Consumer complaint received 2024-10-11
Product: Mortgage — Conventional home mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — Changes in loan terms during the application process
Company: GUARANTEED RATE INC. (CA)

At the beginning of the process, around XX/XX/XXXX, XXXX stated that there will be no PMI on our loan because an affordable loan to value will be used. 
We were initially looking at XXXX other lenders, some with better rates and lower lender fees, but chose Rate because of this - despite their higher lender fee and higher interest rate. 

XX/XX/XXXX, I confirm with XXXX that the No PMI will not change due to some other unforeseen fact. 
He confirms that hes 99 % sure. 

XX/XX/XXXX, Rate orders a second appraisal and it comes back with the amount needed to remove PMI. 

XX/XX/XXXX XXXX provides two scenarios - Option XXXX - XXXX rate, with PMI today at XXXX XXXX 97 % loan. Option XXXX XXXX rate, no pmi today at market value, 3 % down. We qualify for Option XXXX. I ask how much PMI will be, just in case. There is no response. 

XX/XX/XXXX, in the same email thread as the one previously where he sent the rates, and the one that he did not respond to my last question of how much PMI would be- I ask him to confirm that we will be getting the XXXX interest rate and no PMI. 
His response is that it will be lower. 

XX/XX/XXXX, I reach out asking about my interest rate because another person from his team informs me that the interest rate has been locked to XXXX. 
I did not receive a heads up or an explanation that something has changed from three days ago - so I reach out to XXXX. 

XX/XX/XXXX, XXXX responds saying it was denied by the underwriter due to having to use the affordable loan to value. 
My file has been with the underwriter since XX/XX/XXXX. XXXX should have checked with them before providing interest rates and then confirming that it will be lower. 


XX/XX/XXXX, after XXXX goes back on his word of giving us a lower interest rate, I atleast try to confirm that the no PMI still stands, because it is a big reason why we continued this process with XXXX. He responds that he can not exclude it unless we put more money down - we all know that you have to put at least 20 % down to get PMI removed, but that is not the basis for what we have been discussing. Then he states IF the property was affordable-eligible then, PMI could be removed. He did not state that at the start of this process. He only mentioned if we used the affordable loan to value then PMI would be removed- which is what was being used. At the start of this process, I even explicitly asked if there would be other factors would change our removal of PMI - and he did not disclose any. He only provided decision altering information when it was too late for us to pivot to another lender. 


XX/XX/XXXX - XXXX expressed my frustrations around the false commitments, the poor communication, the lack of communication of the changes, and all around frustrations through the process, and asked that they at least reconsider our interest rate. 


XX/XX/XXXX XXXX opening response is that he sent us the interest rates Before he knew it was not affordable eligible. And that knowing that it was not affordable eligible changes the interest rate. However, he sent us the lower interest rates after he knew it was not affordable eligible. 


He knew it was not affordable eligible on XX/XX/XXXX and then he confirmed interest rates would be lower on XX/XX/XXXX. 


XX/XX/XXXX- then a day after, I receive a disclosure of the unexpected higher interest rate. And a PMI estimate of {$140.00}. 
XXXX bank another lender I was working with had a PMI estimate of {$88.00}. XXXX XXXX had better rates, better service, and lower lender fees. I would have saved money and had so much less daily stress than working with XXXX. This has been the most stressful 60 days of working with him - the poor/lack of communication, the anxiety of not knowing what is true and what is not, and having to proactively follow up with him and his team. 
XXXX XXXX  had lower PMI rate, lower lender fees, and was offering a Lender credit. 




Conclusion. 
XXXX has communicated a lot of false promises which were the basis of why we picked him as a lender. We missed out on lender credits, lower PMI rates, and lower interest rates because of the false promises made by XXXX. He should have done his due diligence before communicating any numbers to us or assuming anything about our loan to us. He has strung us along, leaving us XXXX  in the process, and dragging out the process which didnt leave us enough time to pivot to another lender. Not knowing where our loan stands on a day to day basis, and what was holding up the process- has been a daily stressor for us, and has taken up a lot of my personal time since I had to be the one proactively checking in on what the roadblocks were or what the status of our loan was. The cherry on top of it all was having to ask if we would close on time XXXX weeks after we signed our initial disclosures - he did not explain the process, or ever brought up the roadblocks, or followed up on things that he said he would - until I asked - this has truly been the most unpleasant, and unprofessional experience I have had. Almost 60 days later, its still unclear if we are approved for the loan and when our new closing date will be because of their delay.