Consumer complaint received 2025-02-21 00:00:00
Product: Mortgage — FHA mortgage
Issue: Struggling to pay mortgage — Trying to communicate with the company to fix an issue related to modification, forbearance, short sale, deed-in-lieu, bankruptcy, or foreclosure
Company: PENNYMAC LOAN SERVICES, LLC.
State: NJ

Complaint narrative:
Background Information : Penny Mac has been my mortgage lender since XXXX My house is owned by myself and my mother is my co-signer XXXX XXXX I requested via phone a brief forbearance period due to sudden financial/personal crisis. 

Request for Forbearance/Initial Phone Consult on Penny Mac Recorded Line : Below are some points from my initial communication I had with a Penny Mac representative on their recorded phone line. Some of the general information I received outlined below. 

-I was told I can apply for their forbearance relief program due to my sudden financial crisis. 
-The first thing I asked about were any penalties involved and I was informed that I may acquire penalties on my account during the forbearance period but not to worry because after my forbearance concludes and I resume with a payment, they would be removed and it would be as if they were never there. I was assured I wouldnt have to worry about any fees or penalties, that it is just a brief pause in payments and those payments can be paid in full upon completion of forbearance or tacked on to the end of my loan. 
- I was specifically assured multiple times that me and my co-signers credit would not be impacted by this program and that if it was effected it would only be temporary and would be removed once I resumed paying after forbearance program. I asked more than once as I was specifically concerned with effecting my mothers credit and I was assured zero fall out from completing this brief pause/relief program. 

Advice I Received During Initial Call Once I Wanted to Apply For Forbearance : - I was specifically instructed to make sure NO payments go through on my end from this point forward as that would result in termination of my forbearance application. 
- He reviewed my account to check for auto-pay enrollment, to which I informed him I am on auto pay but through XXXX XXXX XXXX XXXX not through Penny Mac . 
- He offered me some conventional steps that can typically be used to disable an auto-pay feature via online banking - The representative informed me that he will formally initiate the forbearance application proceedings once I can confirm that my Penny Mac auto bill pay setting via XXXX XXXX XXXXXXXX banking has been disabled. He helped to walk me through the process best he could and I was able to successfully deactivate auto pay setting to avoid a disqualification due to error. 
- This call closed with him informing me of next steps which was to anticipate their application paperwork in the mail which would need to be completed, signed and notarized by both me and my mom/co signer. I requested that all mailed correspondence to be sent to my mothers address. 

Application Process : The application process began after that first phone consult and without many hiccups. 
We quickly completed, signed, notarized, and returned application packet via prepaid shipping label all still within month of XXXX. 
They notified me via costumer online portal when they received the completed packet. 
This is also where Penny Mac would send over their document requests for me and my mom to add to our application file and each request had a deadline to meet. 
We were able to meet all deadlines except for one record request assigned to my mom regarding her social security information. Because the delay was out of our control, and no fault to us, Penny Mac granted a brief extension.

Once we satisfied Penny Macs requests for documentation, we were instructed again via phone call to standby and to continue being delinquent with payments until decision is made. 

Application Decision : In XXXX, my application was approved with forbearance until XXXX. 
The approved payback agreement was that the XXXX missed payments during the forbearance program-XXXX, XXXX, XXXX, XX/XX/XXXX, were to be tacked on to the end of my loan and would be paid in full if/when I sell my house or pay off, etc. 
XXXX ended my forbearance relief and I resumed making my normal mortgage payment that month. 

Post Forbearance Relief/The Aftermath : Penny Mac received my first post forbearance payment in XXXX I happened to notice in my account via Penny Macs online portal, they posted XXXX $ late fees for every month during forbearance. XXXX and XXXX each had their own but In XXXX, the month they approved my application until XXXX, they charged a double late fee I assume is for XXXX and XXXX since there was no late fee charge posted in XXXX. Not only was I not supposed to receive any late charges at all especially since my account was current when I reached out requesting brief forbearance relief going forward but how can a business post a late fee in advance? Late fee posted a whole month prior to when the payment wouldve been made doesnt seem right. 

Not only did they charge late fees they werent supposed to but my co-signers credit score went from in the XXXX down over XXXX points! My credit report was also damaged tremendously due to Penny Mac submitting delinquent payments for 3 months to the credit bureau! 

When my mom and I reached out via messaging in user portal asking when they were going to remove the erroneous delinquent payments reports they sent to the credit bureaus since it is impacting us financially in devastating ways they tell me it was not an error and I was delinquent! But I was on forbearance and they told me to be delinquent!! Same ridiculous response regarding erroneous late fees as well when the representative claimed they accurately reported my late fees because I was delinquent. I was delinquent bc of forbearance and Penny Macs advice!! 

After that ridiculous reply I did some investigating via internet to see if I was alone in this issue. I found that I was very far from alone in this issue. This prompted me to stop trying to convince random Penny Mac representatives why and how they are wrong because its clear I will not get anywhere doing that. Seems to be a pattern, from many forums Ive read through, Penny Mac only fixes their mistakes after hearing from CFPB and thats why Im reaching out. 

I came to them as a loyal, good standing customer to ask if their is any temporary relief due to unforeseen crisis in life and they assured me that itll be ok bc they offer this great forbearance program for brief relief and tell me I should apply. Most outrageous piece is how I was instructed to NOT pay my mortgage at all while going through the process, but that I am safe and will not be penalized only to have me and my mom get hit with devastating, crippling undeserved penalties and financial pain. This feels to me almost like a bait and switch move and its concerning. 

On top of this, another disturbing part is that I can no longer access any of my pdf documents in my file the portal. When you try to open any of the pdf documents from the forbearance process it says its not available. PLEASE HELP!

Company response to consumer: Closed with explanation