Consumer complaint received 2017-12-07
Company: WELLS FARGO & COMPANY
State: NJ
Product: Mortgage
Sub-product: Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage

Complaint:
I am writing to file a complaint about the refinancing of my existing mortgage with Wells Fargo. 

I began my application in XX/XX/XXXX. Currently, I am attempting to refinance my mortgage in order to lower the interest rate. My current mortgage has a high rate of 6.375 %. I signed a rate lock that was offered by Wells Fargo of 3.625 %. As a result, my monthly payment will be reduced substantially by almost {$2000.00}. The big reduction in the interest rate is clearly in the best interest of the consumer and will help me a great deal financially in fact its a game changer for me financially. Banks like Wells Fargo claim that they focus on doing whats best for the consumer. That is NOT the case here. 

I am not asking for any additional money from Wells Fargo. I currently have a first mortgage and a HELOC from Wells Fargo from when I originally purchased the home. I am just consolidating the two mortgages. The only party that benefits from me not refinancing is Wells Fargo as they can continue to hold my current mortgage at an above market rate. 

My credit profile is very strong. My credit score is XXXX based on a range from XXXX to XXXX. My debt to income is 42 %. I have basically no other debt except for the mortgage. My loan to value is also 67 %. The cash in my bank account and my other assets are well over the 12 months liquidity required by the bank. In summary, I meet all the credit metrics required for the loan. 

I have always responded quickly and have supplied many pages of documentation in a timely manner when asked over the course of several months. At last count, I have submitted over 40 pieces of documentation including my tax returns. I believe I have satisfied all the documentation requests that were required based on my conversations with the loan officer and processor of the mortgage. As proof of this, the first underwriter did approve the mortgage in XX/XX/XXXX. 

However, an issue arose when it was sent up the approval chain. This is the point at which I believe Im being treated unfairly. 

The original underwriter for this refinancing spent two months reviewing my application before giving his approval. Meanwhile, the second underwriter spent 1 day before denying my application. The short amount of time spent on the application by the second underwriter was very concerning. I would have expected a more thorough analysis like the first underwriter rather than a relatively quick judgement. 
As background, this is the second time I am applying for a refinancing with Wells Fargo. The first time, I was not approved for the refinancing ; the reason that I was given was that my debt to income ratio was too high. I subsequently cured this issue by paying down almost all the non housing debt and thereby lowering my debt to income to acceptable levels. 

Based on my current, cured credit profile, I more than meet the qualifications for the new refinancing. However, Wells Fargo is basing the current denial of the refinancing on my prior application. For example, the actual cash and assets in my accounts more than meet the 12 months liquidity requirement. Despite the seasoned nature of the assets ( I have 2 months of statements showing the liquidity ), Wells is reducing the liquidity number based on my last mortgage application. 

Also, the second underwriter has called out the purely subjective rationale of layered risk as a basis for a denial. Again, this is based on my prior application before I took the necessary steps to cure my profile. 

So Wells Fargo is moving the goal posts on me even though I fixed the original issue. 

That is a big reason why I think Wells is treating me unfairly. If I fixed the issue I had before, but Im still going to get denied on the same issues, what reasonable person would go back to Wells Fargo to reapply? No one at Wells Fargo gave me any indication that I would have NO chance to succeed on the second attempt. If I thought that I would have issues related to the prior application, I would not have wasted months of time and effort and would have instead gone to another bank. Not only have I wasted time, but I will have spent extra money with the delay with my elevated interest payments and the fact that rates have gone up since my application. 

In fact, if Wells did not have any history of my first refinancing attempt, I am certain that I would have been successfully approved and closed by now. Thats the question for Wells : based on my most recent data and documentation, would I have been approved? Everything else is water under the bridge, just like with any other new applicant off the street. Instead, my loyalty has cost me dearly now. 

Importantly, I understand that exceptions are granted on a regular basis for other borrowers. As you see, I have a number of compensating factors, especially considering my current credit profile. The only issue is that they are relying solely on old data to make the current decision to deny my refinancing ( which benefits Wells Fargo as the holder of my current above market rate mortgage ). 

I am shocked by Wells Fargos behavior in this matter. I am a long time loyal customer that has a spotless history with Wells. I am seeking to improve my financial condition just by lowering my interest payments to a market level that we agreed upon. So it is clearly in the best interests of myself as a consumer. My credit profile is strong and the refinancing will only improve my financial condition. I am not asking for additional funds from XXXX outside of my current mortgage balances. I meet the legal qualifications for a mortgage. I have provided all the documentation requested in a timely manner. The refinancing was already approved by an underwriter at Wells. I feel that the deck is stacked against me, while Wells Fargo continues to collect above market interest.

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 explanation