) also refused. The minimum is now XXXX months ( {$9500.00} ). Each refusal was caused by Onity 's prior refusal, compounding a delinquency Onity created. Additionally : my XX/XX/XXXX statement shows the loan carries a prior non-interest-bearing deferred balance of {$100000.00} establishing that Onity has previously approved deferral arrangements on this account. Denying a XXXX payment deferral request while carrying a {$100000.00} existing deferral is inconsistent and requires specific justification under XXXX XXXX XXXX XXXX VIOLATION 4 MISSED STATUTORY 30-DAY REVIEW DEADLINE 12 CFR 1024.41 ( c ) ( 1 ) Onity 's own XX/XX/XXXX application-complete letter ( XXXX ) states : XXXX XXXX of the MAA application indicate that it XXXX complete as of XX/XX/XXXX. ' Under 12 CFR 1024.41 ( c ) ( 1 ), Onity was required to complete its review within XXXX calendar days by XX/XX/XXXX. The denial was not issued until XX/XX/XXXX XXXX days past the statutory deadline. Onity 's own XX/XX/XXXX letter ( day XXXX ) acknowledged the investor response was still 'not yet received, ' and Onity 's XX/XX/XXXX delay letter confirmed it was still awaiting XXXX XXXX XXXX response with no stated legal basis for extending the review past the XXXX statutory window. Awaiting investor direction does not toll the regulatory clock. VIOLATION XXXX DENIAL WITHOUT SPECIFIC GROUNDS ; ESCALATING COMPOUNDING PAYMENT BARRIER On XX/XX/XXXX, Onity denied my mortgage assistance application. On XX/XX/XXXX, Onity representative XXXX ( ID : XPR ) confirmed that Onity representatives stated that no specific reason was provided by XXXX XXXX for the denial : XXXX did not the reason for they did now. Didn't give a basically reason. ' Under XXXX CFR XXXX ( d ), Onity must state the specific reason ( XXXX ) for denial a vague reference to 'investor guidelines ' where the investor provided no reason fails this standard entirely. Also on XX/XX/XXXX, I attempted a two-month payment ( {$6300.00} ) the minimum Onity required as of XX/XX/XXXX. XXXX refused it, stating the minimum is now XXXX months ( {$9500.00} ) by XX/XX/XXXX. The minimum payment floor has escalated from 1 month to 2 months to 3 months in 35 days each increase caused by Onity 's own prior refusal. XXXX confirmed the XX/XX/XXXX window is conditional : 'If the account status changes anytime between now and the XXXX, it will then go to foreclosure. ' The window Onity offered is not a protected safe harbor. XXXX XXXX ESCALATION CASE XXXX On XX/XX/XXXX, XXXX XXXX representative XXXX opened XXXX case XXXX to investigate Onity 's conduct. XXXX XXXX confirmed no foreclosure in their system. The denial was issued XX/XX/XXXX XXXX days after the XXXX XXXX case was opened. I am filing this CFPB complaint concurrently with the active XXXX XXXX investigation and in anticipation of a formal written appeal. DESIRED RESOLUTION PRIMARY RELIEF SOUGHT : Borrowers request that Onity Mortgage Corporation be directed to : ( XXXX ) approve the original XXXX payment deferral for XX/XX/XXXX, XX/XX/XXXX, and XX/XX/XXXX, consistent with XXXX XXXX XXXX XXXX deferral program ( Bulletin XXXX, XXXX XXXX XXXX ), which is designed precisely for borrowers in this situation 60180 days delinquent with a documented temporary hardship ; and ( XXXX ) immediately accept a single monthly payment of {$3100.00} and allow borrowers to resume regular monthly payments without the XXXX or XXXX minimum payment barrier created by Onity 's XX/XX/XXXX retroactive XXXX change. These XXXX actions would return the account to current status and fully resolve the hardship which is exactly what borrowers have sought since XX/XX/XXXX. Additional relief requested : I also request that the CFPB require Onity Mortgage to : ( XXXX ) provide a written denial notice stating the SPECIFIC reason ( XXXX ) for denial of each loss mitigation option as required by XXXX XXXX XXXX ( d ) 'investor guidelines ' without specifics is not compliant ; ( XXXX ) acknowledge and explain the XXXX missed statutory review deadline under XXXX XXXX XXXX ( c ) ( XXXX ) application complete XX/XX/XXXX, deadline XX/XX/XXXX, denial issued XX/XX/XXXX ; ( XXXX ) confirm in writing that no foreclosure action will be initiated during the XXXX appeal window and the appeal review period ; ( XXXX ) explain the 'Even though foreclosure actions have begun ' statement in Onity 's own XX/XX/XXXX XXXX letter confirming what foreclosure actions were underway during the protected review period ; ( XXXX ) confirm in writing that the escalating minimum payment policy will not continue to compound during the pending appeal ; ( XXXX ) provide a written explanation of the XX/XX/XXXX NOD who authorized it, what was deficient, and why borrowers were not notified before adverse action was taken ; ( XXXX ) disclose whether XXXX XXXX 's response to Case XXXX XXXX received before the XX/XX/XXXX denial was issued. UPDATES AS OF XX/XX/XXXX DATE NOTICE OF ERROR SUBMITTED TO ONITY Update XXXX Application Denied ( Effective XX/XX/XXXX ) On XX/XX/XXXX, Onity representative XXXX ( ID : AHA ) verbally notified me that my mortgage assistance application has been DENIED, citing only 'investor guidelines and government guidelines ' no specific guideline or deficiency identified. A second call with Onity representative XXXX ( ID : XPR ) the same day confirmed the denial was actually issued XX/XX/XXXX, not XX/XX/XXXX. XXXX further confirmed that XXXX XXXX ( the investor ) provided NO specific reason for the denial to Onity : XXXX did not the reason for they did now. Didn't give a basically reason. ' Under XXXX CFR XXXX ( d ), Onity is required to state the specific reason ( XXXX ) for denial of each loss mitigation option considered. A denial based on investor direction where the investor provided no specific reason fails this requirement. The written denial letter is expected XX/XX/XXXX. If dated XX/XX/XXXX, the XXXX appeal window under XXXX CFR XXXX ( h ) XXXX expire as early as XX/XX/XXXX. This complaint is filed today to preserve all rights prior to that appeal. Update XXXX Escalating Payment Barrier / Conditional Promise to Pay Also on XX/XX/XXXX, I attempted a two-month payment of {$6300.00}. Onity refused. XXXX stated the minimum is now XXXX months ( {$9500.00} ) by XX/XX/XXXX. The minimum payment floor has escalated as follows each increase caused by Onity 's own prior refusal : XX/XX/XXXX : {$3100.00} ( 1 month ) ACCEPTED XX/XX/XXXX : {$3100.00} ( 1 month ) REFUSED ( need 2 months ) XX/XX/XXXX : {$6300.00} ( 2 months ) REFUSED ( need 3 months ) XXXX offered a conditional promise to pay window ( {$9500.00} by XX/XX/XXXX ), but explicitly warned : 'If the account status changes anytime between now and the XXXX, it will then go to foreclosure. ' The window is not guaranteed. This complaint is filed concurrently with a formal Notice of XXXX to Onity and in anticipation of a written appeal to be filed upon receipt of the denial letter. XXXX XXXX escalation case XXXX remains open and active. At all times, borrowers were ready, willing, and able to make their monthly payment. Any escalation of delinquency beyond the initial XXXX hardship period was directly caused by Onity 's XXXX to accept good-faith payments during active review not by borrower non-compliance. Respectfully submitted, XXXX XXXX ( Borrower ) XXXX XXXX XXXX ( Co-Borrower ) XXXX XXXX XXXX, XXXX, TX XXXX XXXX XXXX XXXX XXXX XXXX

Company response to consumer: Closed with explanation