Consumer complaint received 2015-12-11
Product: Mortgage — FHA mortgage
Issue: Application, originator, mortgage broker — 
Company: HOMESTAR FINANCIAL CORPORATION (AL)

As low income and moderate income consumers have a hard time breaking into the home purchasing market in this area, XXXX, buyer found a HUD repo to purchase with only {$100.00} down and seller pays 3 % closing costs. This is a sweet deal for a low income/moderate income buyer ; however, the first mortgage company, XXXX Mortgage XXXX, preapproved buyer for the property right away but failed to complete the process. This company was given 60 days to complete where the buyer soon learned that this was a rag-time company operating on lies and deception. Each time consumer would call the LO would not answer the phone -- only operated in e-mail communications. This company kept running credit reports, bringing down the credit score. Also, this company tried to make the buyer pay for Rapid Rescoring, and insisted that buyer pay for this cost thru credit card after requesting the buyer pay down these accounts to help with the DTI. The LO requested {$450.00} for an appraisal which never took place. Buyer found out after canceling with this company. This was a horrible experience. HUD offered a 60-day closing, and this company waited until the last week before alerting buyer about errors appearing on credit report. Advised buyer to not dispute these errors, but buyer did not comply and these errors were removed, immediately, after disputing. 
To save the great deal ( {$100.00} down/seller pays 3 % closing ), buyer obtained another mortgage company that stated it could process, underwrite, and fund within a day -- Homestar Financial. The file was discussed with the LO on or about XXXX XXXX, 2015 and given to the LO of Homestar Financial, XXXX around or about XXXX XXXX, 2015 with the disputed errors in process. The buyer received a closing extension from HUD until XXXX XXXX, 2015. The LO from Homestar Financial stated the loan would be approved with the assumption that the errors would be corrected. The credit corrections were done on or about XXXX XXXX, 2015 and forwarded to the LO at Homestar Financial. Buyer received an e-mail from LO that he was not in the office and for buyer to forward the corrections, and he would make sure Credit received them on XXXX XXXX, 2015. On XXXX XXXX, 2015 Homestar submitted a Loan Estimate with several major errors and required buyer to sign. Buyer refused to sign, and the file was submitted to underwriting, buyer assume, with these errors. This LO is not familiar with HUD/FHA closing, and has delayed up until today the closing -- offering no solution to an extension. Even when the realtor had submitted a cancellation notice to HUD this a.m., he was still e-mailing about the closing -- that it will take until the end of the month. The LO has no clue as to the policy and procedure of HUD nor FHA. Buyer lost the great deal. Homestar Financial needs to change its mission statement because it is not in the business of helping all buyers. Buyer find that this mortgage company will nickle and dime a consumer to no avail. It will make sure the buyer does not get back any funds from the earnest money even though that money is over and above what is needed to close. It will find a way to take that money. Buyer did have credit issues, but those issues were quickly fixed according to FHA guidelines. Buyer had a low middle score of XXXX, but was able to bring that up to XXXX ; however, Homestar still assessed a 4.75 % FHA interest rate. Buyer did not receive a fair shake from this company and missed a great opportunity as a low income/moderate income minority homebuyer. The LO took on an egotistical, lackadasical attitude. There are nill to none $ XXXX/down homes in this area. This was a golden opportunity for a moderate income minority homebuyer.