Consumer complaint received 2024-07-31
Product: Mortgage — VA mortgage
Issue: Applying for a mortgage or refinancing an existing mortgage — Delays in the application process
Company: Onity Group Inc. (SC)

Good morning, I ( the buyer ) am assuming a VA Loan from another veteran and I believe the lender is in violation of the timeline outlined in Circular 26-23-10. The long drawn out process is negatively impacting both myself and the seller, who recently had to request financial assistance due to the banks slow processing of the assumption package. Could you please reach out to the bank to help us gain clarity on why things have moved so slowly and help us determine a definitive timeline for closing? 

Thank you, relevant details attached below : Bank : PHH Mortgage, XXXX XXXX XXXX XXXX XXXX, NJ XXXX Phone ( XXXX ) XXXX Regulation : 38 C.F.R. 36.4303 ( l ) ( 1 ) ( i ) ( C ). ( C ) In performing the requirements of paragraphs ( l ) ( 1 ) ( i ) ( A ) or ( l ) ( 1 ) ( i ) ( B ) of this section, the holder must complete its examination of the creditworthiness of the prospective purchaser and advise the seller no later than 45 days after the date of receipt by the holder of a complete application package for the approval of the assumption. The 45-day period may be extended by an interval not to exceed the time caused by delays in processing of the application that are documented as beyond the control of the holder, such as employers or depositories not responding to requests for verifications, which were timely forwarded, or follow-ups on those requests. 

Application opened with PHH Mortgage on XX/XX/year>2024. Bank insists on sending hard copies via snail mail to seller. Package arrives to the seller on XX/XX/XXXX. Buyer completes and submits a complete application for assumption to PHH on XX/XX/XXXX and is signed for by XXXX XXXX at XXXX. Bank makes standard record requests for additional underwriting documents and all are responded to on the same day ( most of them in under XXXX hrs ). These record requests occur at a rate of approximately XXXX per week. Finally on XX/XX/XXXX, the bank notifies us that they have submitted our file to the government XXXX and that the 45 day clock now begins as they state the they are only the servicer of the loan. 

The regulation above seems to indicate that the receipt of a completed package begins the 45 day clock, which aligns with VA Circular 26-23-10, not the end of the banks internal process of pushing packages to the underwriters. Any assistance you could provide would be greatly appreciated. Thank you! 


Record request data : Initial Record push from buyer XX/XX/XXXX Bank request XX/XX/XXXX @ XXXX additional docs - Response from buyer XX/XX/XXXX @ XXXX Bank request for rental property income XX/XX/XXXX @ XXXX - Response XX/XX/XXXX @ XXXX Bank tries to XXXX XXXX estimate and intent to proceed via snail mail. Finally able to convince them to send by email. 

Bank sends loan estimate XX/XX/XXXX @ XXXX - Response XX/XX/XXXX @ XXXX Closing Date Estimate Requested by sellers - Bank XX/XX/XXXX @ XXXX responds that Govt Underwriters are in possession and we should have a decision in no more than 45 days. 

Bank makes additional records request on XX/XX/XXXX @ XXXX - Buyer responds XX/XX/XXXX @ XXXX. 

Bank makes additional records request on XX/XX/XXXX @ XXXX - Buyer responds XX/XX/XXXX @ XXXX Bank states XXXX have the additional records and now XX/XX/XXXX states the 45 day clock.