Consumer complaint received 2026-07-02 00:00:00
Product: Mortgage — VA mortgage
Issue: Struggling to pay mortgage — Applying for or obtaining a modification, forbearance plan, short sale, or deed-in-lieu
Company: Shellpoint Partners, LLC
State: TN

Complaint narrative:
Subject : XX/XX/XXXX Supplemental CFPB Complaint Against NewRez/Shellpoint Regarding Unfounded Escrow Increase, XXXX Confirmation , Manufactured Default, Payoff Obstruction, and Improper Liquidation/DIL Pressure To Whom It May Concern : I am submitting this supplemental complaint against NewRez LLC d/b/a Shellpoint Mortgage Servicing concerning my VA-backed mortgage loan for XXXX XXXX XXXX, XXXX, TN XXXX, Loan No. XXXX. This supplement concerns a new escrow development discovered on XX/XX/XXXX, involving NewRezs use of an XXXX homeowners insurance figure to create or justify an additional escrow burden. Today, XX/XX/XXXX, XXXX confirmed to us that NewRez/Shellpoint can not use the {$2800.00} XXXX insurance amount as a new or additional escrow charge because that annual premium has already been handled through the escrow/mortgagee billing process. XXXX confirmed that NewRezs use of that amount to create an additional escrow basis is unfounded. XXXX confirmation also undermines NewRez/Shellpoints prior escrow calculations that forced the loan into default. The XXXX documents support this. The Evidence of Insurance dated XX/XX/XXXX identifies the policy period as XX/XX/XXXX through XX/XX/XXXX, lists the annual premium as {$2800.00}, states the payor type is Escrow, and lists NEWREZ LLC XXXX XXXX as the mortgagee. The amended XXXX declaration also states the {$2800.00} is the total 12-month policy premium and expressly says, This is not a request for payment. Mortgagee has been billed. XXXX update letter states that the policy was updated effective XX/XX/XXXX and that the premium increased by {$400.00} for the current policy period. This means NewRez/Shellpoint appears to have taken a real annual insurance premium, stripped it from context, and used it to manufacture or support a new escrow/payment justification. The {$2800.00} is not a monthly payment, not a new borrower payment demand, not a separate additional escrow item, and not a new unpaid obligation outside the existing escrow process. It is an annual homeowners insurance premium, escrow-paid, with the mortgagee already billed. NewRezs own portal has created conflicting escrow narratives. One NewRez escrow screen states that the shortage was caused because taxes and/or insurance has changed, yet the projection table showed XXXX at {$2700.00} for the last 12 months and {$2700.00} for the next 12 months, with a {$0.00} difference. It also showed XXXX XXXX taxes at {$2300.00} for the last 12 months and {$2300.00} for the next 12 months, also with a {$0.00} difference. That means NewRezs stated explanation, taxes and/or insurance changed, conflicts with its own projection table. NewRezs portal now shows a negative escrow balance and a current escrow payment of {$870.00}, while also using XXXX insurance information to justify or reinforce the escrow increase. But XXXX has confirmed that NewRez can not use the {$2800.00} annual premium as a separate additional escrow demand because it has already been paid/accounted for through escrow. NewRezs use of that figure appears to be double counting, misapplication, or manipulation. This is not an isolated escrow question. NewRezs escrow calculations caused a payment increase, created unaffordability, and contributed to the default condition NewRez then used to pressure liquidation, payment assistance, deed-in-lieu, and surrender options. We previously told NewRez we would not sign a deed-in-lieu that offered no meaningful protection, no relocation assistance, no deficiency protection, no credit correction, no VA entitlement protection, and no resolution of the disputed escrow/payment figures. NewRez nevertheless continued to pursue liquidation-related conduct while failing to provide a clean and reliable explanation of the escrow account. This is especially serious because this is a VA-backed mortgage loan, and the escrow manipulation has affected default status, sale pressure, payoff reliability, bankruptcy harm, and VA entitlement risk. The regulatory issue is that escrow analyses are supposed to be based on actual or reasonably anticipated escrow disbursements. Regulation X requires escrow account