Consumer complaint received 2019-07-05
Company: U.S. BANCORP
State: WA
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Closing on a mortgage

Complaint:
My Complaint against US Bank loan originator XXXX XXXX XXXX or US Bank Home Mortgage : XXXX XXXX packed my mortgage with mortgage escrow services without informing me that the low rates he was quoting were contingent upon the loan having escrow services. He did this despite my informing him that we wanted a conventional mortgage with no added fees or escrow services. He concealed that fact that he intended the loan to have mortgage escrow services until I was fully engaged in a contract to purchase a home. Once I discovered that XXXX XXXX intended my loan to have escrow services, I immediately informed him in writing that I did not want escrow services. A conversation ensued, and I was told by XXXX XXXX that escrow services would be removed from the final loan paperwork. Despite my withholding of the signed mortgage application, XXXX  authorized the ordering of an appraisal for the contract to purchase the home which created further contractual obligations. I asked that the appraisal be postponed, but US Bank did not stop the appraisal. I identified multiple factual errors in this appraisal to XXXX XXXX, and he and US Bank refused to nullify or redo the appraisal. The loan processing was not complete by the first closing date, and it was not complete by the extended closing date, and we were forced to either waive all contingencies to our earnest money or possibly loose the right to purchase the home due to these delays. A third closing date of XX/XX/XXXX was agreed upon by the sellers. XXXX XXXX did not send me the final loan documents for review prior to closing. He sent the documents to the title insurance company one day prior to closing on XX/XX/XXXX. My closing appointment on XX/XX/XXXX was my first opportunity to review the documents, including the new GFE that he had dated XX/XX/XXXX. I observed that XXXX XXXX had setup the new GFE to include escrow services despite our agreement that it would not. At closing, prior to signing the documents, the closing officer and I called and spoke to the loan processor, XXXX XXXX. My wife was also present for this phone call. I informed XXXX that my loan was not supposed to have escrow services attached. She told us that the GFE could not be changed without further delaying the closing date. I asked if we would be able to cancel the escrow account after the loan was processed, and if there would be any fees for cancellation. She informed us that the escrow services could be canceled/waived after the loan was active for 12 months. She stated that there was not fee to waive the escrow services. Her comments were supported by the loan documents, which also did not state that a fee would be required to cancel escrow services. We had no other choice but to precede with the loan which included the GFE that XXXX XXXX had prepared despite this being against our wishes and unnecessary given our down payment and good credit history. I believe XXXX XXXX deliberately caused us to enter into a loan with escrow services for his own benefit, despite these services not being required or requested. We signed closing documents and paid our loan as agreed. In XX/XX/XXXX US Bank refused to allow me to have an escrow waiver without paying a fee of approximately {$1100.00}. My loan closing documents do not state that I am required to pay a fee for the removal of escrow services. I contested US Banks right to charge me this fee, and I remain in a disagreement with US Bank regarding my consumer rights. Here is the timeline of events : XX/XX/XXXXXXXX I began shopping for a mortgage loan. I made preliminary application without authorization to pull my credit with US Bank in order to obtain a per-qualification letter which I received on XX/XX/XXXX. I indicated that I would be placing a 20-30 % down payment and other details. XXXX XXXX sent me a prequalification letter that did not state that the rate he was quoting was contingent upon escrow services. I did not request mortgage escrow service on the account, and no statement was made by XXXX XXXX that mortgage escrow was a condition of the loan. I made an offer was made on a home, I did not pursue the counter offer. 

XXXX, XXXX : I sold property and paid-off an existing US Bank mortgage that had no escrow services over the life of the loan. 

XXXX, XXXX : I continued to shop mortgage lenders for better rates, and look for a home. 
Early XXXX, XXXX : I requested a new per-qualification letter from XXXX XXXX specific to an offer I intended to make on a home purchase. XXXX XXXX e-mailed a new per-qualification letter at a new and improved interest rate, and the letter also did not state that the rate he was quoting was contingent upon escrow services. This prequalification letter was used to make an offer on my current home. A counter offer was made, which was accepted by the sellers. Again, no information was provided or implied by XXXX XXXX that the rate or loan was contingent upon escrow services throughout this process. 

XX/XX/XXXX: On XX/XX/XXXX XXXX XXXX e-mailed me that I was locked in at a rate of 3.625 % for 30 years. He did not inform me that this rate was contingent upon my acceptance of mortgage escrow services. He required a credit card number in order to secure the lock-in the rate. Around XX/XX/XXXX XXXX XXXX used XXXX or XXXX to send me a formal loan application to sign and I observed that the GFE included with the application indicated that the loan would include escrow services. On XX/XX/XXXX after reviewing the paperwork, I e-mailed XXXX XXXX that I had not previously been made aware that his loan included escrow services, I did not want escrow services, and I believed that I was not required to have escrow services. I subsequently had a phone conversation with XXXX XXXX that I did not want escrow services for my mortgage loan, and that I if I was to proceed with US Bank this would need to be removed from my loan. XXXX XXXX agreed and told me that the final loan paperwork and GFE would not have escrow services. I told him that I would not be returning the GFE with the loan application. Prior to calling XXXX XXXX I checked with other mortgage companies to see if they could process a loan quickly enough to meet the sales contract requirements. The other lenders said that they had competing rates but could not process the loan quickly enough at that point. I did not return the mortgage application at that time, but continued with the property inspection. On XX/XX/XXXX I e-mailed XXXX XXXX and said that the contract may not precede contingent upon the sellers agreement to make specific repairs. 

XXXX, XXXX : On XX/XX/XXXX I informed XXXX XXXX that the repairs in question were major. On XX/XX/XXXX XXXX XXXX loan processor e-mailed me that she had not received my signed loan application, but had already sent other documentation to the underwriter. On XX/XX/XXXX I replied to XXXX XXXX and his loan processor that due to inspection related issues there was a strong possibility that the terms of the inspection resolution will not be accepted, which will be the end of the transaction. In the e-mail I state that I had told XXXX XXXX I did not want to proceed with the appraisal until the contract is free of hurdles. On XX/XX/XXXX XXXX XXXX loan processor told me that she canceled the appraisal she had scheduled for XX/XX/XXXX. On XX/XX/XXXX I replied to this e-mail stating that I did not authorize payment to the appraisal company, and that I had forwarded this information to the real estate agent the prior day as she had requested. I had not sent back my signed loan application at that point, and XXXX XXXX did not have my consent to order this appraisal. Despite communicating my wishes to XXXX XXXX to cancel the unauthorized appraisal that he had ordered, the appraiser performed an appraisal on XX/XX/XXXX. Around XX/XX/XXXX the sellers agreed to an acceptable inspection resolution. On XX/XX/XXXX after receiving a copy of the unauthorized appraisal, I e-mailed XXXX XXXX loan processor that the appraisal contained factual errors, and XXXX XXXX called later that day to discuss after reviewing the report. After that conversation I e-mailed a list of the errors on the appraisal and informed XXXX XXXX that my primary concern was the accuracy of the appraisal to justify the high price we were paying for the home. The appraisal listed the home as having several expensive features that the home did not possess. I asked XXXX XXXX to have the home re-appraise and reminded him that the current appraiser proceeded without authorization. XXXX XXXX e-mailed that he had asked the appraisal group to see about getting a revision/correction. Because the unauthorized appraisal was above the price that we had offered for the home, we lost our right to contest the homes value or further counter offer. ON XX/XX/XXXX XXXX XXXX loan processor told me that she was again contacting the appraisal company again, but also needed me to return the signed loan application in order to meet the deadlines for closing. On XX/XX/XXXX I e-mailed her the requested documents, including my signed loan application. I did not return the erroneous GFE but was told I had to sign the truth-in-lending-disclosure that was marked initial back on XX/XX/XXXX. On XX/XX/XXXX XXXX XXXX loan processor e-mailed me a response from the appraisal company saying that they will not reconsider another appraisal. I subsequently spoke to XXXX XXXX who stated that nothing more could be done on this matter. Over the next two days I received multiple requests for documentation that I felt I had previously requested. This made me question whether the loan had actually been in the underwriting process as previously stated, or if XXXX XXXX was lying about this and the appraisal process to further entrap me into proceeding. We had to get an extension to the original closing date due to further documentation requests by US Bank. The sellers agreed to the initial extension. 

XX/XX/XXXX: loan processing delays caused us to miss our extension closing date. The sellers would not agree to another closing date unless I waived my contingencies. 

XX/XX/XXXX : XXXX XXXX forwarded me a Commitment letter by e-mail. This was the only official loan document that I received from US Bank prior to closing on XX/XX/XXXX. The document said nothing about escrow services, so I believed that XXXX XXXX had performed as agreed and removed this unwanted and unnecessary contingency. 

XX/XX/XXXX : USB sent the closing company the official closing documents, the documents were not sent to me from US Bank by e-mail or mail. I did not even know the final amount for the proceeds. 

XX/XX/XXXX : I presented for closing document signatures as described in my complaint paragraph. As described above, XXXX XXXX loan processor told me that she could not correct the errors in the final GFE without returning to her underwriter for the new documents, and that doing this would cause a further delay in closing. She told me that I would need to keep escrow services for twelve months, and then I would be able to waive escrow services without a fee. 

XXXX, XXXX : A US Bank customer service/escrow representative told me that a fee of approximately {$1100.00} would be necessary in order to waive escrow services. I was told that the fee amounted to an interest penalty of 0.25 %. I told them that I had a no-penalty loan and that this fee was not enumerated in any agreement that I was given or signed at closing. I also told them that I had not been pleased with the accounting of the US Bank escrow department and provided a few specific examples. They told me that I could write or e-mail US Bank a complaint to seek a resolution. I called ( no return call ) and then e-mailed XXXX XXXX for his assistance in resolving this matter that he created. He replied that I should contact customer support. I later called and spoke with XXXX XXXX, he said that he processes so many loans and could not recall the specific details of my loan. 

XXXX, XXXXPresent : I wrote US bank to cancel my escrow account without a fee and explained how I was lead to believe by XXXX XXXX that escrow services would not be part of my final loan documentation, and that I was further told by XXXX XXXX loan processor after discovering the error at closing, that there would not be any fee associated with closing/waiving the escrow services. This e-mail was received by US Bank, but I did not receive a timely reply, so I contacted customer support. Customer support reviewed my loan history and submitted letter, and determined that I should not have been required to have escrow services, and that escrow services would be waived from my account without a fee. I followed up with US Bank to make sure that this process was proceeding, and it was. I later discovered that the US Bank escrow department overturned this customer service decision and was still demanding I pay a fee. They reported my account as delinquent to the credit bureaus and have caused me significant consumer and personal harm. I have obliged to their process to resolve my compliant, yet XXXX XXXX or US Bank has provided me with no fair resolution options. 

I was led into this transaction by XXXX XXXX and his US Bank associates and it was not what I expected. I believe that he used bait-and-switch and loan packing methods in order to obtain a large commission on a loan irrespective of my wishes and requirements. I believe he may have illegally authorized the appraisal on my behalf in order to further lock me into his business transaction. 

I have copies of all e-mails and documents that I have reference in this complaint.

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 non-monetary relief