Quote from @Noah P Bonds:
One of my loans was taken over servicing by Shellpoint. Since then it's been a pita for the last 6-8 months. Essentially my taxes suddenly weren't being paid and they subsequently lowered my escrow payment. I initially found out because my county began sending me delinquent notices. After many attempts to explain this to Shellpoint they finally have readjusted the escrow payment to an even larger than initial amount. I have been trying to explain this to them since January - it's taken them until June. I had sent them the delinquent notices from the county at least two times. My initial piti payment was 8,870 now it will be 10,359.To make matters more messy I changed insurance during this time - they repeatedly sent me notices that they did not have proof of insurance...I had my insurance rep send them the docs several times before they finally acknowledged the new insurance. I don't know if this is worth pursuing but I feel like they've really dropped the ball over and over. I'm guessing It's not worth it, but I would like to hear if anyone has ever sued a loan servicer and what they outcome was.
I'm a bank and I get sued all the time. I also manage the insurance and escrow department for my bank and while we make mistakes, we fix them and we make sure we pay for any penalties if its our fault. I've had to pay for some insurance premiums and some late penalties on property taxes but i can say, I've never been successfully sued in 15 years, because our process is well documented and its not a pattern or pervasive or malicious in intent (Some elements needed to sue in my opinion) if we make a mistake and, I've always made the borrower whole. Shellpoint is a LOT bigger than my bank so, I'm guessing they probably have a decent process in place as well?
I'm guessing you have some of the pieces but not all of it? Servicers don't typically just stop impounding for taxes and insurance, if they have impounded in the past. The only why my company stops is by written instruction to cancel. In fact, some states require the borrower to cancel impounds in writing before the lenders/servicer is allowed to cancel so, if they cancelled and you didn't instruct them to, ok maybe they are negligent. However, they cured their negligence by reinstating the impounds for taxes.
For the most part, they should pay for any penalties from the tax authority but at the end of the day, if you weren't paying for the taxes through escrow, and they weren't disbursing to the tax authority, but now you are and now they have, it makes sense the payment went up because they are covering the shortage for the period you weren't paying. If you were paying into the impound account this whole time, that's another story.
The same goes for insurance. You say your agent sent them proof of insurance but yeah, for 15 years I've heard that story and the agent is usually the one dropping the ball. At the end of the day, you changed insurance. If you can document your previous policy (Exhibit A) was from (As an exampled) 03/01/2023-03/01/2024 and your replacement policy (Exhibit B) was from 03/01/2024-03/01/2025, that's it, that's all you need. Those two declaration pages with coverage periods are all you need to document no lapse in coverage. That said, you must also meet the coverage requirements, loss payee/mortgagee clauses, deductible requirements, etc.. If you had no gap in coverage, the lender cannot make you pay for any gap coverage or force placed coverage. They can charge you a million bucks for a force placed policy but you'll get a 100% refund in my scenario. Shellpoint is smart enough not to double cover and try to charge for it.
If you're just pissed you had to send it several times but it got taken care of ultimate, yeah it sucks but, you aren't going to prevail in any lawsuit. What harm or loss did you suffer? File a complaint with your state agency or their regulatory agency or the FDIC and move on.
