Consumer complaint received 2017-01-29
Company: NOVA Financial & Investment Corporation
State: AZ
Product: Mortgage
Sub-product: VA mortgage
Issue: Application, originator, mortgage broker

Complaint:
To Whom It May Concern, I am XXXX & I am writing this complain in regards to a home loan Nova Home Loans was preparing for me. I was working w/ Loan Officer XXXX ( NMLS XXXX ), & I believe he used unprofessional & potentially exploitative business practices. My complaint centers around 2 issues : false representation of an interest rate ( IR ) " bait & switch '' ( B & S ) sales practice ; & exploitive & potentially fraudulent increase of an IR just to increase originator fee. His B & S tactic might potentially cost us losing the house my wife & I fell in love w/ & have an accepted purchase contract on. If that happens I will seek legal counsel for restitution & losses. 

" Bait & Switch '' Sales Practice : My wife & I set out to sell our current home & buy a new home this year. I shopped around for competitive IRs & XXXX verbally committed, during a phone call on XX/XX/XXXX, to a 3.75 % IR. He did communicate the IR was not locked but would work to beat any IR I found. The IR XXXX quoted me matched a very competitive IR I found at XXXX ( XXXX ). Since my real estate agent had a good working relationship w/ XXXX & his IR matched XXXX I decided to proceed w/ Nova. I made it specifically clear, in a follow-up phone call on XX/XX/XXXX, I was shopping around & I would only stay w/ Nova if he could beat any IR I found, & XXXX again committed to 3.75 % IR, so I decided to move forward w/ Nova. 
On XX/XX/XXXX, XXXX furnished a Loan Estimate ( LE ) via regular mail which had 3.75 % IR. At that time my wife & I have not found a house yet. On XX/XX/XXXX, I returned the completed loan packet to XXXX. On XX/XX/XXXX we put an offer on a house that was later accepted on XX/XX/XXXX at XXXX. XXXX furnished another LE via regular mail dated XX/XX/XXXX which still had 3.75 % IR on it. On XX/XX/XXXX at XXXX, XXXX emailed me saying the market changed & the IR for my VA loan was 4.125 % ; which, is a difference of $ XXXX & a total of {$40000.00} different over the life of the loan. 
My concern does not have to do w/ the fact that the market changed. I 'm pragmatic, I understand IRs change. My complaint centers around the timing of the communication of the change. The market had been changing for weeks. The home mortgage IRs do not jump 3/8 % in a day. The timing seemed like a B & S. Anyone who works home loans knows timelines are tight. If XXXX had communicated anything different earlier, I could have switched to XXXX w/o concern of losing the house. XXXX waited until the very last minute to communicate the IR increased, when I had no other alternative. 

Exploitive & Potential Fraudulent Increase of IR : Additionally I am concern XXXX may have fraudulently increased quoted IR to increase originator fee for Nova 's & his benefit. Before XXXX emailed me w/ a 4.125 % IR, I told him I wanted to buy down points. Directly after, the quoted IR jumped, as illustrated by the difference in provided LEs, communicating 3.75 %, & the email on XX/XX/XXXX showing 4.125 % & lt ; 24 hours later. 
On XX/XX/XXXX at XXXX XXXX emailed me a screen shot from XXXX XXXX showing that an offer at 4 % interest rate. XXXX thought I was quoting a more competitive IR from XXXX as I bank w/ XXXX . This demonstrates that XXXX knew the IR he quoted from Nova was n't competitive, which further shows he had no intention of being competitive like he originally communicated at the onset of the loan process. The appearance is XXXX increased the IR knowing I was willing to buy down points to increase originator fees to get to a more competitive IR. The fact XXXX had all my financial records put him in a strong position to know who I might get a better IR from & what I theoretically could afford in originator fees. Knowingly offering less competitive IR to increase buy down points & originator fees runs contradictory to implied fiduciary responsibilities of a loan officer & even sounds criminal.

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