Consumer complaint received 2024-09-13
Product: Mortgage — Conventional home mortgage
Issue: Closing on a mortgage — Closing disclosure or other related disclosures
Company: JPMORGAN CHASE & CO. (TX)

I applied for a home loan with Chase which was approved. As we worked thru the process and reviewed the home inspection results, there were some issues that needed to be fixed, one being some foundation work. I ended up negotiating a {$16000.00} seller credit because of the issues needing to be fixed and the seller not wanting to pay out of pocket to fix those items before closing. My realtor told me to confirm with the lender that the {$16000.00} seller credit would actually be applicable as closing as there are generally some restrictions on how much seller credit a buyer can get at closing. I emailed my loan officer, XXXX XXXX on XX/XX/year>, and explicitly asked if there was a maximum seller credit that I could receive at closing, and I specifically mentioned that I had negotiated a fairly substantial {$16000.00} credit and wanted to make sure I wasn't exceeding the seller credit cap. His reply was " The maximum contribution you can receive is 6 % of the purchase price ''. The purchase price of the home was {$430000.00} so according to XXXXXXXX XXXX reply, I was clear up to {$25000.00} in seller credit. On XX/XX/year>, as the loan proceeds to underwriting, I get an email from XXXX that the seller credit ( {$16000.00} ) plus lender credit ( {$1500.00} ) in total is more than the closing costs and by law, I can not apply offset more than the closing cost using credits. Essentially, what they ended up saying was that I can not receive cash back on a purchase or use credits to reduce my down payment. At this point, after having accepted a seller credit that I needed to use to pay for foundation repairs, I was told either the seller credit is reduced ( meaning I whatever credit remains after offsetting closing costs ) or I find a way to use the credit in the loan. I ended up having to escrow homeowners insurance ( which I never do ) and then apply {$6900.00} of the remaining seller credit to buy down the interest rate just so that I didn't completely lose the seller credit I negotiated. In the end, I got stuck having to pay an additional {$6600.00} out of pocket for the foundation work after the loan closed. That foundation repair bill was supposed to have been offset by the seller credit. If I was properly advised that seller credit could not exceed closing costs, I would have forced the seller to fix the foundation issue and not taken on the burden of that cost myself. I was misled by my lender and deem this to be complete negligence as they are responsible for making sure I am provided accurate information, especially when I explicitly ask a simple, straightforward, and critical question. I am fighting to get cash back from Chase to actually pay for the repairs, but they have been taking their sweet time " reviewing the case ''. To make matters worse, 2 days before closing, Chase tells me that they can not close the loan because they came across an amendment that was on file for weeks stating that I needed the seller to have a licensed electrician visit the property and properly label the electric wires. In the end, seller didnt do that because we agreed that would be something I handled in the {$16000.00} credit. That amendment was never executed but was always available to Chase to review. They didnt bother to do their due diligence and then put me in a tough spot the night before closing ( after I tried to fight back on the request ) as I had to find a licensed electrician to spend 5 minutes labeling wires. That cost me {$300.00} out of pocket. Completely ridiculous and incompetent team that I was made to work with. 
They need to own up to their mistake an offer compensation. I asked for {$7000.00} to help offset the foundation repair I had to pay for out of pocket along with the {$300.00} I had to pay an electrician at the last minute.