Consumer complaint received 2017-04-25
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: JPMORGAN CHASE & CO. (FL)

Please accept this formal complaint on behalf of my client ( Client or Borrower ) regarding the malicious intent and willful misconduct exhibite d by Chase ( Chase or t he Bank ) during my Clients application for a mortgage loan and for the duration of the closing process for her refinance mortgage loan with the Bank. We have overwhelming support that clearly demonstrates repeated regulatory violation s by Chase during this transaction and, of which, are the basis for this complaint. The premise of the compla int lies in the damages faced by my Client as a result of delay tactics and other egregious behavior used by  Chase to p ersuade borrowers, including, but not limited to, my Client to walk away from loans when the Bank finds itself unwilling to honor rates that it had committed to.     At the onset, we would like to emphasize that there is no justifiable basis for  Chase to deny the loan to this Borrower who has timely complied with each and every request made by Chase, has the income and assets to support the debt service and has impeccable credit. Moreover, since Chase never intended to honor the terms originally committed to by them, they have intentionally failed to process the loan in c ompliance with Banking Regulations, including, but not limited to Regulation B and have also proceeded to k nowingly commit numerous TRID violations. This is a tactic which many of the loan officers that I work closely with ( and state that they have other borrowers with similar situations ) have advised me that Chase uses in order to frustrate their borrowers and force them to look elsewhere for a loan when they do  not want to proceed with under originally committed terms. The following is a timeline of the significant events that transpired with regards to the loan to my Client ( note that we followed up each and every week and any gap in such timeline does not indicate a failure to follow up on behalf of the  Borrower, but  a failure from the Bank to provide any information regarding the status of the loan ) :  XXXX   XXXX ,  XXXX  my  Client beg an the process of applying to refinance her new home wi th Chase .      Between  XXXX   XXXX ,  XXXX  and  XXXX   XXXX ,  XXXX , several emails went back and forth with the loan officer,  XXXX   XXXX , and a list of required documents was provided. The loan officer,  XXXX   XXXX  and  Borrower be gan to gather all information required.      XXXX   XXXX ,  XXXX  all of the required information was sent to the loan  officer. Included with the correspondence that attached such required information was an explanation that the Borrower would be applying for a refinance to pay off an existing private loan on the property and pay down a line of credit on another property ( which li  ne of credit funds were used to improve the property being given as collateral to the Bank ).       XXXX   XXXX ,  XXXX  an email was sent requesting the status of same.      XXXX   XXXX ,  XXXX  another email was sent requesting the status and the loa n officer  stated that disclosures had been sent out although they had not been received. Disclosures were finally received, but there were several mistakes noted on the documents.      XXXX   XXXX ,  XXXX  - Borrower received   a conditional approval with an interest rate of 3.875 % ( the correct interest rate ) and points of 0.250 % ( which the loan officer promised would be waived ). NOTE THAT A LOAN ESTIMATE WAS NEVER PROVIDED AS REQUIRED UNDER TRID WITHIN 3 DAYS FROM LOAN APPLICATION.       XXXX   XXXX ,  XXXX  and f or nine ( 9 ) consec utive days thereafter- emails were sent to the loan  officer requesti ng the status of the corrected lock in rate agreement and status of the loan.      XXXX   XXXX ,  XXXX  lock in rate agreement was received but same reflected higher points than what was on the conditional approval and initial documentation. The loan  officer assured the Client that those points would all be waived. AGAIN, AT THIS TIME, A LOAN ESTIMATE WAS NOT PROVIDED. Moreover, Borrower submitted additional documentation requested, including a letter of explanation stating what th e loan proceeds would be used for ( although there were several emails dated as early as  XXXX   XXXX  or before which included such information ).      XXXX   XXXX ,  XXXX   XXXX   XXXX   contacted Borrower for  a good faith payment which was essentially the cost of the appraisal wh ich Borrower paid by cre dit card over the phone.      XXXX   XXXX ,  XXXX   XXXX   XXXX ,  XXXX  Several emails were sent to the Bank during  such time ( note that at a minimum 1-2 emails are sent and 1-2 phone calls are made weekly to the Bank requesting the status of this lo an ). On  XXXX   XXXX ,  XXXX , the appraisal of the house was conducted.      XXXX   XXXX ,  XXXX  our law firm received a title request and the title commitment, preliminary CD, chain of title and prior survey were provided. Note that at such time, a tentative closing date had been set but n o Lenders Estimate had yet been issued to the Borrower.       XXXX   XXXX ,  XXXX  after many emails and phone calls, we received a  copy of the appraisal which indicated that the appraised value of the home was {$640000.00} ( higher than Client initially anticipated ). We immediately sent an email to the loan officer inquiring as to whether it would be possible to increase the loan amount from {$500000.00} to {$520000.00} based on the appraisal and the loan officer ,  XXXX   XXXX  responded with an email dated  XXXX   XXXX ,  XXXX , statin g Done. Loan amount increased to {$520000.00}. Again, no Lenders Estimate was issued at this time . After such date, the loan process stopped.     