Consumer complaint received 2019-01-19
Product: Mortgage — VA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — 
Company: UNITED SERVICES AUTOMOBILE ASSOCIATION (IL)

My wife and I were trying to build a new home in XX/XX/2018. We contacted USAA and were assigned a mortgage agent named XXXX XXXX. From the very beginning we informed XXXX that we wanted to construct a new home. We also informed him that we have a POA which allows me to collect my wifes income for the purpose of paying and obtaining new debts. The POA is a general durable POA which names me as my wifes official payee to collect all of her income as if it were my own. ( Since putting the POA in place, I have been able to pay down my wifes debt and raise her credit scores quickly ). We spoke with XXXX about our unique income situation on recorded calls several times. We discussed our hesitation to apply for a loan unless our POA would be recognized and our income would be recognized as my own. My wife and I are both XXXX veterans and receive VA XXXX income. My wife is XXXX XXXX XXXX and recieves more VA income than me. We also work part time as independent contractors for food delivery services for extra income. After emailing our VA XXXX award letter amounts and POA to his email we were verbally informed over the phone that he would have his underwriters and attorney review the POA and whether our income would be recognized as my own. After some time we received verbal confirmation that documents were shown to the underwriters and attorney and that there wasnt a problem with the POA. My wife and I then decided to get preapproved and look for a home. USAA and XXXX XXXX ran our credit and preapproved us for {$180000.00}. At this point, in XX/XX/2018, we informed him that we were interested in building a home. We found a property and travelled to its location to make sure the property was as advertised online and that we wanted to live there. We found out that we needed to use a contractor that has a VA builder ID. We found one. We emailed XXXX the VA builder ID for our contractor. We were told by the owner of the property that we needed to put earnest money down on the vacant land in the amount of XXXX $ and that we would have to hire civil engineers to create a lot exhibit and residential land survey. We paid {$360.00} for the land survey and {$120.00} for the lot exhibit. We also had to travel from Illinois to South Dakota to meet with VA contractor twice to discuss where the best location to build the home would be and to draft up the instruction contract estimate for XXXX XXXX. At this point, XXXX had recieved all documents and knew exactly what our intentions were. In good faith we shared all this information with XXXX and send him emails informing him that the cost would be closer to {$200000.00}. XXXX informed us that the borrowed amount could be increased. I asked again if our income and POA were going to be okay and was verbally told on a recorded line that it looked okay and that our income was okay. We paid the engineers and the earnest money to the seller. When it came time to apply for the mortgage, I was told on the phone that USAA doesnt do construction loans I would have to find a construction loan. This was a shock for my wife and I because he knew from the beginning that we were constructing a home and we had already provided him with our contractors VA builder ID. My wife and I were referred to XXXX XXXX XXXX XXXX by our VA contractor. After speaking XXXX XXXX at XXXX, we were told that they were not going to give us a loan or recognize our POA for income. This was XX/XX/2018 and one month before closing. My wife and I asked WHY our POA was not being honored and XXXX refused to put into writing why they were discriminating our POA. They stopped answering our calls and we lost the property. My wife and I were devastated. We had already lost {$1000.00} from travel and civil engineering expenses. Our preapproval expired on XX/XX/XXXX. My wife and I feel that we were mislead from the very beginning because he knew that we were building a home and he told us that USAA doesnt fund construction loans. 
XXXX said we could find an existing home instead but our preapproval expired XX/XX/XXXX. On XX/XX/XXXX we found a different home and made an offer on XX/XX/XXXX. We contacted the realtor and put {$1000.00} earnest money down the new house we found. We paid {$300.00} for the home inspection and {$180.00} for the radon test. We also found home insurance and changed insurance companies to satisfy the closing. XXXX said that we had to suffer ANOTHER hard inquiry in order to process our mortgage application. My wife and I were very upset about this because we had already suffered a hard inquiry for the preapproval. Before this whole process my scores were XXXX XXXX and XXXX. We were told by one of XXXX underwriters that the application itself was hard inquiry. And we were forced to run our credit again if we wanted to purchase the home and submit the loan. I told the underwriter my concerns over the recorded phone call that I didnt want to submit to another credit check unless everything else with our application was okay ie : the POA and our imcome. The underwriter said that he couldnt do anything unless we filled out the mortgage application. I recieved a call from XXXX and I asked about underwriting and the POA. He informed me over the phone that everything was looked at by his office attorney and that the POA was good and our income was good. We suffered another hard inquiry credit check. After the credit check, I recieved my credit scores in the mail and an email stating that his underwriters were not recognizing my wifes income. I was shocked AGAIN because from the very beginning he recieved our POA and our VA award letters. His office had these documents since XX/XX/XXXX and it was now XX/XX/2018 and two weeks before closing. We were denied our mortgage and are in danger of losing this property as well. We feel that he dragged out this process unlawfully and wasnt truthful about showing his underwriters the POA prior to this process because I recieved a phone call from one of the underwriters stating I couldnt claim my wifes income. I feel that this office acted unlawfully by telling us different information over the phone to make my wife and I feel that everything was okay when Im fact they were not recognizing my income or the POA because the direct deposited checks have my wifes name on them and she wasnt on the loan due to her credit score even though we had be assured by XXXX verbally for months that the POA to claim my wifes income was okay. We are now in danger of losing this home TOO because of gross misconduct by XXXX XXXX and his XXXX office. My wife and I are in danger of losing this home and an additional {$480.00} on top of the {$1000.00} in damages we already suffered from the previous construction property. My wife and I have submitted every document requested by XXXX and his office, answered all questions asked of us truthfully and to the best of our ability and paid all money to all parties involved in good faith and based off of the information given to us by XXXX XXXX and his office. 
I am attaching a copy of the POA which has been in his offices possesion since XX/XX/2018. Its 9 pictures in order of each page of the POA. I am also enclosing copies of the contractor invoices.