Consumer complaint received 2024-08-23 00:00:00
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Trying to communicate with the company to fix an issue while managing or servicing your loan
Company: SELECT PORTFOLIO SERVICING, INC.
State: CA

Complaint narrative:
XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX Servicing ATTN : XXXX XXXX XXXX XXXX XXXX XXXX  XXXX XXXX XXXX XXXX 
XXXX XXXX XXXX, XXXX  XXXX To whom it may concern, I hope this letter finds you well. I am writing to address an ongoing issue related to a mortgage modification I underwent with XXXX XXXX  in XXXX, and subsequent tax implications regarding a refund issued in XXXX. I am writing to bring to your attention a series of unresolved issues related to my mortgage account, which have caused significant distress and financial hardship for me over the past several years. 

In XXXX, I entered a modification process with XXXX XXXX, and I am pleased to report that the modification was finalized in XXXX with terms that were favorable and helped me manage my mortgage obligations effectively. In XXXX, I received a check for approximately {$XXXX}, which I believed at the time was a refund due to overpayment during the modification trial period. Upon receiving this check, I immediately contacted XXXX XXXX  to verify its nature and was informed that it was indeed a refund of overpaid amounts during the modification process. 

However, in XXXX, I received a 1099 form indicating that XXXX XXXX  had reported this refund as income rather than a return of funds that had already been taxed. Consequently, this caused me to owe taxes on the refunded amount, despite it being a repayment of my own funds. I promptly reported this income on my XXXX taxes as per the instructions provided by XXXX XXXX. 

Despite my efforts to resolve this issue, including multiple attempts to contact XXXX XXXX, I was unable to rectify the situation. XXXX XXXX  consistently maintained that the refunded amount was considered income and not eligible for correction. This misunderstanding has resulted in ongoing complications with the IRS, as I have been required to pay taxes on funds that were rightfully mine and already taxed. 
The situation escalated further in XXXX when I began experiencing difficulties in making timely mortgage payments. I approached XXXX XXXX  for assistance on multiple occasions, highlighting my confusion over being behind on payments when I had overpaid during the modification period. Unfortunately, my requests for assistance were repeatedly denied by XXXX XXXX. This led me to seeking legal counsel, and in XXXX, I filed a lawsuit against XXXX XXXX  in XXXX XXXX XXXX at the XXXX XXXX XXXX. The lawsuit was initiated to address the mishandling of my mortgage account and to prevent the wrongful sale of my home. 

During the legal proceedings, I discovered that my loan had been sold from XXXX XXXX  to XXXX XXXX  XXXX Despite the ongoing litigation, both banks proceeded with the sale of my home on XX/XX/XXXX, which resulted in it becoming bank owned. This action occurred while my case against XXXX XXXX  and XXXX XXXX  was still active and unresolved, which I believe violates legal protocols and my rights as a homeowner in XXXX. 

In late XXXX, my case against XXXX XXXX  XXXX which included SPS mortgage XXXX was settled in my favor. The settlement terms included a reduction of my interest rate from XXXX % to XXXX  % and a principal reduction of {$XXXX}. Despite the settlement, numerous issues have persisted that require immediate attention and resolution. 

Firstly, I discovered discrepancies regarding the title of my property. In early XXXX, when attempting to refinance my loan for a better rate, I was informed that the title listed XXXX XXXX XXXX  XXXX which was shocking to me. Upon contacting SPS, I was assured that the title was in fact under my name. However, subsequent attempts to refinance have revealed conflicting information from title companies, indicating that my title may not be properly registered in my name. I went to my local XXXX XXXX office and obtained official documents showing that the sale was rescinded but my title was not restored to me after XX/XX/XXXX. 

Furthermore, I found that SPS has been paying my XXXX  dues since XXXX, which typically occurs only when a property is bank-owned. This has resulted in an additional $ XXXX  monthly charge in my mortgage payment as it was added to my escrow account. Additionally, the property taxes have not been adjusted correctly following the erroneous bank sale in XXXX, and my property tax amount returned to before the sale. 

To exacerbate matters, in XXXX, I received a notice from the IRS claiming that I owed {$XXXX} due to the non-reporting of the principal reduction from my lawsuit settlement. It was explicitly agreed in writing during the settlement process and subsequent signed settlement paperwork that any 1099 forms would be suppressed for this reduction. This discrepancy led to a prolonged and challenging legal battle with the IRS, which took XXXX months to resolve. As a self-employed individual, this ordeal has had severe implications for both my personal finances and my business operations. 

Given these circumstances, I am reaching out to SPS to request your immediate assistance in resolving these ongoing issues. My loan is currently in default as of XXXX XXXX. I have asked for mortgage assistance and have been denied. There have been multiple oversights and errors that have significantly impacted on my financial stability and peace of mind. I am committed to bringing my mortgage into good standing and seek a prompt and correct resolution to the following matters : 1. Verification and correction of the title registration to ensure it reflects my ownership accurately.

2. Adjustment of my mortgage payment to remove the $ XXXX  monthly charge for XXXX dues, which should not be applicable. 
XXXX. Proper rectification of the property taxes to reflect pre XXXX sale amount and correct the ownership status and avoid further discrepancies. 
XXXX. Confirmation that no further IRS issues will arise regarding the settlement terms agreed upon in XXXX. 
XXXX. Apply any overages to my outstanding balance as my mortgage payment has been incorrect for over 5 years. 

I kindly request that SPS  prioritize this matter and provide me with a comprehensive plan for resolving these issues promptly and assist me in avoiding foreclosure. Please contact me at your earliest convenience to discuss the next steps and any documentation or information y

ou may require from my end. Thank you for your attention to this
urgent matter. I look forward to your swift response and a favorable resolution. 

Sincerely, XXXX XXXX

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation