Consumer complaint received 2026-04-16 00:00:00
Product: Mortgage — FHA mortgage
Issue: Problem with a company's investigation into an existing problem — Their investigation did not fix an error on your report
Company: Freedom Mortgage Company
State: TX

Complaint narrative:
I am filing a complaint regarding inaccurate credit reporting caused by mortgage servicing errors on my account. In XX/XX/2025, my mortgage servicer paid my homeowners insurance from escrow, but the premium had increased significantly, creating a large escrow shortage and increasing my monthly payment. I obtained a new, more affordable insurance policy and requested that the refund from the previous policy ( ~ {$4500.00} ) be applied to my escrow account to cover the new premium and offset the shortage. Instead, the servicer misapplied these funds to my principal balance. It took multiple calls and several months to attempt to correct this error. Multiple escrow analysis were performed as funds were reversed, applied, reapplied and reversed again, resulting in confusion on payment amount due for the month of XX/XX/2025. In XX/XX/2025, I made a mortgage payment of {$1300.00}, as directed by my mortgage servicer, per their prediction of the final pending escrow analysis. This payment was also misapplied and placed into escrow instead of being credited as a regular monthly payment. When I contacted the servicer to correct this, they refused to reverse and reapply the funds and instead required that I make an additional full payment for XXXX. Due to the servicers misapplication of both the insurance refund and my XXXX payment, I was unable to reasonably make a second full mortgage payment for the same month. Despite this, the servicer reported my account as 30 days late. Prior to the 30 day late report, we were advised my the servicer to apply for a hardship program through loss mitigation in order to avoid the late payment report. We followed all steps given to us, were denied ( understandably so, as our hardship at this point was due to an error on their end, not a change in lifestyle or income ), and ultimately resulted in the incorrect 30 day late payment being reported. I continued making monthly payments as agreed and ultimately made a double payment on XX/XX/2025 to resolve the issue caused by these servicing errors. This placed a significant financial burden on my household, requiring my husband to obtain a temporary second job for additional income to cover what was effectively a duplicate payment caused by the servicers mistakes. The reported delinquency was not due to nonpayment, but rather the result of the servicers failure to properly apply funds and correct known errors. Reporting this as a late payment is inaccurate and does not reflect my actual payment behavior or history. I am requesting that the servicer : 1. Conduct a full investigation into the misapplication of funds and servicing errors on my account. 2. Correct any internal account records as necessary. 3. Remove the 30-day late payment from all credit reporting agencies, as it was caused by servicer error and not a failure to pay. I have made every effort to resolve this issue directly with the servicer over several months without success. I am seeking correction of inaccurate credit reporting resulting from these errors. Thank you for your help in resolving this matter.

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