Consumer complaint received 2017-07-31
Company: Southwest Business Corporation
State: TN
Product: Mortgage
Sub-product: FHA mortgage
Issue: Closing on a mortgage

Complaint:
SWBC Mortgage did not answer or address my questions or my complaint. Instead of looking at the Closing Disclosure and investigating the disbursement of the lender credit SWBC is attempting to blame the shortage on an insurance payment sent to the insurance company. SWBC did not apply the lender credit to my Property Taxes or my Escrow Account in the amount of {$1800.00} in section G of the Closing Disclosure. I was told that lender credit would go to my property taxes escrow. It is listed in the Closing Disclosure to be applied to my property taxes. However no lender credit in the amount of {$1800.00} was applied to my property taxes or deposited into my escrow account. The shortage is not due to the insurance payment its due to me not receiving the lender credit in the amount of {$1800.00}. The shortage occurred in XXXX 2016 when SWBC paid my property taxes and no lender credit had been applied to my property taxes or the escrow account. In exchange for a higher interest rate I was supposed to receive Lender Credits totaling {$5000.00} and I did not receive a total of {$5000.00} in Lender Credits from SWBC Mortgage. SWBC made a vague and general statement  about lender credits being applied for administrative fees but there is no accounting for the specific lender credit of {$1800.00} for property taxes. That Lender Credit was never placed in my escrow account to assist with the payment of my property taxes. Since I did not get {$5000.00} in Lender Credits I should either receive the lower interest rate or Lender Credit either needs to be applied to the escrow account or I should be reimbursed. The APR is understated and the Finance charge is understated based on the calculations out of APRWIN the OCC Application to test the accuracy of the APR and the Finance Charge. The reason that my APR and Finance Charge is understated is because SWBC failed to include the FHA mortgage insurance as a finance charge for the life of the loan. An FHA mortgage includes both an upfront cost, paid as part of your closing costs, and a monthly cost, included in the monthly payment.My LTV is greater than 90 % and mortgage insurance premium will be paid for the life of the loan. My APR was understated by .3904 % and the Finance Charge was understated by {$32000.00}. My Total of Payments on the Closing Disclosure is {$640000.00} but it shouldve been {$670000.00}. The Finance Charge was disclosed {$310000.00} but it shouldve been disclosed as {$340000.00}. The response and reasons that SWBC listed as to why my APR & Finance Charges are not understated was not sufficient. SWBC has not provided the calculations, disbursements, or accounting of points,  fees, of what was a finance charge. The response did not even discuss the mortgage insurance premium being calculated as a finance charge. I should be reimbursed. A mortgage loan originator should not get to pass responsibility to Title Companies, Brokers, and sub-servicers that they chose to conduct business. I did not choose XXXX XXXX for title or my closing services. SWBC chose XXXX XXXX. Failure to provide all disclosed Lender Credits is a violation of Truth in Lending Act. This is also a breach of contract because I did not get the benefit of my bargain. I was told that I would receive {$5000.00} in Lender Credits at the Loan Estimate and specifically disclosed that a Lender Credit would be applied to my property taxes and in exchange for that I took a higher interest rate.

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