Flagstar Bank Incompetency Doesn't EVEN Begin to Describe It Troy, Michigan

We refinanced our home (not through Flagstar) October 2011 and opted to roll the taxes and insurance into the loan and receive our escrow amount refund from our previous lender. Our taxes for 2011 were paid in full in October. Flagstar bought our loan in November 2011 and paid the taxes again.

We were not notified that there was a deficit in our escrow account until November of 2012 and they wanted to raise our house payment almost $400 a month beginning in 2013. We contacted our original lender, received confirmation of the payment, as well as confirmation of the overpayment from our county tax office.

We immediately contacted Flagstar and our original loan officer was even kind enough to participate in a conference call with Flagstar and myself. At first, they told us the taxes would be a wash with the taxes for this year. Then we were told we had to verbally authorize Flagstar to request a refund from the tax office, which we did. This occurred in November.

Not surprisingly, the county tax office was slow to send out the check to Flagstar. They refused our January payment and turned us over to their annoying and rude collections department and are trying to charge us an almost $40 late fee. After admitting they overpaid the taxes, they still refuse to credit our payment to our account and have threatened to report us to the credit bureau.

In addition, they are holding the January payment in a forbearance suspense account which is almost $100 over the actual amount that was due. We pay an extra $100 every month towards the mortgage. Flagstar is demanding the additional $400 in order to rectify the situation. Seriously????

My husband finally found a county tax employee that was kind enough to apologize for the delay and informed us that the refund to Flagstar was approved in December, but a clerical error delayed the mailing of the check, which is scheduled to go out next week.

I have a few questions. First of all, what incompetent individual at Flagstar reviewed the closing documents on the original loan and missed the fact that the taxes had already been paid?

Why were we not notified in December of 2011 that there was a shortage in our escrow account so we could have solved the problem at that point?

Why did Flagstar not follow up on the refund request from the county that we had no control over?

Why are we being penalized for Flagstar's mistake when we make our payments not only on time, but pay an additional amount per month?

Who hires these rude and incompetent individuals that we have been having to deal with for the last 3 months?

Why is this bank still in business?

I refuse to pay the extra $400 and refuse to pay their late fee. I will spend the money to hire an attorney to deal with Flagstar before they receive an extra dime from me. We didn't choose Flagstar as a mortgage company, nor would we ever, especially after reading all of the complaints listed here.

We have spent countless hours, tolerated abusive phone calls, and experienced a huge amount of frustration attempting to correct a mistake that they made and that was completely out of our control. If anyone knows of a class action lawsuit please let me know. I will be more than happy to participate.

Please heed my advice, Stay Away From This Bank!!!!!!