Mortgage -- Trouble during payment process -- Complaint #6230941
Complaint Overview
Complaint ID: 6230941
Company: Flagstar Bank, N.A.
Product: Mortgage
Sub-Product: Conventional home mortgage
Issue: Trouble during payment process
State: Florida
ZIP Code: 33908
Date Received: 2022-11-21T12:00:00-05:00
Date Sent to Company: 2022-11-21T12:00:00-05:00
Company Response: Closed with explanation
Timely Response: Yes
Consumer Disputed: N/A
Submitted Via: Web
Consumer Narrative
My home was adjusted as a total loss to XXXX XXXX by XXXX XXXX through the XXXX. The claims checks are sent made out to ourselves and our loan servicer Flagstar Bank. Flagstar bank because my loan servicer after I closed on a refinance agreement with XXXX XXXX in XXXX. Flagstar bank requires that the insurance checks be sent to them where they hold them in escrow and then release on a schedule they see fit based on their own inspections determining that appropriate repairs have been completed on the home. We were required to sign a repair affidavit certifying we would use the funds to repair the home and submit all insurance XXXX paperwork to them to manage our claim. The insurance company has paid out {$220000.00} so far since XX/XX/XXXX and our home was completely gutted and ready for rebuild by XX/XX/XXXX. Flagstar bank however has only released {$40000.00} of these funds so far with another {$30000.00} expected to come by the end of XXXX. We are at a point where if we do not have access to all or most of the funds we will not be able to hire the contractors necessary to finish rebuilding our home. I can not find anything in my loan closing documents that shows I agreed to insurance claims being managed in this way with an escrow account, a long waiting period for release, and inspections done by inspectors hired by the loan servicer. XXXX claims it has federal authority to manage the claim this way, however I can not find any information in my documents that point out that governing statute or federal guideline. I also can not find anything in my loan documents that show I agreed to insurance claim management to be handled in this way. I understand a lender needs to protect its investment but I am concerned this servicer may be making money by holding money in escrow for an unnecccessary amount of time rather than releasing funds to homeowners to get repairs done quickly and efficiently. XXXX has not been able to show me in my documents or with specifics what gives them the ability to manage my claim this way. Thanks for looking into this for me.
Frequently Asked Questions
What is Complaint #6230941 about?
Complaint #6230941 was filed against Flagstar Bank, N.A. regarding Mortgage specifically about Trouble during payment process. It was received by the CFPB on 2022-11-21T12:00:00-05:00.
How did Flagstar Bank, N.A. respond to this complaint?
The company responded with: "Closed with explanation". The response was timely.
What is the risk level of this complaint?
See the risk assessment section for details on this complaint's risk profile.
How do I file a similar complaint?
You can file a complaint with the CFPB at consumerfinance.gov/complaint. Select the appropriate product category (Mortgage) and describe your issue in detail.
Can I see other complaints against Flagstar Bank, N.A.?
Yes, visit the Flagstar Bank, N.A. company profile at readthecomplaint.com/company/flagstar-bank-n-a to see all complaints, risk scores, and analysis.
Disclaimer
This analysis is AI-generated based on publicly available CFPB complaint data. It does not constitute financial or legal advice.