Consumer complaint received 2023-10-30
Product: Mortgage — Conventional home mortgage
Issue: Trouble during payment process — Private mortgage insurance (PMI)
Company: JPMORGAN CHASE & CO. (IL)

On XX/XX/XXXX XXXX I called the previous servicer of my mortgage about PMI cancellation based on current value of the property with significant improvements. On XX/XX/XXXX XXXX XXXX the previous servicer sent me an application for cancellation, which I received a few days later. On XX/XX/ -- the two-year anniversary of my mortgage loan -- servicing of the loan was transferred to the current servicer, Chase ( although the owner of the mortgage, XXXX XXXX XXXX did not change ). On XX/XX/, the previous servicer received my completed application for PMI cancellation. On or about XX/XX/XXXX XXXX XXXX  I received a letter from the previous servicer advising that I would need to restart this process from the beginning with my new servicer, Chase. I subsequently called Chase about PMI cancellation, and received a very similar application for cancellation a few days later. I completed this application and returned it to Chase. As part of this process, a broker price opinion was ordered and scheduled for XX/XX/XXXX XXXX 

I received the XXXX and Chase 's determination in a letter dated XX/XX/. The results of the XXXX from the realtor ( whose selection was left to Chase 's discretion ) included several startling details. First, while it alluded to my improvements to the property since purchase, it misquoted the estimate I gave for the total cost of those improvements ( it listed $ XXXX instead of $ XXXX ). Second, it offered a value of the property ( $ XXXX ) that is, to this day, several XXXX dollars lower than Chase 's own estimation of the property 's value AND thousands less than the LOWEST END of the estimated value ranges provided by every reputable real estate website ( which not only track many more comparable sales, but which have also lacked any information on improvements to the property when generating these ranges ). Third, and most shockingly, in real dollars, the XXXX implied that the value of my home has DEPRECIATED by more than {$27000.00} in XXXX years ( in spite of the improvements and the neighborhood 's substantial growth since the property was purchased ). Chase has never provided any information re : appealing the XXXX 's findings. 

Ultimately, I believed these ostensible flaws in the XXXX did not matter, as the estimated value still placed my XXXX ratio at 79.2 % ( <80 % ). However, Chase denied PMI cancellation on the basis that the threshold for cancellation was actually 75 % because my loan was about 3 months past its two-year anniversary ( note that I began this process BEFORE the two-year anniversary, but it was stymied by a coincidental servicer change ). Conveniently, the flawed XXXX  and this " new '' threshold combined to mean that the principal-reduction payment Chase was demanding to cancel PMI under the new value test was almost identical to the payment they had demanded to cancel PMI under the original value test ( in fact, it was {$900.00} MORE ). This conclusion struck me as inaccurate, as XXXX XXXX XXXX servicing guidelines suggest that the 80 % threshold applies to any request made under the " significant improvements '' prong for PMI cancellation, and at least two other servicers of XXXX XXXX loans indicate explicitly in online materials that the 80 % threshold applies to requests for cancellation of PMI on XXXX XXXX mortgages when made under the significant improvements prong, even for years 3-5 of the loan. 

Given these facts, I immediately called Chase to ask why a 75 % threshold was being applied to my PMI-cancellation request. The Chase representative confirmed that I had made a request under the " significant improvements '' prong and confirmed that no determination was made that significant improvements were not present. After I referred the representative to XXXX MXXXX XXXX servicing guidelines, he agreed that he did not know why the 75 % threshold was used, and he indicated that he would escalate the matter. Chase responded to this call in a letter dated XX/XX/. The letter -- less than one page -- concluded simply that " If ... the loan is between two and five years old as in your case, a XXXX is required to confirm you have a 75 % LTCV ratio even if SI [ significant improvements ] have been made on the property ''. It explicitly attributed this putative rule solely to XXXX XXXX, but did not cite any document supporting such a requirement. 

On XX/XX/, I again called Chase to ask about the letter they sent in response to my previous call. The representative from Chase advised me of two things : ( 1 ) that if the 75 % threshold Chase was requiring appeared to differ from XXXX XXXX XXXX public requirements, then it must have come from XXXX XXXX in my original loan documents, and ( XXXX ) that I should send further communications through their online messaging platform, as any future calls would simply generate the same form letter that Chase sent me before. I subsequently reviewed my loan documents and confirmed that item # 1 was untrue ( unsurprisingly, as FXXXX XXXX did not originate my loan, and I have never signed any agreement with XXXX XXXX ). I then sent a message to Chase through its online platform as I was advised to do. 

On XX/XX/, I was informed that Chase was " escalating '' my inquiry and that I would receive a response in 3 business days. Later that same day, XX/XX/XXXX XXXX XXXX I spoke to a representative ( XXXX XXXX at XXXX XXXX who disagreed with Chase 's statement of XXXX XXXX XXXXs policies in its XX/XX/ letter, and informed me that, in line with XXXX XXXX XXXX servicing guidelines, with significant improvements, the threshold for PMI cancellation would be 80 %, regardless of the loan 's current age. He further explained that the only reason for not processing my PMI cancellation request would have been if the improvements I had made to the property were determined to not qualify as " significant improvements. '' As a reminder, this was a potential suspicion of mine from the start. In my original call to Chase, I specifically inquired whether such a determination of no significant improvements was made and, if so, where I could find information supporting that determination. On the phone, I was advised that no such finding was made ( although the representative confirmed that I had applied under the " significant improvements '' prong for cancellation ), and the letter I received in response to this call indicated that the 75 % threshold was applied solely on the basis of the age of my loan, not based on a determination of no significant improvements. 

After the call with XXXX XXXX  I sent a supplementary message to Chase, explaining the information I had received from XXXX XXXX and again asking for justification for Chase 's decision. I received a confirmation message that said this supplementary message would receive a response in one business day. 

As of today, XX/XX/ ( six business days later ), neither the XX/XX/ message nor the XX/XX/ message has generated a substantive response from Chase. Earlier today, I called Chase again and requested the name of the insurer collecting my PMI premiums each month. I was informed that the insurer was XXXX XXXX XXXX XXXX, a subsidiary of XXXX XXXX XXXX XXXX Based on my subsequent research, an investment affiliate of Chase is the third-largest shareholder of XXXX XXXX, XXXX XXXX with somewhere between 6 and 8 % ownership ).