Consumer complaint received 2019-02-10
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — 
Company: NAVY FEDERAL CREDIT UNION (IL)

I believe my bank, Navy Federal may be in violation of Regulation X, Real Estate Settlement Procedures Act and other LRR.

I recently purchased a home through Navy Federal, beside their processes clearly being broken, i.e., pulling my credit when applying for the loan with delays in getting back to me as far as any approval or next steps. Not sure if this falls under Regulation Z, Truth In Lending Act.

At any rate I believe a thorough investigation is needed to ensure that the bank if adhering to Laws, Rules and Regulations ( LRR ). I suspect I am not the only customer that is or has experience this, but I am aware that the CFPB investigates this types of discrepancies.

Background : I applied for a new mortgage loan with Navy Federal in XX/XX/XXXX, delays transpired with a representative contacting me although they were happy to charge me for pulling my credit.

Against, better judgment I decided to switch my lender to process my loan to Navy Federal, I informed them that I wanted a close date of XX/XX/XXXX. They ensured me that this is possible as it was greater than 30 days.

Fast forward to what I believe to be a violation, Reg X my initial closing disclosure was sent at the end of business XX/XX/XXXX for a closing on XX/XX/XXXX. As soon as I got the document I saw many huge errors, which raised concerns as the bank does closing disclosures all the time, I understand if the title company fees may be overstated as they are still working them out, but what I can not understand is the bank gun decking and not accurately reporting terms from the sale contract between myself and the seller. It took me less than 15 minutes to see the huge errors. I informed Navy Federal of this, they did not send an updated closing disclosure until end of business XX/XX/XXXX. These numbers were still incorrect and again took me minutes to see. I contacted the bank no one could explain the closing disclosure to me. My closing had already been set for XX/XX/XXXX at XXXX. So basically I was going into closing knowing that my bank had performed no due diligence on the closing disclosure which does not take long to execute. All the bank did was try to place blame on the title company, I am familiar with the process and understand the title company numbers are driven by the bank with the exception of the title companies fees, that being said why is Navy Federal conducted business in an unethical manner? Why are they lying to customers and why are they allowed to gun deck closing disclosure which I thought were to provide transparency in the mortgage process to the customer? The manner in which Navy Federal conducted business is the same that causes the mortgage crash in XX/XX/XXXX.

Navy Federal behavior led me to sitting in closing for over 5 hours because they elected not to adhere to LRR. Even after this was pointed out to them, they took their sweet time. At the closing we ( attorney, agent and myself ) had to continue to call and email the bank to see how they were correcting their numbers. It is like the bank had four days to get me an accurate closing disclosure. Why is Navy Federal allowed 4 days and other banks must provide it in 3 days? If the point of the closing disclosure is to provide borrowers with pertinent and timely disclosures regarding the nature and costs of the real estate settlement process. I do not believe that I was provided with pertinent and timely disclosures for the cost relating to my transaction. Navy Federal Closing Disclosures did not include all monies received by the borrower which proof was provided with enough time for the bank to have this properly documented. The title owner premium was spelled out in the contract as the seller fees, NF charged this to me on the CD. The seller was provided 3 % closing cost, NF elected to modify this without my approval or knowledge. I was not informed that a bank could modify the terms of a sales contract. I do understand that fees could be overstated ( title company ) but I was under the belief that the final closing disclosure should be relatively close, my was not. I have been in closing and small changes made which took minutes. Navy Federal mishaps should have never occurred these were on the bank, they gun deck the closing disclosure absolutely no due diligence.

I was charged twice for an appraisal, one which was authorized during the process and another NOT authorized charged after closing on XX/XX/XXXX. I am not sure if this falls under Reg X, but I am believe this is or should be a violation as well.

One of the issues that was pointed out in XX/XX/XXXX that it may be a surplus, in XX/XX/XXXX the bank stated that the surplus would go to principal payment. Even after I sat in closing for over 5 hours, Navy Federal overstated my principal payment to the credit bureaus, while not Reg X, I believe it is a LRR for this as well just unsure and do not have the bandwidth to find which LRR it falls under.

How is this bank allowed to do the aforesaid? I am fortunate to understand the process somewhat but most customers have no idea when their bank are not adhering LRR. This is not the manner any bank should function, I do not want any customer to have to experience the stress and any loss of money because Navy Federal believes that adhering to LRR is optional! My stress is not over as the bank is still not corrected the principal balance, it was on the updated closing disclosure how many screw ups are the banks allowed. Why am I the customer having to keep inspecting their work? At this rate I should be paid partial salary for hours spend on work that Navy Federal was supposed to do, they are not my employer.

Note : loss of money was due to sitting in closing for 5 hours while my movers had to wait around until Navy Federal corrected the closing disclosure.

I did contact the bank and detail how they failed see below, message to Navy Federal.

I am very dissatisfied with the service Navy Federal provided, this loan ended the same way it started with issues and poor customer service.

When I applied for the loan Navy Federal failed to reach out to move forward. When I was finally contacted XXXX was very rude and she hung up on me just because I asked her to repeat herself. Then an associate who stayed she was her boss called XXXX, we got through a lot of her questions we got disconnected I called back even left a voicemail but never heard from her. I had to contact Navy fed again since I was charged for credit pull and didn't receive any services for the pull.

