Consumer complaint received 2026-01-14 00:00:00
Product: Mortgage — FHA mortgage
Issue: Trouble during payment process — Escrow, taxes, or insurance
Company: Mr. Cooper Group Inc.
State: AR

Complaint narrative:
* * * NOTE : THERE ARE NUMEROUS OTHER DOCUMENTS THAT I NEED TO PROVIDE IN ADDITION TO WHAT IS SHOWN HERE. PLEASE CONTACT ME TO OBTAIN THOSE DOCUMENTS. * * * I am submitting this complaint regarding long-standing servicing errors and mismanagement of my mortgage account, which have caused financial hardship and put my home at risk. Since the servicer took over the loan, the account has experienced repeated mismanagement of escrow funds, including unapplied surplus payments, negative escrow balances, and improper disbursements. 

Excessive insurance premiums were charged and paid through the servicer without prior notice, leading to a significant and unsustainable increase in my monthly payment. I have been unable to make partial payments or manage the escrow effectively due to restrictions imposed by the servicer. Additionally, delays in recognizing the successor in interest after the death of the primary borrower prevented access to the account, insurance refunds, and proper application of payments. 

Attempts to resolve these issues, including requests for escrow corrections, insurance reimbursements, loan modification, forbearance, and payment deferrals, have been met with confusion, delays, and inadequate responses. These errors have caused repeated financial and emotional strain, threatened foreclosure, and prevented resolution of the account despite my willingness and ability to pay the correct mortgage amounts. 

I am submitting supporting documentation, including call notes, written correspondence, and account statements, which detail the timeline of these issues, the servicers responses, and the ongoing impact on the account. My goal is to have the servicer correct escrow mismanagement, properly apply payments and refunds, prevent unauthorized insurance charges, and establish a sustainable monthly payment. 

These are the call notes that I have taken during recent conversations with Mr. Cooper Representatives : > On XX/XX/XXXX, I spoke with Mr. Cooper regarding ongoing issues with our mortgage account caused by mismanaged escrow and excessive insurance charges. I explained that our original monthly payment was {$350.00}, but due to escrow-controlled disbursements for insurance and taxes that were mishandled, our monthly payment had ballooned to over {$1200.00}. I informed the representative that we had sufficient funds to cover the mortgage principal and interest, but the system would not allow payments below the inflated, escrow-driven amount. 

I requested guidance on defending against the insurance companys overcharges and preventing further unnecessary increases to the escrow balance. The representative confirmed that the account had been mismanaged but stated that escrow removal could not occur until the outstanding shortage of XXXX XXXXcaused by the insurers overchargewas reimbursed. I emphasized that we had no control over these insurance charges and that this situation had persisted for nearly XXXX years, causing repeated financial hardship and emotional distress. 

Despite my explanation, the representative insisted that our only recourse was to secure a lower-cost insurance policy, wait for reimbursement, and then request escrow removal. This process left us effectively trapped in the inflated payment cycle until all steps were completed. I expressed frustration that we had never previously been informed that we could handle insurance and taxes ourselves to maintain a reasonable mortgage payment. 

The representative reassured me that once the insurance was switched, reimbursement received, and escrow removed, our monthly payment would return to approximately {$320.00}, but only after enduring months of excessive, preventable payments and an artificially inflated escrow balance. 

> On XX/XX/XXXX, I contacted Mr. Cooper to warn that an additional escrow-funded insurance payment was scheduled imminently, which would further deepen the negative escrow balance and delinquency. I requested that the servicer pause or prevent the payment so that the pending insurance refund could be applied and escrow could be stabilized. 

The representative acknowledged the situation but stated that the servicer could not stop the payment. I explained that proceeding with the payment would restart the cycle of escrow shortages, inflated monthly payments, and inability to make regular mortgage payments. Despite this advance notice, the servicer went forward with the escrow-controlled insurance payment, exacerbating the accounts default status. 

I also explained that the insurance refund check had been issued in the deceased borrowers name, making it impossible to cash, and that the insurer had been instructed to send the funds directly back to Mr. Cooper. The representative confirmed that escrow removal and stabilization could not occur until the refund was received, while continuing escrow disbursements that increased the deficit. 

> On XX/XX/XXXX, I contacted Mr. Cooper to confirm whether the insurance companys refund check had been received and could be applied to the account to address the negative escrow balance. I explained that the check had been sent to me instead of directly to Mr. Cooper and that I could not deposit it. I asked whether I could endorse the check and submit it to Mr. Cooper to correct the escrow balance and facilitate escrow removal. 

The representative initially indicated that, once the funds were returned to escrow, the account could be evaluated for potential escrow removal. However, they also explained that the servicer typically does not accept checks issued to the borrower rather than directly to Mr. Cooper, creating additional obstacles and delaying resolution. 

