Consumer complaint received 2017-05-08
Product: Mortgage — Other type of mortgage
Issue: Trouble during payment process — 
Company: PRIMELENDING, A PLAINSCAPITAL COMPANY (TX)

To Who It  May  Concern : I am the victim of fraud of FHA lending practices and HUD violations in rela tion to a 203 ( k ) lo an issued by PrimeLending, A  Plains Capital Company  located at  XXXX   XXXX   XXXX   XXXX ,  XXXX  TX with various locations throughout the United States.     The following is a synopsis of the events that lead to my allegations of fraud : Duri ng  XX/XX/XXXX ,  I began my search to locate and purchase a home in  XXXX   XXXX , Texas.     On   XX/XX/XXXX , per  PrimeLendings recommendation, I entered into a Homeowner/Contractor Agreemen t ( 203K F inancing ) with     XXXX   XXXX   ,  and PrimeLending provided the loan proceeds under the  F   ederal Housing Authority ( FHA ) 203 ( k ) loan program.
Prior to closing, PrimeLending   selected  XXXX   XXXX  as the certified HUD consultant for my   203 ( k )    loan pro gram. Because of PrimeLendings longstanding relationship with  XXXX   XXXX  and  XXXX   XXXX ,  XXXX   XXXX  also referred  XXXX   XXXX   XXXX  as a possible contractor. It was later learned that  XXXX   XXXX  illegally solicited funds from certain contractors including  XXXX   XXXX   XXXX  and in return for those funds,  XXXX   XXXX  created a      203 ( k ) con struction loan brochure that illegally recommended   XXXX   XXXX   XXXX  . Unbeknownst to me,  XXXX   XXXX  perpetuated that illegal behavior by assuring that  XXXX   XXXX  would be recommended for my   203 ( k ) loan  program  . (   XXXX   XXXX  is being investigated for fraud out of the   XXXX   XXXX    of T exas ) On   XX/XX/XXXX ,  I closed on the purchase of the Property and executed a promissory note for a loan from PrimeLending under the    203 ( k ) loa n program. After closing,   XXXX   XXXX   XXXX   began the rehabilitation process on the Property ; however, due to the inappropriate relationship and contention between  XXXX   XXXX  and  XXXX   XXXX ,  XXXX   XXXX  failed to monitor   XXXX   XXXX   work product on the Property. That is, during the  Propertys r ehabilitation process,  XXXX   XXXX  attempted to increase   XXXX   XXXX   illegal brochure fee. At that point in time,  XXXX   XXXX   (  owner of  XXXX   XXXX  ) became disgruntled with  XXXX   XXXX  and reported  XXXX   XXXX  actions to HUD, which initiated a federal criminal investigation against  XXXX   XXXX . Unfortunately, I am  one  of  XXXX   XXXX  victims. His case is pending sentencing in the  XXXX   XXXX  of Texas.     I notified PrimeLending of the consultants misconduct ; however, PrimeLending disregarded the improper relationships between  XXXX   XXXX  and  XXXX   XXXX  and failed to report any conflicts to HUD.     Eventually, after an outcry, and pe r PrimeLending 's  instructions, I terminated  XXXX   XXXX  services due to their failure to complete the renovations in a timely and workmanlike manner.  XXXX   XXXX  then filed a mechanics and materialmans lien against my Property.     PrimeLending did not offer any other solution so I felt I had no choice but to enter into an agreement with them. On   XX/XX/XXXX ,  I entered into a Settlement Agreement and General Release wherein PrimeLending credited my account {$55000.00} and agreed assignment of my rights and causes of action against   XXXX   XXXX  . ( PrimeLending is suing  XXXX   XXXX   XXXX  ) PrimeLending then recommend that I retain the services of   XXXX   XXXX   in order to complete the rehabilitation process. However,  PrimeLending  failed to obtain a construction contract between myself and  XXXX   XXXX  and allowed  XXXX  to work on the project without the proper building permits. Despite not having a construction contract,  XXXX   XXXX  began working on my property.     Unfortunately,  PrimeLending c ontinued to make misrepresentations, and  PrimeLending c ontinued its pattern of violating HUD regulations despite my outcries . PrimeLending  failed to execute a contact between myself and  XXXX   XXXX  and compensated them from my construction loan for unperformed work regardless of my reports of unskilled labor, and proof of  XXXX  's theft of physical property.     On   XX/XX/XXXX  , under duress, I terminated   XXXX   XXXX   XXXX   due to its failure to complete the renovations in a timely and workmanlike manner. I demanded an accounting of  XXXX   XXXX  ; however , PrimeLending f ailed to provide its accounting. Furthermore,  PrimeLending  paid out monies to  XXXX   XXXX  without my knowledge or approval.  PrimeLending has shut me out and made no attempt to assist or help me with my damaged property.    Complaints have been filed with HUD OIG ; however, HUD advises me that the only way I can get any kind of assistance is to civilly sue PrimeLending. I have been told that a civil case against  PrimeLending  will cost me {$50000.00}.     To date, after 4 years, the property renovations have never been completed and the property is in disrepair. I have home owners insurance, however, there could be liability issues since I do n't have a certificate of occupancy.  PrimeLending has abandoned me and left me with loan payment obligations that far exceed the value of the Property. Pri  meLending ha s settled a civil case against the contractor. However, they have no once contacted me regarding  my 203K loan o r issues with my home.   Throughout the rehabilitation process PrimeLending committed numerous HUD violations including the following :  ( 1 ) failed to report HUD inspection discrepancies ; ( 2 ) violated privacy requirements ; ( 3 ) violated numerous HUD accounting rules and regulations ; ( 4 ) failed to account for change orders and receipts ; ( 5 ) failed to identify the costs of material, labor, and profit margins ; ( 6 ) failed to ensure that proper permits were obtained prior to certain renovations ; ( 7 ) releasing loan proceeds without my approval ; ( 8 ) maintaining an inappropriate relationship with contractors, including   XXXX   XXXX   and   XXXX   XXXX   ; ( 9 ) failed to ensure that proper construction contracts were signed between myself and   XXXX   XXXX   ; ( 10 ) failed to obtain  a 203 ( k ) c onsultant ; ( 11 ) failed to notify HUD when the loan proceeds were exhausted despite the fact that the Property had not been certified for occupancy by the proper authorities ; and ( 12 )  interfered with a criminal investigation involving   XXXX   XXXX       These types of loans target lower income, less knowledgeable homebuyers. By  XXXX   XXXX  own admission, he made {$400000.00} in a  one year period fr om 203 ( k ) loans  executed by PrimeLending. By PrimeLendings own  admission,  XXXX   XXXX  was on their short list and was consistently recommended.   XXXX   was also recommended b y PrimeLending and protected him knowing that he stole physical property purchased by funds from my contraction account. It appears at least with my case there is enough evidence to prove that these contractors and PrimeLending had an understanding of sorts. Not that it was wr itten or verbalized, but that it evolved overtime and each company used the other one for their own profit.   I am not sure if these allegation fall within the consumer financial  Protection Bureaus  purview ; but if they do I am asking that these allegations be investigated and if they are found to be true, that   PrimeLending be sanctioned according to federal protection laws.
Evidence includes over 600 photographs ; 189 pages of text mess  ages sent and received from    XXXX   XXXX  /  XXXX   XXXX   XXXX   ;    269 p ages of text messages sent and received  from   XXXX   XXXX  /  XXXX   XXXX   ; 100s of   pages of emails sent and received from PrimeLending/staff ; and all pertinent legal documents. PrimeLending h as copies of all these documents.     Thank you,