Consumer complaint received 2018-06-04 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Struggling to pay mortgage — 
Company: Fay Servicing, LLC
State: NV

Complaint narrative:
I have been a victim of misrepresentation and unethical conduct by XXXX XXXX XXXXXXXX and now Fay Servicing. On two different occasions I was offered a loan modification and on both we accepted the offer and followed through on our end. Due to no fault of our own we were removed from the first modification because XXXX XXXXXXXX XXXX " Lost our paperwork '' and after filing a chapter XXXX bankruptcy and making trustee payments for several years we were offered a second modification. While making the trial payments on the second modification the servicing was transferred to Fay Servicing who refused to honor the modification, even though XXXX XXXX XXXX   sent us a letter that the modification would be honored after the service transfer. This has started a downward spiral and we are now backed into a corner by Fay Servicing because of their misrepresentations and have tried to force us to sign over our home. 

My husband and I bought this home back in XX/XX/XXXX with a loan through XXXX. In order to come up with the down payment we withdrew $ XXXX from our IRA account which led to problems with the IRS. Even though we both had good jobs ( husband a service technician and me accountant ) the IRS problem put us in a tough situation and we defaulted on the mortgage loan. We then applied for and were approved for a loan modification through XXXX XXXX XXXX ( who now owned the loan ). We made our first trial payment but when I tried to make the second modification payment the bank would not accept it. We soon found out that they had " lost our paperwork. '' and received a letter acknowledging the error. We then filed Chapter XXXX in order to reorganize our debt and continued to try to engage with XXXX XXXX XXXX  for a modification ( judge 's instructions ) with no luck. In XX/XX/XXXX we received a check from XXXX XXXX  XXXX for {$400.00} as part of a settlement based upon " poor servicing standards but never cashed it for fear we would give up our right to fight back in the future. We were concerned that by cashing the check we would give up all rights to litigate the matter in the future so we never did. As the bankruptcy was nearing discharge ( mid XX/XX/XXXX )  we were offered a SECOND modification by XXXX XXXXXXXX XXXX and we made the first two trial payments and then received a letter from XXXX XXXX XXXX  that the loan was being transferred to Fay and that they would honor the modification. As explained Fay would not accept our modification payment and our Account manager XXXX XXXX made misrepresentations to us and said that they " did not care about what XXXX XXXX XXXXXXXX did and that they would not honor the modification. '' At that time we contacted HUD counseling and Senator XXXX  to  investigate. Eventually we were able to get Fay to offer a modification and made the three trial payments as agreed but found that the permanent modification terms were interest only and that there was a huge balloon payment at the end. We discovered the trustee payments we had made for 5 years towards our mortgage had never been applied to our loan, instead going to late fees, legal fees, junk fees and escrow. We also found that even though we had been approved for modifications on two occasions and then kicked out of the modifications due to servicing errors or unethical conduct that we were still charged interest, late fees, legal fees, Attorney fees etc. for every month during those time periods. Due to all of these factors we determined it was not in our best interest to accept this modification offer. 

We continued to try and negotiate with Fay but made no progress and filed for mediation and hired an Attorney. At the mediation it seemed that our Attorney was working for Fay Servicing -- he had failed to give us the chance to review an alleged loan modification offer and we were essentially pushed into committing to do a deed in lieu and agreeing to sign the house over to Fay.

Company response to consumer: Closed with explanation