Consumer complaint received 2018-06-04
Company: Evergreen Moneysource Mortgage Company
State: WA
Product: Mortgage
Sub-product: FHA mortgage
Issue: Closing on a mortgage

Complaint:
Our FHA Loan closed on XX/XX/XXXX and XXXX XXXX XXXX XXXX ( XXXX ) was in charge of the Escrow Closing. Our Escrow Agent, XXXX XXXX, was signed on as of XX/XX/XXXXto handle ALL documents, funds and payments of Escrow. XXXX XXXX DID NOT finish Escrow and allowed the Lender, XXXX XXXX  ( XXXX ) to receive funds and waive our rights to a final inspection, without our knowledge, causing us severe damages. These damages could have been prevented, if she would have followed ALL instructions at Closing. XXXX XXXX  allowed XXXX  to waive our final inspection REQUIRED after " works '' for Repairs were done.

XXXX waived this right on XX/XX/XXXX without disclosing this to us. It wasn't until I did a QWR inXX/XX/XXXX that this was finally disclosed to us. All changes to the Purchase and Sell Agreement had to be in writing. I have asked both XXXX and XXXX for the disclosures to show they put the waiver of the final inspection by the ORIGINAL inspector in writing and neither company can provide this. The Holdback agreement for repairs states : " Another inspection, completed by the original inspector AND satisfactory to the Lender will be required, before ANY funds SHALL be disbursed by the Escrow Account. '' XXXX XXXX   released funds to XXXX on the Closing Date XX/XX/XXXX. Repairs were not finished until XX/XX/XXXX, therefore violating her Escrow agreement with us.

XXXX was to disburse ALL funds by ESCROW CHECK or Wire Transfer to the contractors, brokers, etc. XXXX is a third party that was not allowed to receive funds for other contractors, unless we gave them specific instructions and disclosed on closing documents. Since this was not done. This gave XXXX   the power of Fiduciary over our loan and the capability to be self-serving and protect their interests, not ours. Any changes to the contract had to be approved by us in writing. The Holdback agreement was updated by XXXX on XX/XX/XXXX, and signed by us. At this time, the final inspection and 1004D appraisal were still required. They did not disclose they had already waived our right to the final inspection or that XXXX would not require one to be done for the water intrusion damages. It took us 4 years to figure out why the " works '' were never inspected, as required by ALL contracts.

These water intrusion damages have affected our living conditions with mold, moisture and possible structural damages. It is clear in ALL directions that XXXX is to issue ALL checks directly from Escrow. XXXX  had sole authority over the Holdback agreement, ONLY because XXXX-XXXX XXXX  gave them that authority. If the requirements were followed, XXXX would have had to sign the holdback to release funds after the inspections were completed, state who did the final inspection, then funds would have been released from Escrow to the Contractors after the Mechanic Liens were checked for. The Seller and Buyer agreed that ALL REPRESENTATIONS AND INFORMATION regarding the PROPERTY and TRANSACTION are SOLELY FROM THE SELLER AND BUYER. How did XXXX breach Escrow? How did they convince XXXX XXXX to release funds that did not belong to them? This would take collusion on both sides and is very self serving.

We put our trust into XXXX and XXXX to do what was in our best interest at all times. Waiving final inspections without disclosing it to us and taking funds from Escrow and giving it to the Lender, without prior disclosure or our permission, is a breach of escrow. This allowed XXXX to finagle receipts and numbers, waive final inspections and do what was in their best interest, ignoring what was in the best interest of the client. XXXX would NOT ACCEPT ANY RECEIPTS THAT DID NOT MATCH THE ESTIMATES GIVEN BY CONTRACTORS. If there were any further damages found, ( which there were prior to the works being done and reported to XXXX ) XXXX was required to charge the Buyers to fix the repairs CORRECTLY. How did XXXX know REPAIRS WERE DONE CORRECTLY IN A COMMERCIALLY REASONABLE MANNER, AS REQUIRED IN THE PURCHASE AGREEMENT? The final inspection was required to make sure ALL repairs were done CORRECTLY. XXXX stating The XXXX inspection was good enough is a breach of our contract with XXXX. They knew as of XX/XX/XXXX( 3 working days after closing ) there were further damages found and this loan would fail if they did the final inspection and a 1004D appraisal. They should have demanded the inspections were done and ALL damages were fixed correctly. We would have been required to pay for the damages and would have fought this battle back in XX/XX/XXXX, saving us years of pain and suffering. Our insurance company would have been called in and disclosed to us that it was the HOAs responsibility. Instead, we were told we would have to give ALL money back to the SELLER and pay for ALL DAMAGES ourselves and XXXX could put a lien on our home.

XXXX  had NO RIGHT to WAIVE OUR RIGHTS EVER!! They certainly did not have our permissions to waive or change the contracts as written or NOT DISCLOSE THESE CHANGES TO US PRIOR TO CLOSING. XXXX is using these same damages that they DID NOT INSPECT, TO FORECLOSE ON US AND PROFIT FROM OUR DEMISE. Their failure to disclose they waived our final inspection, prior to closing has left us in a home that we can not sell. I have sent QWRs and they have denied to fill them out claiming they are unduly burdensome, proprietary, or beyond their scope permitted. They DID NOT REPLY in the timely manner permitted by law. I have requested the collection calls stop. The agents will not speak to us, but harass us. I have requested they call my attorney, yet XXXX  ignores this and calls us every day. We have done this in writing to XXXX XXXX, who has handled our complaint from the beginning. I sent the QWR to the proper place, certified mail and they acted as if they never received it, violating RESPA. This company harasses and ignores their clients best interests.

Company public response: Company believes it acted appropriately as authorized by contract or law
Company response to consumer: Closed with explanation