Consumer complaint received 2022-04-11
Company: Better Mortgage, Inc.
State: IL
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage

Complaint:
To Whom it May Concern XX/XX/XXXX I applied for the mortgage at Better.com : created an account online and spoke with an Associate Home Advisor ( XXXX XXXX, XXXX  # XXXX ). I completed my tasks at Better.com account, uploading the requested documents, and at XX/XX/XXXX XXXX XXXX I have received a Verified Pre-Approved Letter from a loan consultant ( XXXX XXXX, XXXX  # XXXX ). The letter has the following statement : We have been able to verify you for the full purchase price of {$350000.00} you requested. According to the Better.com XXXX public disclosure, they issue a verified pre-approval letter after verifying all the assets and executing a hard credit inquiry. All these steps were successfully completed. 

Surprisingly, at XX/XX/XXXX XXXX XXXX  XXXX Ive received another follow-up from XXXX XXXX XXXX requesting me to sign in person and re-upload my XXXX and XXXX tax returns. I followed, and the requested documents were re-uploaded to better.com. After a series of other requests, which were meticulously fulfilled on my end, Ive received another verified pre-approval letter from XXXX XXXX, this time it was for {$340000.00}. 

With that verified letter, I began to shop for a property in XXXX, WI and vicinity. It worth to mention that at this moment in time I was not only satisfying these requirements, but actually had more cash on hand and an excellent ( above 790 ) credit score. Moreover, for the first quarter of XXXX my business net sales were over {$35000.00}. 
At this point, I already had some concerns about the Better.coms ability to issue the loan. I send an additional request, asking the following : What are the chances that my loan will not be issued after receiving a verified pre-approval letter from you? What can be the reason for it? XX/XX/XXXX XXXX XXXX  XXXX Ive got a written confirmation from XXXX XXXX, an Associate Home Advisor. XXXX XXXX stated the following : ======= When a verified pre-approval is issued, it means our underwriting team as reviewed your income and assets and can be certain that they are all verified. This means that as long as your information does not change, we will be able to move forward with approval amount given. What may change, however, is if you place an offer at the full amount you are approved for, and we find that the actual taxes and insurance is higher than what we had estimated in your monthly payments. Your verified pre-approval amount is based on the given daily rates, as well as the taxes/insurance estimated. As the market fluctuates and changes, this can also change the amount you are able to afford. These are the two factors that can hold us up later in processing if you look to purchase a home at the absolute maximum you have been verified for. 
====== I was completely satisfied by that answer and continued with the shopping. A few days later I realized that I must add another state to the search Michigan, XXXX XXXX area, because the available houses in XXXX, WI are at scarce. I contacted Better.com, requesting another application for Michigan. I contacted XXXX XXXX again and I was assured that the pre-approved amount will be the same, plus/minus some difference due to the local taxes and insurance rates. However, after submitting all the same information for the new application, I suddenly got the following from XXXX XXXX : ===== I discussed further with the team, and the information you were given that the Wisconsin pre-approval amount was still valid was only based on the 1 year average of your income. While the system can work off of a 1 yr average of income in some instances, the daily rates, final debt to income ratio, as well as the credit report received combined required us to use the 2 year average to ensure we were within compliance for lending. Due to this, we would be unable to move forward with the current purchase price listed on the file, as it would need to be closer to $ XXXX. 
===== A two-fold difference for the same applicant in two neighboring states triggered my next request to Better.com to verify that they will be able to honor their {$340000.00} pre-approval letter for Wisconsin. XX/XX/XXXX XXXXXXXX XXXX  XXXX Ive got the following from XXXX XXXX : === At this point, the desktop underwriter system required us to then use the 2yr average, as to compensate for the risk factor of having the debt-to-income so close to maximum 50 %. Running through text scenarios, the software showed us that we could possibly still use that 1 yr average on your income if you were planning on putting down 20 % for your purchase. As it stand now with just using your current information and planned down payment, we would need to use the 2 yr average instead.

=== All this time Ive been shopping around, assuming that the verified ( XXXX ) pre-approval letter means something, knowing that my financial picture is even better than at the moment of application. I traveled over XXXX miles, touring the properties. I spend countless hours, analyzing the listings. And I did some offers using the better.com verified pre-approval letter. If any of these offers could be accepted, Id lose the earnest money deposit ( {$3000.00} ) due to my inability to purchase.

At this moment in time, I already had ( and I still have ) other pre-approvals from the competitors : XXXX : {$300000.00} XXXX XXXX : {$290000.00} ( Michigan ) That makes me think that my fair, asset-backed loan amount lays somewhere within $ XXXX range. I believe that Better.com intentionally misled me, issuing the verified pre-approval letter, having no intention to honor it at the final stage of the closing process. 

I accuse better.com and its employees in the following : false advertising in the written form intentional misleading discrimination, both the social-based and occupation-based unprofessional behavior that constitutes a significant financial risk to the customer violation of the Equal Credit Opportunity Act misreporting customer account status false written statements about their ability to offer a loan Employees of concern : XXXX XXXX, Loan Consultant XXXX XXXX XXXX XXXX XXXX XXXX Associate Home Advisor XXXX  # XXXX XXXX XXXX, Home Advisor , XXXX  # XXXX XXXX XXXX, Client Success Associate

Company response to consumer: Closed with explanation