Consumer complaint received 2025-09-18 00:00:00
Product: Mortgage — FHA mortgage
Issue: Struggling to pay mortgage — Applying for or obtaining a modification, forbearance plan, short sale, or deed-in-lieu
Company: BROKER SOLUTIONS, INC.
State: TX

Complaint narrative:
Subject : Complaint Against New American Funding Mishandling of FHA Hardship/Short Sale Program Dear Consumer Financial Protection Bureau , I am submitting this complaint against New American Funding ( NAF ) regarding its mishandling of my FHA-backed mortgage and its hardship assistance programs. Instead of providing the support intended by federal law and policy, NAFs actions have deepened my hardship, damaged my credit, and left me at continued risk of foreclosure despite my good-faith efforts to resolve my situation. 
________________________________________ Key Issues 1. Mishandled Hardship Programs and Modifications I entered hardship after more than {$72000.00} in undisclosed home repairs ( plumbing, leaks, HVAC, mold ) made the property uninhabitable and drained my savings. 
NAFs process required me to miss payments beginning in XX/XX/XXXX just to show hardship and qualify for assistance, which intentionally harmed my credit. This practice runs counter to CFPB Regulation X ( 12 C.F.R. 1024.41 ), which prohibits servicers from dual-tracking foreclosure or penalizing borrowers with negative reporting while a complete loss mitigation application is under review. 

In XX/XX/XXXX, I submitted a complete application for a short sale along with two letters requesting this option. Instead of honoring my request, NAF sent me a loan modification that significantly increased my interest rate and contained no beneficial terms for me. This punitive modification benefitted the lender, not me, and directly contradicted FHAs Loss Mitigation Program ( HUD Handbook 4000.1 ). 
I was forced to decline that modification in XXXX before NAF would even consider the short sale. Only at the end of XXXX was I finally permitted to list the property. By XX/XX/XXXX, I had secured a cash buyer above asking price. Despite this, NAF has delayed closing multiple times and pushed it out to XXXX, prolonging my financial and emotional strain. 

XXXX Credit Reporting Abuse Throughout this process, NAF continued to report me as 60180 days late, even while I was in active hardship review and later approved for a short sale. My credit score dropped by XXXX points. 

These actions violate the CARES Act 4021 and Fair Credit Reporting Act ( 15 U.S.C. 1681s-2 ( a ) ( 1 ) ( A ) ), which prohibit inaccurate or misleading reporting during periods of accommodation. 

XXXX. Forcing Surrender of Escrow, Insurance, and Tax Refunds NAF is requiring me to surrender my remaining escrow funds ( despite no shortages ), as well as any insurance proceeds or tax refunds, directly to them as a condition of short sale. 

Under RESPA ( 12 U.S.C. 2605 ( g ) ; 12 C.F.R. 1024.17 ( f ) ), surplus escrow balances must be returned to the borrower within 30 days after loan payoff or termination unless lawfully applied. Demanding these funds violates RESPA and HUD guidance ( HUD Handbook 4000.1, Escrow Accounts ). 

This practice strips me of critical resources needed to secure housing after the short sale, further perpetuating harm instead of relief. 

XXXX. Failure of Good Faith in Loss Mitigation Federal law requires servicers to act in good faith and evaluate borrowers for all available loss mitigation options ( 12 U.S.C. 2605 ( k ) ( 1 ) ( C ) ; 12 C.F.R. 1024.41 ). NAF instead prolonged the process, misinformed me, and initially denied relocation assistance I was entitled to under HUD policy until my realtor escalated. 

Their refusal to approve closing despite a cash buyer above asking price demonstrates bad-faith handling intended to delay resolution and inflict further financial harm. 

XXXX. Texas Law Violations Under the Texas Debt Collection Act ( Tex. Fin. Code 392.301 ), it is unlawful for a servicer to misrepresent the status of a debt or threaten foreclosure improperly. By telling me foreclosure was still possible even after short sale approval, NAF engaged in misleading and harassing conduct. 
________________________________________ Demands for Relief I respectfully request that the CFPB investigate New American Funding for violations of federal mortgage servicing laws, consumer protection statutes, and Texas debt collection law. Specifically, I seek : Credit Relief Immediate removal of all negative late-payment reporting during the hardship/short sale process under the CARES Act and FCRA. 

Short Sale Penalty Waiver Removal of the 2-year FHA short sale penalty, as I acted in good faith, disclosed hardship, and presented a qualified buyer above asking price. HUD regulations ( 24 C.F.R. 203.355 ) allow exceptions where the borrower is not at fault. 

Return of Funds Full return of all remaining escrow balances, insurance proceeds, and tax refunds owed to me under RESPA and HUD policy, instead of being wrongfully surrendered to NAF. 
Servicer Accountability Enforcement of RESPA/Reg X to ensure timely, good-faith processing of hardship applications without coercion into self-serving modifications.

Review of whether NAFs actions rise to the level of unfair, deceptive, or abusive acts or practices ( UDAAP ) under the Dodd-Frank Act. 

Closing I purchased my home in late XXXX as a XXXX XXXX living with a permanent disability, proud to finally provide stability for my family after years of hard work and recovery. Unfortunately, within weeks of moving in, I discovered major undisclosed issues severe leaks, plumbing failures, mold, rotted wood, and unsafe ductwork. Over time, I spent more than {$72000.00} on repairs, draining my savings and forcing me to take on debt just to keep the home livable. 

When it became clear I could no longer sustain both the mortgage and ongoing repair costs, I reached out to New American Funding for help. Instead of support, I was met with roadblocks. They pushed me into loan modifications that raised my rate and benefited them, not me. When I requested a short sale to responsibly resolve the situation, they delayed for months, gave me conflicting information, and continued reporting me late to the credit bureaus even though I followed their process in good faith. 

I found a qualified cash buyer over asking price, but NAF still prolonged closing and even threatened foreclosure. This process has left me financially and emotionally devastated. What began as a dream home turned into a constant crisis, and the hardship program that should have provided relief has instead caused me greater harm. 

I purchased this home in good faith, only to face predatory servicing practices when hardship arose. NAFs actions have left me in greater financial distress than before seeking help. The hardship programs exist to stabilize families and prevent foreclosure, not to punish borrowers with inflated interest, prolonged timelines, and credit destruction. 

I respectfully ask the CFPB to intervene to restore my credit standing, ensure timely resolution of my short sale, and hold NAF accountable for these violations.

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