I further explained that the accounts escrow had been taken over without our consent when Mr. Cooper purchased the loan, which allowed the insurance company to raise premiums dramaticallyfrom approximately {$1000.00} to nearly $ XXXX our agreement. This led to inflated mortgage payments, delinquency notices, and threats of foreclosure despite my efforts to resolve the situation. 

The representative acknowledged the issues but did not provide a clear resolution before the call ended abruptly by them hanging up on me. 

> On XX/XX/XXXX, I spoke with Mr. Cooper representatives regarding disruptions to our mortgage account caused by mismanaged escrow, lender-placed insurance, and the death of the primary borrower, my grandfather. I explained that while we had sufficient funds to pay the regular mortgage, the system would not allow us to apply any payments without completing the successor-in-interest process. 

The representative confirmed that, without proper successor documentationincluding a death certificate and proof of relationshipthey could not release loan-specific information, process insurance refunds, or apply payments. This placed us at risk of foreclosure despite our willingness and ability to pay. I emphasized that the situation had caused confusion, repeated financial hardship, and emotional distress. 

I described that the insurance company had issued a refund check in our name, which we could not deposit because the primary borrower had no bank account. The servicer refused to redirect the funds without successor authorization. I expressed frustration that we had never been informed that lacking successor documentation would prevent us from accessing funds or making payments, leaving the account effectively frozen and unresolved. 

The representative acknowledged that these issues were not our fault and remained on the call while escalating the matter to a loss mitigation specialist. They then advised that, once the successor-in-interest paperwork is completed, the specialist would assist in resolving escrow, insurance, and payment issues. 

> On XX/XX/XXXX, I spoke with Mr. Cooper representatives regarding ongoing problems with our mortgage account stemming from mismanaged escrow, lender-placed insurance, and prior servicing errors. I explained that the account had been severely disrupted by insurance charges that we had not approved and over which we had no control. Despite having funds to make our regular mortgage payments, we could not access or apply refunds issued by the insurance company because the primary borrower ( my grandfather ) did not have a bank account and the check lacked an endorsement line. I expressed concern about the risk of losing our home despite our willingness and ability to pay. 

The representative confirmed that when Mr. Cooper assumed servicing in XX/XX/XXXX, the account already carried an escrow balance transferred from the prior servicer. They explained that lender-placed insurance had been applied prior to Mr. Coopers servicing and that escrow disbursements, including delinquent taxes, had contributed to an inflated mortgage balance. I explained that these insurance charges had effectively quadrupled our monthly payment, causing extreme financial and emotional stress. 

The representative informed me that the account could not be fully resolved or adjusted until the successor-in-interest process was completed due to the death of the primary borrower. To legally assume ownership and access loan-specific information, I needed to provide the deceased borrowers death certificate and proof of relationship, such as my birth certificate. I expressed concern that this process could require credit checks and complicate ownership transfer, as my father ( co-manager of the property ) wished to avoid probate. 

Throughout the call, I conveyed ongoing confusion, stress, and frustration over years of miscommunication and lack of transparency regarding escrow and insurance management. The representative acknowledged my concerns, confirmed the historical mismanagement of escrow and insurance, and escalated the matter to a loss mitigation specialist to guide me through the successor-in-interest process. I was reassured that, once the proper documentation is submitted, Mr. Cooper would assist in restoring account control and resolving outstanding issues. Until that process is completed, however, we can not access insurance refunds, adjust escrow, or prevent further potential foreclosure action. 

XXXX XXXX XX/XX/XXXX, I contacted Mr. Cooper to address ongoing issues with our mortgage account, including mismanaged escrow, lender-placed insurance, and complications related to the successor-in-interest process following the death of the primary borrower. I requested assistance from the research department and asked that my attorney or legal representative be allowed to speak with someone at Mr. Cooper regarding the account. 

The representative repeatedly placed me on hold and confirmed that I was not listed as an authorized party on the account, despite my active involvement in managing payments and the property. When I requested that my attorney be allowed to communicate on our behalf, the representative stated that no information could be provided to an unauthorized party and refused to escalate the call to the legal or research department. 

I emphasized the urgency of resolving the account issues due to the successor-in-interest process and my need to access account information. The representative maintained that, without proper authorization, they could not provide assistance. The call concluded without resolution, leaving the account issues unaddressed and continuing the risk of foreclosure despite our willingness and ability to manage the mortgage and related payments. 

> On XX/XX/XXXX, I spoke with a Mr. Cooper representative regarding ongoing issues with our mortgage account, including mismanaged escrow, excessive lender-placed insurance payments, and complications arising from the successor-in-interest process following the death of the primary borrower. I explained that the account had experienced repeated mismanagement since Mr. Cooper assumed servicing in XX/XX/XXXX, including escalating monthly payments from {$780.00} to over {$1200.00} due to escrow shortages and unauthorized insurance disbursements. I requested guidance on correcting the account, reducing the monthly payment, and properly applying funds from previous escrow surpluses. 