analysis and annual escrow statements, and the analysis must itemize estimated taxes, insurance premiums, and other charges reasonably anticipated to be paid from escrow. NewRez can not use an already-paid or already-accounted-for annual insurance premium to create a second escrow obligation. Regulation X also requires servicers to respond to notices of error by correcting the error or conducting a reasonable investigation and providing a written explanation, including the reasons no error occurred and the borrowers right to request documents relied upon. NewRez has failed to provide a reliable explanation for the escrow shortage, the current escrow payment, the XXXX figures used, the prior {$2700.00} XXXX figure, and the basis for the claimed default. NewRez has also failed to timely provide a reliable payoff statement despite the urgent sale context. Federal mortgage servicing rules require a payoff statement within a reasonable time and generally no later than seven business days after a written request, subject to limited exceptions such as bankruptcy or foreclosure, where the statement still must be provided within a reasonable time. I ask CFPB to require NewRez/Shellpoint to provide the following : XXXX. The complete escrow transaction history from XX/XX/XXXX through present. XXXX. The complete escrow analysis worksheets for every escrow analysis or reanalysis performed in XXXX, including XX/XX/XXXX, XX/XX/XXXX, XXXX XXXX XXXX, and any later internal or portal recalculations. XXXX. The source document supporting NewRezs prior XXXX figure of {$2700.00}. XXXX. The source document and accounting basis for NewRezs use of the {$2800.00} XXXX annual premium. XXXX. Proof of whether the XXXX {$2800.00} premium was paid, when it was paid, from what account it was paid, and whether it was already accounted for in escrow. XXXX. A written explanation of why NewRezs portal stated taxes and/or insurance changed while the same projection table showed {$0.00} difference for both XXXX and XXXX XXXX XXXX XXXX. A written explanation of how NewRez calculated the current escrow payment of {$870.00}. XXXX. Immediate correction of any escrow overstatement, duplicate insurance charge, or unsupported shortage. XXXX. Immediate correction of the default status if the default was caused or materially worsened by NewRezs unsupported escrow calculations. XXXX. A reliable payoff statement suitable for closing, with escrow balance, fees, charges, bankruptcy coding, DIL fee, suspense/unapplied funds, and all corporate advances fully itemized. XXXX. Written confirmation that NewRez will not use a disputed, unfounded, or double-counted escrow figure to pressure deed-in-lieu, foreclosure, liquidation, sale obstruction, negative credit reporting, or VA claim activity. XXXX. Written confirmation that NewRez has notified VA Loan Guaranty of the corrected escrow/payment status and that no VA claim , foreclosure, or liquidation recommendation will rely on the disputed escrow calculations. NewRez/Shellpoints anticipated defense may be that it is permitted to project future escrow disbursements. That does not answer the issue. The issue is that NewRez appears to have used an already escrow-paid or already-accounted-for XXXX annual premium as if it supported a new additional escrow burden. XXXX has confirmed that NewRez can not use the {$2800.00} figure in that manner. NewRezs own portal also contradicts itself by claiming changed taxes/insurance while showing no change in taxes or insurance. This appears to be a manufactured escrow crisis. NewRez created or relied on unsupported escrow math, increased the payment, pushed the loan into default, then used that default pressure to pursue liquidation/DIL options while failing to provide a clean payoff or accurate accounting. This conduct has caused severe harm, including forced financial distress, bankruptcy consequences, sale uncertainty, VA entitlement risk, and loss of confidence in the payoff and escrow records. XXXX has also confirmed they are willing to testify to NewRez manipulating escrow based on unsupported insurance numbers. I request that CFPB treat this as an urgent mortgage servicing, escrow, payoff, and loss-mitigation complaint requiring immediate correction and production of the underlying source documents. Respectfully, XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX 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