Consumer complaint received 2017-02-13
Product: Mortgage — Conventional adjustable mortgage (ARM)
Issue: Settlement process and costs — 
Company: CAPITAL ONE FINANCIAL CORPORATION (KS)

XX/XX/XXXX, I received an online notification of a pending rate increase on our home mortgage as we had a 5 year ARM due to expire XX/XX/XXXX. I started researching current rates, considering refinancing for a shorter fixed term of 15 years. 
In the end, it made sense to just do a rate renewal with our existing Mortgage holder, Capital ONE 360 and pay more principal each month. After looking at various fees, closing costs and our best guess on how long we planned on remaining in our current home, the rate renewal seemed like the best option. Our rate was going to go up of course from 2.75 % to 3.125 %. 

Knowing interest rates had increased slightly, we were willing to live with the slight increase as it would only make sense to refinance for a fixed shorter term if we planned to stay in our current home for more than 5 years. 

I completed the online rate renewal XX/XX/XXXX, well in advance of the pending rate change. The fee for the rate renewal was one extra months payment. However, we received notice online XX/XX/XXXX, stating our rate was going to 4.125 %, a full point higher, thus increasing our mortgage payment by more than we had budgeted. 

I called to express my confusion and concern. My complaints fell on deaf ears, as they said, we never signed the rate renewal paperwork. I explained, I completed it online, and was not aware of any additional paperwork. Their reply was, you were notified online when you agreed to the rate renewal there would be paperwork sent to you which had to be signed to make it official. We have no record of ever receiving a written agreement, as I was told over the phone, the rate renewal could be simply completed from our online account. 

Even if there was a document sent, there was no follow-up, no phone call, no email, no further communication regarding a signature page required to make the rate renewal official. So three months passed after thinking the rate renewal was complete, while their AUTOMATED SYSTEM generously raised our interest rate by a full point increasing our monthly payment significantly. 

I filed a complaint with Capital ONE 's " Consumer Advocacy '' department, explaining, I fulling anticipated the rate renewal we agreed upon at 3.125 % would go into effect at the end of our existing 5 year ARM ( XX/XX/XXXX ). The Advocate seem " genuinely '' concerned, but NEVER called me back with a decision. So, after several more days, I called and received the same reply, sorry, you did n't sign the rate renewal paperwork, but you can apply for a rate renewal again at 3.75 %, better than 4.125, but still not the rate we agreed upon ( 3.125 ) when I initially applied for the rate renewal. 

I find this practice unethical, as I fully agreed to their terms, and clicked and signed online to renew my existing ARM at a slightly higher rate ( 3.125 % ). I would not have agreed to anything higher, because at the time there were competitive rates available. WE have been loyal customers, always made our payments on time, and have our auto loan with CapitalOne as well. 
They do not seem to really care, and my next mortgage and any future loans will be negotiated with a local lender. I am also a small business owner and was recommended to look into CapitalOne for a small business account for credit cards and online management tools. Probably not going to happen. They know they have us in a box because it does n't make sense for us to refinance our existing mortgage due to closing costs on a relatively small mortgage. WE have equity in our home, but do not expect to be in our home more than a few more years.