Consumer complaint received 2025-11-29 00:00:00
Product: Mortgage — FHA mortgage
Issue: Closing on a mortgage — Fees or costs after closing
Company: Fay Servicing, LLC
State: CA

Complaint narrative:
On XX/XX/XXXX, at XXXX PST, I called Fay Servicing , LLC about my former loan, which was paid off through a wire transfer from my title company on XX/XX/XXXX, during the process of refinancing with a different lender. I spoke with a customer service agent to explain the situation as noted below. The agent informed me that she was unable to access the account because it had been paid off and closed. She then instructed me to send an email to Fay Servicing 's support team at XXXX. I sent an email at XXXX XXXX  that same day, XX/XX/XXXX, stating the following, and included a copy of Fay Servicing 's Payoff Statement and proof of the wire transfer from the title company : " I recently received notices and a demand for payment from HUD ( US Department of Housing and Urban Development ). The notices stated that I owe {$7700.00} as a result of refinancing my loan in XXXX. According to HUD, the {$7700.00} is still outstanding. However, as reported by my current lender and evidenced in the attached payoff statement and proof of wire transfer, this amount was included in the full payoff. Fay Servicing titled the payment as " Recoverable Corporate Advances, '' and this is the amount that was supposed to have been paid to HUD. Apparently, Fay Servicing , LLC did not forward that payment to HUD upon receipt of the loan payoff. Consequently, HUD has opened a collection offset against me. This action has resulted in a critical negative impact on my credit score and financial outlook, as HUD has promised to attach any available Federal monies to which I am entitled to settle a debt that actually belongs to Fay Servicing , LLC. 

I HEREBY REQUEST THAT FAY SERVICING , LLC, IMMEDIATELY PAY THE {$7700.00} TO HUD AND RELEASE ANY LIEN ( S ) AGAINST MY PROPERTY. '' On Tuesday, XX/XX/XXXX, I called Fay Servicing again and spoke with another customer service rep. I explained that I had called AND emailed on XX/XX/XXXX and had yet to receive a response. That rep was unable to locate my account and informed me that my " account was purged '' from their system at some point after the payoff. I was then transferred to another rep, XXXX, supposedly a manager. XXXX placed me on hold while she spoke with her manager, XXXX XXXX, Assistant AVP. XXXX then suggested that I call on Friday, XX/XX/XXXX, and provided me with XXXX XXXX ' phone number, stating that most staff were preparing to leave for the Thanksgiving holiday, but that the company would be open on the day after Thanksgiving. 

On Friday, XX/XX/XXXX, at XXXX XXXX, I called XXXX XXXX XXXX phone number, and after being transferred to her voicemail, I left a message summarizing the reason for my call and indicating the urgency. 

In my communications with staff at Fay Serving, I have expressed to each person that not only has Fay Serving failed to forward the funds they had been paid during the loan payoff and were thus obligated to forward to HUD, but that their negligence has had a critical impact on my life and financial outlook. Due to their failure to pay and the subsequent Treasury Offset levied against me by HUD, my credit score has dropped from nearly perfect to a XXXX decline. This entire situation has caused me severe, undue stress. 

If I am forced to pay the monies mentioned above to HUD, this will result in me paying XXXX, for a total of more than {$15000.00}. Fay Servicing needs to make this right, as the onus is on them because they did, in fact, receive the money that was earmarked for HUD.

Company response to consumer: Closed with explanation