Consumer complaint received 2021-05-12
Product: Student loan — Private student loan
Issue: Getting a loan — Denied loan
Company: CITIZENS FINANCIAL GROUP, INC. (MA)

This all began with what I assume is a common problem for a lot of Americans. My wife and I were venturing into buying our first home or at least beginning the process. In order to begin looking at some open houses, we were advised to get a pre-approval letter. So, we reached out to a recommended mortgage lender and began the process. That's when we were told that our back-end debt-to-income ratio was currently just a few points higher than their underwriters would need for approval ( of the amount we were looking to spend on our first home ). This kickstarted my interest in helping my family out by delving into our finances and becoming a budgeting pro. I looked at our student loan situation and looked at where we could save some money. At this time, my wife and I have a small amount of consumer debt ( generally paid off monthly ), one credit card with a 6.24 % interest rate on a balance transfer that we're aggressively paying off, no car payments, no consumer loans, and a decent amount in savings - hopefully for a down-payment. My wife, a XXXX XXXX XXXX, spent quite a bit of loan money on her education, thus making our monthly student loan repayment obligations fairly high. There are 4 private loans with a private bank, Citizens Bank, being serviced by XXXX. I reached out to Citizens and explored their Education Refinance program. Seeing as how the 4 loans I was hoping to have consolidated/refinanced are already with Citizens, I figured this would be an easy process. I was wrong. Because both my wife 's and my federal student loans were in National Emergency Forbearance, due to the recent relief bills passed in Congress, Citizens was unable to determine how much our monthly payments were on those loans and estimated that payment to be higher. So, I then opted out of the forbearance and reinstated the federal student loan payments to create a record of what our income-based repayment amount is monthly, for both of our loans. I was then also told that the refinance application with Citizens also listed our rent payment twice ; once as rent payment and once as a mortgage payment. Once they fixed that on their end we were told that we still did not qualify. My wife makes a decent, stable, living as a XXXX XXXX  - serving the mental health community at a local non-profit hospital. Not only will her federal student loans be forgiven in a few more years, he current monthly payment - combined with our other debts - shows a relatively low debt-to-income ratio. First, we were told that they strictly look at our debt-to-income ratio, full stop. Then, in the same conversation, I was told that it was more of a holistic view of the applicant. Which is it then? We were told by Citizens that everyone who applies goes through a qualification process that takes into account their job, their education, their income, and their debts, in order to determine what DTI will be assigned to them. Other than that, they said that their process and that DTI was proprietary and that they were unable to share more with us about their process. Which really put up a red flag. Because we currently pay Citizens Bank for the loans we're wishing to refinance. And, if we refinance, then we'll be paying less monthly for them. Also, another representative told me that the decision has nothing to do with our creditworthiness, but that it had to do with our debt obligations ( which contain the loans we want to refinance ). In the weeks leading up to this complaint, I did a lot of homework at their request, including sending them scanned copies of our tax returns from XXXX and XXXX, along with all of the corroborating documents for those returns ( W-2 's, 1099 's, etc. ). I also sent a letter to the Attorney General 's office in Massachusetts, Senators XXXX, and XXXX, along with Congressman XXXX. Someone from the AG 's office did get back to me and is helping us look into this further. As of today, another representative at Citizens mentioned that our case has been elevated to the Office of the Chairman, where I hope someone will look at us as customers, with ample qualification, and overturn that denial. This process has been going on for over 6 weeks and I believe that Citizens will now try to hide behind their " Policies '' and " trade secrets '' in an effort to hold us off at the pass. But, I won't stand for it. I believe that Citizens is not looking at all of the documentation and evidence we have supplied and taken into account our determination to make financially sound decisions for our family going forward. I believe they are using a metric, told to me by their representative, of calculating our federal student loan monthly payments by multiplying our outstanding federal student loans by 1.8 % to determine our monthly outlay. Far more than the XXXX XXXX ( 0.5 % ) and XXXX XXXX ( 1.0 % ) calculation that is commonly used by mortgage lenders and alike. Which is a grossly miscalculated and inflated number, even if our federal student loans were in standard repayment. It would be impossible for us to meet that obligation and those numbers they calculated are false. What we do have going for us is that I've done an incredible amount of legwork to have all of our numbers, credit reports, and alike, at my fingertips to support my case. Had this just have been another year I might have called it quits weeks ago. But, after conversing with multiple Citizens representatives and teasing out a few pieces of their proprietary puzzle, I feel the only missing pieces are soon to be revealed. All we want to be able to do is buy a home and give our family the life we had as kids. Our five-year-old daughter deserves my level of commitment to this, and my wife surely deserves this opportunity.