Consumer complaint received 2020-05-26
Company: PNC Bank N.A.
State: FL
Product: Mortgage
Sub-product: VA mortgage
Issue: Struggling to pay mortgage

Complaint:
The loan servicer/lender has failed to operate under good faith and fair dealing and that it has unclean hands because it has not made a reasonable effort to abide by the U.S. Department of Veterans Affairs ( VA ) Regulations, Statute, and Guidelines. VA Mortgagees are legally obligated to offer and/or grant VAs recommended loss-mitigation to veteran borrowers prior to initiating foreclosure proceedings. Servicers/lenders have a responsibility to both the Veteran and the VA. Specifically, VA requires servicers to : act in the best interest of Veterans and the Government, service VA loans to the highest standard, respond timely to Veteran and VA requests, pursue collection and loss mitigation efforts with a focus on home retention, provide timely and accurate data to VA and the Veteran, comply with all applicable laws, regulations, manuals, and formal guidance. 
The servicer/lender in this case has been in complete disregard of the VA Regulations, Statute and Guidelines. The promissory note and mortgage attached to the foreclosure complaint provide that the loan at issue is guaranteed and insured by the VA. The note and mortgage specifically provide that any of their provisions that are inconsistent with the VA statute or regulations are amended and supplemented to conform thereto. These documents specifically incorporate into their terms certain federal regulations issued under the VA guaranteed Loan Authority ( Title 38, Chapter 37, United States Code ) that govern the rights, duties, and liabilities of the parties to the loan. Title 38, Section 36.4350, Code of Federal Regulations, titled Servicing procedure for holders, requires that the holder of a loan guaranteed or insured by the VA must develop and maintain a loan servicing program and specifically sets forth certain minimum actions that a holder must include in its collection procedures against borrowers in various stages of delinquency. The foreclosure complaint established that we defaulted on the note and mortgage by failing to pay the monthly installment payment due on XX/XX/2011. Based on the age of the loan, 38 C.F.R. 36.4350 ( g ) ( 1 ) ( iv ) required that a letter be sent by, or on behalf of, the  servicer within 82 days after this payment was due. This regulation also required that the letter contain certain mandatory language that, among other things, warns the veteran about the possibility of losing the entitlement to a future VA loan guaranty and gives direction as to how to obtain assistance and information directly from the VA to discuss options to reinstate the loan. See C.F.R. 3650 ( g ) ( 1 ) ( iv ) ( B ). The servicer/lender/holder failed to comply with statutory conditions precedent of 38 C.F.R. 36.4350 by failing to provide a timely and proper notice and an opportunity to cure the default. 
VA encourages servicers/lenders to consider loss mitigation options that allow the Veteran to retain their home. The servicer/lender failed to approach me on all home retention options and more specifically on a loan modification. VA requires Servicers/lenders to review the modification option that is most appropriate for the borrowers circumstances. In my case, the servicer/lender neglected to inquire about my circumstances and neglected to review the modification options to determine the one that was most appropriate to my situation. Servicers/lenders are encouraged to continue solicitation of a modification throughout the borrowers delinquency and the foreclosure process. But, in my case the servicer/lender again neglected to continue the solicitation and to give me the opportunity of a modification.

Company response to consumer: Closed with explanation