Consumer complaint received 2024-07-22
Product: Mortgage — Home equity loan or line of credit (HELOC)
Issue: Closing on a mortgage — Delays with the closing process
Company: KEYCORP (CO)

As part of a refinance to a lower interest rate on our primary home, we were advised we had to close our HELOC with Key Bank since re-subordination was not an option. We signed a payoff dated XX/XX/XXXX on XX/XX/XXXX as part of our closing on the refi. A check in the amount of {$59000.00} was sent to Key Bank by XXXX XXXX ( dated XX/XX/XXXX, received on XX/XX/XXXX and cashed by Key Bank ). 

We thought the HELOC was closed, but Key Bank continued to send monthly statements and eventually started charging annual maintenance fees for the line of credit that should have been closed. I don't have specifics in terms of dates, but this has been an ongoing issue for the past three years. 

I called Key Bank when the first maintenance/annual fee was charged expressing my confusion since the line of credit was closed ( as I understood things ). My first interaction ended with Key Bank waiving the fee and agreeing the loan was paid off, but I continued to receive statements and Key Bank continued to charge me maintenance/annual fees. 

Key Bank never explained why it refused to close the loan, so I ended up contacting the mortgage broker who helped me facilitate the transaction, and he started a conversation with XXXX XXXX. XXXX XXXX provided the payoff letter we signed as well as a copy of the cancelled check. I circled back with Key Bank, and after escalation to a manager, she ended up stating they had no record of the payoff we signed in XXXX of XXXX, and that if we faxed the original payoff that Key Bank would have proper evidence to finally close the loan. 

XXXX XXXX faxed the signed payoff letter and cancelled check to Key Bank on XX/XX/XXXX, and Key Bank responded XX/XX/XXXX by fax to XXXX XXXX stating " please be advised that this is the XXXX signed request to close the account we received '', and that " you may submit a request for a payoff quote on the account, we will require an updated signature from the client in order to process, thank you ''. This is not an acceptable conclusion to the issue since the last payoff we received from Key Bank dated XX/XX/XXXX included a {$26.00} reconveyance fee along with {$100.00} in other charges. 

Had Key Bank clearly stated at my initial inquiry that no payoff was received, helped my understand the situation and waived fees that never should have been collected, I would have resolved the issue directly with them, but it took another XXXX plus years including in person and a number of phone conversations with various Key Bank staff before they were able to explain that they lost or never received the payoff that accompanied the payment from XXXX XXXX. If we genuinely owe fees related to the closing ( like the reconveyance ) and they can show we were refunded these fees or never paid them, I'm okay covering legitimate charges and paying off the loan ; however, Key Bank to this point has also included additional fees that would never have been warranted if the account was properly closed as requested by XXXX XXXX and myself in for the form of the payoff letter and payment in XXXX of XXXX. 

I would prefer to resolve this issue myself ( as I've tried to do for several years ), but feel Key Bank has left me no choice but to file a complaint based on their inability to effectively handle what I would consider a relatively common/mundane error. 

Thank you for taking the time to read this explanation. 

Regards, XXXX XXXX