This firm and  the Borrower called 3-4 times a week and sent emails 3-4 times  a week requesting an explanation for such stall. During this time we also began copying  XXXX   XXXX ,  XXXX   XXXX   manager on t he correspondences and calling  XXXX   XXXX  but  XXXX   XXXX  never responded to any emails or telephone calls. The only information we were given at the time was that there was a technical issue and that the loan  officer would get back to us. Weeks passed, the Borrower and this firm  continued to call  XXXX   XXXX , the person who sent the initial title request and  XXXX   XXXX  to no avail. Client and I even reached out  to the manager of t he branch where  XXXX   XXXX  works and could not resolve the issue. The only correspondence or answers that we would receive stated that there was a technical issue and that  XXXX   XXXX  would not be responsible for the costs of extending the rate lock.      XXXX   XXXX ,  XXXX  Borrower contacted  XXXX   XXXX   XXXX  VP- Sr Lending  manager for South Florida .       XXXX   XXXX ,  XXXX  the technical issue was suddenly resolved.  XXXX   XXXX  was assigned to th e Borrower and the loan proceeded to move again. The Borrower  was required to resubmit all supporting documentation to the loan since all previously submitted documents were now stale.     Between  XXXX   XXXX ,  XXXX  and  XXXX   XXXX ,  XXXX  additional loan documentation and repeat loan documentation was provide d by Borrower . Durin g such time,  XXXX   XXXX  requested that  XXXX   XXXX  sign the application and we sent an email to  XXXX   XXXX  indicating that all of the information on the application was incorrect ( including the loan officers own name ). During this time,  XXXX   XXXX  began stating that they were waiting for underwriting to make a decision on t he loan ( Regulation B  violation ). We kept inquiring as to what this meant  since Borrower had  been conditionally approved since  XXXX . Several times during this process, we would send correspondence with complaints as to how this was being handled and no such complaints were ever addressed ( another regulatory violation ).      XXXX   XXXX ,  XXXX   Borrower received a c all from  XXXX   XXXX   to discus s how the loan proceeds were to be used. In such conversatio n, Borrower was told that the loan amount would be in the mid $ 300,000s ( below the jumbo loan limit and about {$200000.00} less than the original and revised loan amounts ). Again, all do cuments still included the original loan amount of {$500000.00} and we had correspondence from  XXXX   XXXX  stating  Done.  Loan amount increased to {$520000.00}. Never had a reduction in the loan amount been discussed. After such conversation, this firm sent a correspondence to  XXXX   XXXX ,  XXXX   XXXX ,  XXXX   XXXX  and  XXXX   XXXX  setting forth the violations above and below. Such correspondence included reference to the use of the proceeds  ( to pay o ff the private lender and pay down the line of credit ). No action was taken, as with any previous complaints ( regulatory violation ).      XXXX   XXXX ,  XXXX   XXXX   XXXX  and  XXXX   XXXX   called Borrower to state  that they were unaware of the private lender and that same would change the terms of the loan ( please note above that there were emails dated as far back as  XXXX   XXXX ,  XXXX  explaining how the proceeds would be used, there was a letter of explanation that was part of the loan file which stated that the proceeds were to be used to pay the private lender and the title commitment provided in  XXXX   ( and co rrespondence accompanying same ) shows the mortgage   to be satisfied by the private lender ). This was further evidence that Chase had not even reviewed the loan documentation provided and had no intention of honoring the loan terms and closing on the loan per the originally committed terms. Please further note that to date, a Lenders Estimate has never been provided.
This Lenders behavior amounts to malicious intent and willfu  l misconduct. Chases blatant disregard for banking regulations is inexcusable. My Client has suffered extensive damages due to this Banks delays and deceit including, but not limited to, paying higher interest rates on the private loan encumbering her primary home, default rates and penalties on the payoff of the private loan  ( due solely  to this delay and the fact that the loan has matured, not due to any defaults within the control of the Borrower ), extensive legal fees and costs, repeat costs of updating title and lien searches for closing, a substantial increase in rates which she would have to bear if she can not close on this loan ( which amounts to sums in excess of {$75000.00} over the life of the loan ), etc.. The foregoing does not even include the costs and expenses incurred b  y Borrower should the private lender foreclose on the property ( which has more than {$350000.00} in equity and is Borrowers homestead ) due to Chases inexcusable delay tactics.
All of the foregoing demonstrate that Chase never had any intention of closing the loan on the original committed terms. When Chase believed they may be forced to close the loan or in a further attempt to have the Borrower walk away, they decided to reduce the loan amount to an amount under a jumbo loan in an effort to curtail the exposure of having to honor a 3.875 % interest rate for a jumbo loan amount of 80 % LTV or in a further effort to have the Borrower walk away. We have correspondence which support all allegations contained herein although we have attached only a few. Please advise if you require same or any additional information. The conduct exhibited by Chase during this transaction is, without question, reprehensible. We kindly ask that as the Bureau   charged with protecting consumers financial interests and protecting consumers against unfair, deceptive and abusive practices, you investigate the foregoing, assist us in obtaining a favorable and just resolution for my client, and rem ind Chase th at this behavior, unbecoming of a leading global financial institution, can not be tolerated on this loan or with any other future dealings with consumers.