Finally XXXX   XXXX reached out and expressed they were sorry for the events transpired. She stated Navy Federal wanted my business and would do what they could to turn things around as this is not how Navy Federal conduct business.

Perhaps this is my fault for believing Navy Federal would provide me a good experience after dropping the ball and I shouldve stayed with my initial lender XXXX XXXX. I was still afraid to switch and even during the process navy federal wasn't organized and didn't communicate well either.

1. From an organization perspective I the borrower had to initially stalk Navy Federal after the fees for credit pull was taking to get a status and to move the application along even with me asking for a rush.

2. Documents were constantly being requested that were previously sent which caused delays in processing.

3. Documents were being requested in one offs that are part of a process i.e., master condo policies COI etc. These were nothing specific to me as a buyer but as the banks process for Condos, so all documents should been have asked for up front same as the initial W2, tax documents.

4. The personnel that were processing the loan rarely acknowledge receipt of requested documents from buyer or agent office.

5. The condo questionnaire that was requested with less than a two day turnaround was sent them it sat on someone desk, no out of office reply alerting the agent office to contact someone else to keep the loan moving.

6. The asking for incorrect document needed again is like the bank had no clue on what is required for an internal process, creating more delays as everyone ( myself and agent office ) was very responsive with all request even those duplicated.

7. The initial cd was gun decked NO DUE DILIGENCE at all, I guess associates are more concerned about getting home than doing things correctly, as I got this at the end of business day. Then me as the borrower with 15min saw huge mistakes that took still took Navy Federal forever to correct. How can a borrower find errors quickly but associates that do this task day end and day out send one with so many errors?

8. The final disclosure was also incorrect AGAIN NO DUE DILIGENCE and sent at the very end of the work day 4:30 CST. No one could answer any questions to explain the CD to me. Then the blame game started with Navy Federal trying to put the items I had questions on to the title company. This is not my first closing, this is however the first time a lender was not able to answer my questions on the CD.

9. The day of closing the CD is still incorrect hold up my entire closing and the root cause goes back to the initial problem poor customer service. I sat in closing for over 5 hours, approximately 8:25-1:25 and all the documents were signed before 9am except for the closing disclosure.

We ( lawyer, agent and myself ) contacted Navy Federal immediately when the title company alerted us that Navy Federal was unwilling to make the changes needed. I made contact with XXXX  as he and XXXX were the associates that indicated that surplus would be appropriated to the loan amount. He answered his phone initially and we ( lawyer, agent and myself ) had to keep stalking/calling Navy Federal to see whats going on.

I heard from XXXX but as hours went passed I heard nothing from Navy Federal. When XXXX finally responded I finally hears back it was over 3 hours later after numerous emails and calls to the bank. I literally had to stalk Navy Federal which is exactly how my loan started. No apologies no update to keep me in the loop. The only updates I got was from the title company on all the bizarre changes Navy Federal was trying to do.

It is beyond my comprehension how the bank would change who pays the title owner premium as it is outlined in the contract. It is clear it is paid by the seller. In addition to the bank modifying number, they reduced the seller credit to me, again this is in the contract.

It was identified in the beginning ( XX/XX/XXXX) that it looks like there will be overage and in that event that occurred the remaining amount would be applied to the principal. This was stated in the very beginning XX/XX/XXXX and reiterated on XX/XX/XXXX in writing I have an email. As a customer I can not understand how my bank would do something like this to any customer and not even feel compelled to ever reach out and say something. The only time in over 4 hours I heard from the bank was when my agent or I called. Navy Federal mistake should not have been passed down to me and it also cost me money. Since Navy Federal decided to gun deck my loan, I had to pay those extra hours my movers while I was stuck in closing.

This was a quick fix. Move the title owners premium to the seller side as stated in the executed contract and update the seller credit back to the contract on the CD. Navy Federal credits could have simply been completed on Navy Federal after closing.

These are just a high level overview that capture some of the mishaps that occurred as I do not have the time to document them all since there were so many! Sending a CD should not be at the end of business day especially when it is already late. A CD should not take 3 days and on the 4th day my closing still be incorrect. I understand minor changes as I have seen them at previous closing but they were all resolved in minutes. I still regret choosing Navy Federal over XXXX, this was horrible experience and I would not wish this on anyone. Navy Federal has been my primary bank for years, it is apparent that I need to change that. I am beyond upset at how I was treated.

Navy Federal personnel I had interactions with during this loan, the behind the scene associates I do not know but as a group Navy Federal failed me big time and cost me more money as my movers were by the hour and Navy Federal took 4.5 of them minus the .5 that we actually signed documents.

Note : XXXX  was the only person to apologize although it was literally after sitting in the closing for over 4 hours, it was nice to hear someone say Navy Federal was at fault.

XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX XXXX ( do not have last name ) but he is the associate that kept telling the title company he didnt know how to do task.

XXXX ( She was XXXX  fill in person on Thursday as he was not there when the final CD was provided ).

XXXX XXXX XXXX XXXX manager I believe XXXX.