Consumer complaint received 2025-11-24 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: M&T BANK CORPORATION
State: RI

Complaint narrative:
XXXX XXXX XXXXXXXX XXXX XXXXXXXX CFPB Complaint Statement Lender Error Causing Partial Escrow Shortage I am submitting this complaint regarding M & T ; Banks handling of my escrow account. In XXXX M & T incorrectly used quarterly figures instead of annual figures and caused an overage in the account. This error cause them to send me out a check in the amount of appx {$2600.00}. I did not request this check and thought since my new payments were lower the check was overages of my past payments. I should not be penalized for their error. As a result my mortgage payments are drastically raising. 
M & T Bank has admitted in writing that the XX/XX/2025 escrow analysis they performed was incorrect and that the shortage shown in the account is due to the banks mistake.

M & T ; s response to me states : The shortage would have been lower without the error in XXXX escrow, but you would still have a shortage due to increased taxes and insurance. 
I fully understand that increased taxes and insurance can naturally create a legitimate shortage, and I am not disputing that portion. 
The issue is that M & T ; is requiring me to repay the entire shortage, including the part that was caused solely by their admitted mistake. 
Under RESPA ( Regulation X 1024.17 ), a lender may not penalize a borrower for a lender-caused shortage. However, M & T ; is attempting to apply the full shortage to my account and spreading it over XXXX  monthly payments, resulting in a higher mortgage payment for XXXX years due in part to a lender-generated error. 
Requested Resolution : Remove the portion of the shortage created by the XX/XX/2025 miscalculation. 
Apply only the legitimate shortage related to the tax/insurance increases. 
Confirm that the erroneously issued refund does not need to be repaid. 
Correct the escrow ledger to reflect a borrower-neutral adjustment. 
Additional Issue : Retroactive Payment Correction Needed Because M & T ; added the full ( inflated ) shortage into my escrow payment beginning in XX/XX/2025, my monthly payment increased substantially. Since this increase included the portion of the shortage caused by the XXXX error, I was unable to pay the inflated amounts for XXXX and XXXX. 
I am requesting that the CFPB require M & T ; to retroactively apply the corrected payment amount starting XX/XX/2025, recalculate the XXXX and XXXX payments, remove any delinquency, and bring the loan current. 
Restitution Request Due to the financial impact caused directly by M & T ; s admitted errorincluding inflated payments, missed payments, administrative burden, and potential credit implicationsI am requesting appropriate restitution. This includes : Removal of all late fees Reversal of any negative credit reporting Reimbursement of any penalty or incidental charges arising from the error A reasonable goodwill credit for the hardship caused Sincerely, XXXX XXXX

Company public response: Company has responded to the consumer and the CFPB and chooses not to provide a public response
Company response to consumer: Closed with explanation