The representative confirmed that my father, XXXX XXXX, had been recognized as the successor in interest and that I could be added as an authorized party on the account. We discussed placing a new insurance policy on the property, and the representative explained that the policy could be applied, but the existing negative escrow balance would temporarily increase until the new policy was processed and prior overpayments reimbursed. 

I emphasized that the original {$6400.00} escrow shortage was caused entirely by Mr. Coopers prior payments to the insurer without notification. Because of these errors, we had been unable to make partial payments or otherwise manage the mortgage since XX/XX/XXXX, resulting in a current account balance exceeding {$11000.00}, despite the original loan obligation being only {$320.00} per month. I also explained that previous surplus checks had not been correctly applied due to the lack of a recorded successor-in-interest, compounding the escrow mismanagement. 

I stressed that these ongoing issues, including repeated forced-placed insurance payments without notice, had caused prolonged financial strain and confusion. The representative acknowledged the problems and agreed to escalate the matter to a manager to help resolve the issues, including properly applying surplus funds, correcting escrow calculations, and preventing further unauthorized insurance charges.

We scheduled a follow-up call with a manager for the next day at a time when my father could participate to ensure a thorough review of the account and begin addressing the longstanding mismanagement. The call concluded with the understanding that corrective steps would be pursued, but no immediate resolution was achieved during this call. 

> On XX/XX/XXXX, I contacted Mr. Cooper to follow up on longstanding issues with our mortgage account, including mismanaged escrow, unauthorized lender-placed insurance, and confusion regarding the successor-in-interest process. My father, XXXX XXXX, had recently been recognized as the successor in interest following the death of the primary borrower, XXXX XXXX, and I am an authorized user on the account. I requested assistance from someone with authority to review and resolve account issues dating back to XXXX, including misapplied payments, unauthorized insurance charges, and payment history discrepancies. 

I informed the representative that we had previously been told a manager would call at XXXX PM to review the account, but no call occurred. I also noted that a formal Notice of Error was submitted on XX/XX/XXXX, regarding escrow mismanagement, negative balances, and forced-placed insurance payments, which had caused significant financial and emotional strain. 

I explained that previous escrow disbursement checks issued in my grandfathers name could not be applied because no successor in interest had been recorded, leading to negative balances, additional analyses, and an increase in our monthly mortgage payment despite available funds. I emphasized that the recent {$8200.00} insurance payment far exceeded normal premiums of approximately {$1500.00} and, combined with mismanaged escrow, caused our monthly mortgage payment to jump from {$780.00} to {$1300.00}, despite the original note being {$320.00} per month. Partial payments were not accepted, and the instructions to cancel the insurance, wait for a reimbursement check, and return the funds to Mr. Cooper delayed correction of the account, resulting in an approximately XXXX-XXXX  delinquency balance of over {$5000.00}. 

I clarified that our inability to pay the inflated {$1300.00} amount was not due to general financial hardship but resulted from ongoing service errors, misapplied funds, reversed payments, and long-standing escrow mismanagement. We now have a replacement insurance policy ready to submit but are hesitant to apply the premium until the negative escrow issue is resolved. 

I detailed the history of the insurance premiums, which increased from around {$1500.00} in XXXX to {$3400.00} in XXXX, then spiked to {$8200.00} in XXXX without notification or opportunity to review. Additionally, a {$2000.00} surplus check from XXXX could not be cashed due to the death of the original borrower, contributing to a negative escrow balance that compounded over the years. A previous loan modification trial was canceled after trial payments, and a forbearance and payment deferrals in XXXX further complicated the account. 

The representative confirmed that Mr. Cooper pays insurance invoices as submitted by the insurance company and does not independently verify premiums or notify customers of increases beyond general notices. While Mr. Coopers payment of the {$8200.00} premium was understood, it contributed to a negative escrow balance, which combined with unapplied funds and service errors, left the account unmanageable. 

I emphasized that the payoff amount on the loan is now approximately {$2000.00} higher than the original loan despite over {$30000.00} in payments since Mr. Cooper assumed servicing, highlighting ongoing mismanagement. I requested guidance on working with the research department to review account history, correct negative escrow, and establish a manageable payment plan while maintaining the ability to bring the account current and prevent foreclosure. 

We discussed the expired demand letter ( XX/XX/XXXX ), and I asked whether bringing the account current would allow someone to work on resolving escrow issues. The representative confirmed that the account must be current to prevent additional delinquency but that resolution of underlying escrow discrepancies requires review by an authorized department. 

I provided my contact number and confirmed that all future communications should be directed there to maintain continuity. I emphasized our commitment to resolving the account and protecting the home from foreclosure while ensuring payments reflect accurate escrow calculations. The call concluded with the understanding that a manager or authorized department would review the account to reconcile misapplied payments, correct escrow, and prevent unauthorized insurance charges, though no immediate resolution was achieved.

Company response to consumer: Closed with explanation