Consumer complaint received 2017-09-10
Company: Stearns Ventures, LLC
State: AZ
Product: Mortgage
Sub-product: FHA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage

Complaint:
My husband and I first applied for a mortgage through XXXX XXXX XXXX on XXXX XXXX, XXXX. We wanted to build a new home with XXXX XXXX in XXXX AZ. We were told we qualified for the Home Plus Program and would be eligible for 3 % down payment assistance. We were conditionally prequalified based on information provided and needed to provide supporting documentation in order to receive an approval. Our prequalification letter stated a loan processor would be in touch. The prequalification letter also states that " it does not guarantee loan approval or is it a commitment to make a loan at the rate and terms stated ''. We were to be working with XXXX XXXX. We paid XXXX  XXXX a {$1500.00} escrow deposit in two {$750.00} installments. I submitted the requested documentation in order to gain loan approval from XXXX XXXXXXXX XXXX on XXXX XXXX, XXXX. I called and emailed asking on approval status. I did not hear anything again until XXXX XXXX, XXXX when we were informed that Home Community Mortgage was no longer in business, that it had been absorbed by Stearns Lending, LLC and that we would have to re-apply through Stearns Lending, LLC. We were also told that they would not be able to use the credit score that was pulled on XXXX XXXX because it was more than 30 days old. When our credit reports were pulled again, the pull resulted in both our scores dropping more than 20 points. When I was finally able to talk with a loan processor, I was told that my husband and I made too much money to qualify for the Home Plus Program and that we would need to come up with 3 % for the down payment. This upset us both because we feel this should have been addressed before we paid the {$1500.00} in escrow deposit money. We also felt that pulling our credit files twice was unfair as now we were working with lower scores and a higher interest rate with Stearns Mortgage. We did n't sign the loan application on XXXX XXXX, XXXX because the information I had given to the loan processor was listed incorrectly on the Uniform Residential Loan Application. My husband 's name was incorrect and my husband 's company name was also incorrect. We were told to sign anyway and it would be fixed, but I refused to sign until it was corrected. It took several emails and the information was n't corrected until XXXX XXXX, XXXX. That 's the first time both my husband and I docusigned the application. We had an appointment at the Design Center on XXXX XXXX, XXXX. We went into the design center to pick out the options for our new home. We reluctantly paid an additional {$1800.00} at the Design  Center in spite of the fact that we still had not received a loan approval. Paying the additional money without yet having a full approval was very concerning to us both. I continued to call and email our loan processor to find out the status of our loan. I received no response until XXXX XXXX when the loan processor emailed to say he would reach out to me that night. I never received a phone call. I later found out he had gone on vacation and left without making contact. I waited until after XXXX to start calling and emailing him again requesting an update on the status of our loan. I was getting very nervous that the builder was breaking ground and starting to build our home and we still had not received a loan approval. The builder started building our home in XXXX XXXX. I did not receive any sort of response from the loan processor until XXXX XXXX, XXXX. The loan processor was requesting additional information from us via email. Also, we received a redisclousre package that needed to be docusigned. I let him know that the amounts listed were incorrect. He did not have the accurate amount listed for our escrow deposit and he still had the original loan amount before the selections at the design studio listed in the paperwork. He had not updated any of the documentation at all in the time since the amendment to the purchase agreement was signed ; which was XXXX XXXX, XXXX. We also received an email on XXXX XXXX, XXXX stating that we would need to close my husband 's previous self employment company. My husband and I thought this was an odd request seeing as he was no longer self employed and closing the business at that time would close the door on a future income from side and weekend work. We told the processor we would not be closing the company and were told that in order for the loan to be approved through Stearns this would have to be done. I was so beyond frustrated at this point! In addition to the news about the LLC, we received a closing addendum showing that we would need to come up with approx. {$5000.00} more than we were originally told. My husband and I decided to seek a second opinion and met with another lender on XXXX XXXX. We were told that we would not need to close the company business. So, we started the loan process with the other company. We received a prequalification from them as well and started to move forward with an approval. I emailed Stearns Lending on XXXX XXXX, XXXX to inform our loan processor that we would not be moving forward with a loan through Stearns only to receive an automatic reply back stating they had moved to a new company which was now XXXX XXXX XXXX XXXX, an affiliate of XXXX XXXX and Stearns Lending LLC. So, I forwarded my email onto the new address also to be sure they received it. My husband and I also received packets in the mail that same day with new lending documents inside. The amounts listed on those brand new loan documents were STILL incorrect. None of the amounts had been updated ; even after I had brought it to their attention several times. I received no response from my email to XXXX XXXX at Stearns Lending or XXXX XXXX Loans. I also forwarded that email to our sales rep at XXXX XXXX and she said she forwarded it to her sales management, but I received no response from XXXX XXXX either. In trying to work with the new lender, we needed to get information and final numbers from XXXX XXXX so we could get a loan approval. The new lender emailed XXXX XXXX several times requesting the final amounts and paperwork and it was n't received until XXXX XXXX. When the new lender calculated the numbers and costs associated with the loan, it ended up that we could not afford to continue with the home build. We did not have enough money for the down payment and closing costs. He could not approve us. We reached out to our sales rep at XXXX XXXX to get our deposit money back but they refused. The sales contract we signed stated that the deposit money was refundable if we did not receive loan approval. They still refused to reimburse us. I called and asked to speak with the regional sales manager, XXXX XXXX. He and I spoke via phone on XXXX XXXX, XXXX. He stated that there would not be a refund given to us because we had loan approval. After explaining that we never received a loan approval, only a prequalification, he stated that he felt a prequalification was an approval. He also stated that if we could not continue with the process of purchasing the house, we would be required to sign a cancellation. If we did not sign a cancellation and did not close on the house, we would be responsible for all costs associated with the remarketing of the house. I emailed XXXX XXXX and asked for a copy of the loan approval. He provided me with a screen shot of an approval, however, the approval is dated XXXX XXXX, XXXX. I find it very very hard to believe that we could receive a loan approval ( 1 ) after I emailed them on XXXX XXXX, XXXX and told them we would n't be using them and ( 2 ) because it was made clear that we would not receive the loan approval without closing my husband 's company. I feel this approval was fabricated after my conversations with our sales rep and with XXXX XXXX requesting our deposit monies back. By this time, my husband and I are at the point where we just wanted to be done with the whole process so we signed the cancellation. After completing the cancellation, I feel this was a scare tactic used by XXXX XXXX in order to get us to sign the cancellation. We feel extremely taken advantage of and feel as if both the builder and the builder 's lending company took us for a ride. We were jerked around so much from the lending experience to the closing date. We will never be able to recoup our time, but certainly feel our deposit should be reimbursed. We never received an approval needed to meet the contractual financing contingency. This alone should have been sufficient reason for the refund of the deposit monies. In addition, in all of our dealings with Home Community Mortgage, Stearns Lending and finally XXXX XXXX Loans, we never received a Notice of Incompleteness. This is also reason for us to be refunded our deposit monies. This whole ordeal has put a huge strain on our marriage. We are still very upset and feel that XXXX XXXX took no accountability in this matter.

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