Consumer complaint received 2025-08-06 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Loan sold or transferred to another company
Company: Fay Servicing, LLC
State: NY

Complaint narrative:
This complaint details a series of predatory and obstructive practices by Fay Servicing and the current loan investor concerning the property located at XXXX, NY. These actions have demonstrably jeopardized my investment, inflated my debt, and appear designed to force an unjust foreclosure. 

Background and Initial Challenges : In XXXX XXXX, our company acquired a two-family property, securing financing of XXXX XXXX through a private lender/investor, with an additional approx. {$98000.00} for planned renovations based on a scope of work. Our project was severely delayed for nearly XXXX years due to the presence of squatters and the inaccessibility of courts during the XXXX pandemic. Despite these significant obstacles, our company consistently fulfilled its mortgage obligations to the lender, often relying on personal funds and private loans to maintain payments. 

Renovation Funding Delays and Unnecessary Hurdles : Following the squatters ' eviction in XX/XX/XXXX, the original investor, despite prior awareness of the loan 's maturity and continuing to accept payments, initially refused to release the renovation funds. Only after intervention from the lender was the first draw of {$12000.00} finally received on XX/XX/XXXX, XXXX full XXXX months post-eviction. This substantial delay resulted in the loss of my construction crew and significant project setbacks. Subsequent draws on XX/XX/XXXX, and XX/XX/XXXX, were similarly difficult to obtain, requiring extensive communication and often causing payments to be processed late due to investor approval requirements. The project became a substantial drain on my personal and other business finances. 

The Transfer to Fay Servicing and XXXX  XXXX  : The situation escalated dramatically in XX/XX/XXXX, when the loan was sold to a new investor and serviced by Fay Servicing. Despite my consistent payment history with the previous investor/servicer, Fay Servicing XXXX XXXX the loan as matured and, without providing any formal notice, suggested that I apply for and extension, but refused to accept subsequent mortgage payments while an " extension application '' was in process. I made it known that this action if prolonged, will directly manufacture a delinquency, cause delays and my company would further lose time and money. 

My attempts to resolve the situation with Fay Servicing, particularly with the Assistant Vice-President ( VP ), were met with persistent obstruction : - Forced Delinquency : Fay Servicing 's refusal to accept payments while an extension was pending directly caused the loan to become delinquent. 

- Repeated, Redundant Requests : Throughout XXXX and XX/XX/XXXX, Fay Servicing and the investor repeatedly demanded information ( e.g., updated scope of work, budget, permits, exit plan, project timeline ) that was either already provided in the initial application or could not be realistically furnished without access to the renovation funds to complete the project. For instance, a request for permits on XX/XX/XXXX, was identically repeated on XX/XX/XXXX, demonstrating a lack of internal communication or a deliberate tactic to delay. 

- Lack of Transparency : There has been no clear timeline, specific requirements, or transparent cooperation regarding the extension application process. The assistant VP stated that decision pertaining to the extension were at the investors discretion thus it was a waiting game ( XXXX XXXX ). I made it know that I would proceed working on the property with the monies of the mortgage payments of which they are refusing to accept, just so I would not lose as much time when the investor finally makes up his/her mind. Also, I had a request renovation draw of about XXXX XXXXXXXX, so I offered for the company to deduct any and all payments due from that and provide me with the rest to continue the project. I specifically asked the assistant VP to present the offer to the investor ( XXXX ) and like many other requests and/or questions, it went unanswered. 

- Unjustified Demands : On XX/XX/XXXX, Fay Servicing demanded " foreclosure fees '' as part of the " extension application '' approval process, despite the fact that I was current on payments when the extension process began, and foreclosure proceedings had not been initiated. 

Inflated XXXX and XXXX Practices : Upon requesting a payoff letter for potential refinancing with the previous lender, the loan balance had inexplicably surged from an original principal of {$400000.00} ( possibly including renovation funds drawn ) to approximately {$910000.00}. This dramatic increase includes : Unpaid Principle Balance : {$400000.00} Interest : {$23000.00} Recoverable Corporate Advances : {$300000.00} ( I have no idea what this is ) Default Interest : {$180000.00} I assert that the " Recoverable Corporate Advances '' and " Default Interest '' are the direct result of Fay Servicing XXXX and the investor 's deliberate delays and refusal to accept payments, constituting predatory lending behavior. An appraisal valued the property at {$720000.00} ( far below market value but acceptable for this purpose ), with a projected market value of {$850000.00} upon completion, with an additional XXXX XXXXXXXX in additional XXXX, indicating substantial equity that should have facilitated an extension very quickly back in XXXX of XXXX rather than a push toward foreclosure and for Fay Servicing to aid and investor to rapidly rip off a small business for over {$500000.00} in less than XXXX  months. The appraisal company used for this evaluation are evaluators typically used by banks and most often devalues the property. A simple google search of this property without and knowledge of the XXXX will show significant difference in the assessment and even appraisal from XXXX  years ( XXXX ), again when the property had not had any XXXX was at least XXXX XXXXXXXX higher than the current assessment of XXXX. 

Allegations of Regulatory Non-Compliance : My concerns are compounded by Fay Servicing XXXX many past infractions with regulator violations but most recent history shows a Consumer Financial Protection Bureau ( CFPB ) XXXX XXXX issued on XX/XX/XXXX for violations of ( i ) the Consumer Financial Protection Act of XXXX ( XXXX ) : XXXX XXXX. XXXX, XXXX, including prior XXXX consent orders... Fay Servicing fulfilled several obligations under the XXXX XXXX, including, among other things, paying a civil money penalty {$2.00} XXXX and {$3.00} XXXX in to the XXXX for XXXX consumer redress for various violations. The Consent Order was terminated as recent as XX/XX/XXXX, but I allege that similar violations of the Consumer Financial Protection Act of XXXX ( XXXX ) have occurred in my case. Furthermore, Fay Servicing has refused to provide a servicing file and timely delivery of requests for my account, which I believe is a violation of federal CFPB rules.

Company response to consumer: Closed with explanation