Consumer complaint received 2024-09-10
Product: Mortgage — FHA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — Delays in the application process
Company: Freedom Mortgage Company (NC)

In XXXX of 2023 I started the process of initiating a loan assumption for a buyer to take over my FHA mortgage for my XXXX  in Pennsylvania. On XXXX2023 I sent the loan assumption form to my realtor who forwarded it to the buyer for signature. It was faxed to the loan assumption department at Freedom Mortgage on XXXX2023. On XXXX2023 Freedom Mortgage confirmed receipt of the document. They said the process take 45-90 days, so my realtor set a closing date based on that information. We contacted Freedom Mortgage as the date approached, and they said due to a mistake they never forwarded the assumption documents to the correct person. They again said it would be another 45-90 days for the process to be completed. My realtor updated all required documents and set another closing date based on that information. Every time we get close to closing, Freedom Mortgage claims that a document has expired, or they need something updated. Weve had to update the Agreement of Sale 4 times since the process started due to Freedom Mortgage delays. The original closing date was scheduled for XXXX2023. Due to the delays and failure to close on that date, it has cost us {$9200.00}, and every month another {$1400.00} is added to that. We own another home now, and were still paying the mortgage on this property nearly a year after initiating the sale process. The same buyer has been with us the entire time as well, they still want the property and are very motivated for this to come to an end.

I have complained to the HUD and they have been assisting, but Freedom Mortgage keeps delaying. They always need more paperwork, and during the delays other paperwork expires. We finally received a decision from their underwriting team, nearly a year after I first initiated the process with the assumption department their response is as follows : " Unfortunately, they have denied the loan as underwriting believes intended purpose is to use property as an investment property. The current loan is an FHA loan which would require a primary occupant to be within loan type requirements and guidelines. '' This decision seems to be based on nothing, as they have no evidence of the intentions of the buyer. The buyer has moved out of their primary residence, and is living in a basement of one of their other properties, as they expected this to be finished months ago. I'm convinced that they're delaying in the hopes that I try to have a conventional sale, and they can get out of this low interest rate 30 year mortgage. The longer they delay, the more it costs me. The buyer threatened legal action, and underwriting has reopened the file, and now they are claiming that they will need a new application as they can't open applications once they've been denied. This will just cause more and more delay. I need any help I can get to have this issue resolved. Thanks!

Ive attached the signed loan assumption form, the 1st and 4th agreements of sale, and various emails showing the frustration and issues weve had with Freedom Mortgage. The Freedom Mortgage contacts can be found in the emails. Please let me know if you need any further information from me, and I truly appreciate your help with this.